Relation back, doctrine of

Updated: Aug 20, 2021

In cases of bankruptcy and liquidation, the power of a trustee or liquidator relates back to the commencement of the bankruptcy or liquidation. This means that he can ignore all transactions that are made between the recover monies paid. He is entitled to all the recover monies paid. He is entitled to all the property that existed at the commencement. There are, however, certain protected transactions. These are generally transactions made by the debtor in good faith and for value.

Reference: The Penguin Business Dictionary, 3rd edt.

Sources & references
Risk disclaimer

Invezz is a place where people can find reliable, unbiased information about finance, trading, and investing – but we do not offer financial advice and users should always carry out their own research. The assets covered on this website, including stocks, cryptocurrencies, and commodities can be highly volatile and new investors often lose money. Success in the financial markets is not guaranteed, and users should never invest more than they can afford to lose. You should consider your own personal circumstances and take the time to explore all your options before making any investment. Read our risk disclaimer >

James Knight
Editor of Education
James is a lead content editor for Invezz. He's an avid trader and golfer, who spends an inordinate amount of time watching Leicester City and the… read more.