Effectiveness of Set-Off Claims in the Pre-Bankruptcy Period

Abstract

Bankruptcy and rehabilitation law, following previous regulations, stipulate the conditions for the admissibility of set-off claims. One of the constraints laid down is the prohibition of set-off claims acquired on the basis of transfers or bank endorsements in a period of one year period preceding the bankruptcy. Against the background of current regulations a dispute has arisen in the case law of recent years whether set-off claims acquired in the above mentioned circumstances are effective or permissible when a creditor has not only acquired, but also made a declaration about a set-off, within one year before bankruptcy has been declared. The paper is a summary of the views presented in the case law of the Supreme Court and attempts to draw practical conclusions in the context of economic activity.