Bankrupt

n. [Fr. banqueroute, Sp. bancarrota, It. banco rotto, bankruptcy, from Fr. banque, Sp. banca, It. banco, bank, and Norm. Fr. roupt, rous, Sp. roto, It. rotto, Lat. ruptus, broken, p. p. of rumpere, to break; Ger. bankrott, formerly bankerot, bankruptcy and bankrupt, a.] 1. (Eng. Law.) A trader who secretes himself, or does certain other acts tending to defraud his creditors. Blackstone. In this sense, a man may be a bankrupt and not insolvent, or insolvent and not a bankrupt.

2. A trader who breaks or fails, or becomes unable to pay his debts in the ordinary course of trade; an insolvent trader.
3. Any individual unable to pay his debts; an insolvent. McCulloch.

In strictness, no person but a trader can be a bankrupt. Bankruptcy is applied to merchants and traders, insolvency to other persons. This distinction is not preserved in the United States, the tendency being to apply the terms bankrupt and insolvent to the same description of persons. In the United States bankrupt law of 1841, repealed in 1843, the term bankrupts was applied to others besides merchants and traders, and in that law the features of both a bankrupt and insolvent law were united. So the features of both systems are united in many of the State insolvent laws. And in England in recent times, the distinction between bankrupt and insolvent laws is much less positive and exact than it formerly was. New Am. Cyc. Burrill. Parsons. Bankrupt law, a law which, upon a bankrupt's surrendering all his property to commissioners for the benefit of his creditors, discharges him from the payment of his debts, and all liability to arrest or suit for the same, and secures his future acquired property from a liability to the payment of his past debts. See INSOLVENT.—Bankrupt system, a system of laws and legal proceedings in regard to bankrupts and their property.