Bill: Pending P.B.04-043 | The Bankruptcy Unification and Tort Totalization Act

ConsequencesInc · 2026-05-04T03:37:28-0400

A
BILL
TO
Provide for the Definition and Administration of Bankruptcy and Related Torts

1 - About this Act

(1) This Act

(a) May be cited as ‘The Bankruptcy Unification and Tort Totalization Act’ (the “BUTT Act”).

(b) May be numbered as P.B.04-043.

(c) Shall be enacted upon receiving assent from His Majesty the King

(d) Has been authored by ConsequencesInc and bernard_madoff.

(e) Has been co-sponsored by bernard_madoff

2 - Definitions

(1) “Creditor” means any particular individual or entity to whomst a recognized obligation or debt is owed.

(2) “Debtor” means any particular individual or entity that owes a recognized obligation or debt to creditor

(3) “Asset(s)” means any cash, property and/or investments that a particular individual or entity owns.

“Liabilities” means all debts and obligations that a particular individual or entity owes to creditor

(4) “Equity” means the total of all of a debtor's assets minus all of a debtor's liabilities.

(5) “Cash” means Alexandrian Pounds (£) and Redmont Dollars ($), held either in a player’s account or in a bank/Financial institution.

(6) “Property” means any plots, buildings, and item(s) that a particular individual or entity owns, or is held in trust for them by another entity.

(7) “Investments” means any stocks, commodities, bonds, loans, plots designated for renting, or any other financial instrument held by a particular individual or entity for the purpose of generating future income, profit or value.

(8) “Good Faith” means a demonstrable and ongoing effort by any particular individual or entity(s) to cooperate with the Courts, creditor, and debtors in order to resolve and repay outstanding obligations.

(9) “Bankruptcy coefficient” means the total assets of a debtor divided by the total liabilities, rounded to the nearest hundredth.

(10) “EBITDA” means earnings before the deduction of interest, taxes, depreciation, and amortization. It is a non-GAAP calculation based on data from a company's income statement used to measure a company's operating profitability.

3 - Bankruptcy Filings

(1) Bankruptcy proceedings may be filed before the Magistrates Court either:

(a) Voluntarily by the particular individual or entity responsible for the debt; or

(b) At the request of one or more creditor.

(i) A request by a creditor must include proof of at least two (2) attempts to contact the debtor regarding repayment through at least two (2) of the following channels:

Private discord DM
In-game mail
Announcement in #legal channel in the StateCraft Discord.

(2) A Petition for Bankruptcy filing shall contain the following information:

(a) The name of the debtor (as a particular individual or entity)

(b) A list of all known creditor(s)

(c) Reason for seeking bankruptcy

(d) Documentation and acknowledgement of debts owed

(e) Proof of attempt(s) to contact debtor (if the bankruptcy is requested by creditor)

(3) A Bankruptcy filing meeting all the information in chapter (3)(2) of this Act shall be accepted by the Magistrates Court and the following shall occur:

(a) If the Petition is Voluntary, the court shall make an announcement in #government-announcements for the known creditor to appear before the court within 72 hours. The announcement shall also be for any unknown creditor wishing to make claims to make themselves known to the Court within 120 hours.

(i) Any known creditor that fails to appear within 72 hours forfeits 50% of the outstanding debt owed to them.

(ii) Any unknown creditor that fails to appear within 120 hours forfeits 50% of the outstanding debt owed to them.

(b) If the petition is made by creditor, the court shall make an announcement in #government-announcements for the debtor to appear before the court within 72 hours. The announcement shall also be for any other creditor wishing to make claims to make themselves known before the Court within 120 hours.

(i) Any other creditor that fails to appear within 120 hours forfeits 50% of the outstanding debt owed to them.

(ii) If the Debtor fails to appear before the court, the proceedings shall immediately proceed to Chapter 7 Bankruptcy after 120 hours.

(iii) For any Debtor that has been Deported for a time of more than 4 months, the proceedings shall immediately proceed to Chapter 7 Bankruptcy.

(4) At this point in the proceedings, the Court shall offer binding mediation-arbitration per chapter (3)(1) of the Actual Judicial Reform Act. If all parties currently involved agree, the Bankruptcy proceedings shall continue under mediation-arbitration.

(5) If mediation-arbitration does not proceed, the Debtor shall have 72 hours to file before the Court the following:

(a) A list taking stock of and valuing all assets the Debtor owns, and the current cost of all liabilities the Debtor has.

(b) Any exemptions the Debtor wishes to claim under Chapter 9 of this Act.

(6) After the Debtor files the information in chapter (3)(5), creditor shall have 72 hours to submit counterclaims for any assets and their valuations, or debts not listed by the Debtor.

(a) The Court will check to see if the Debts submitted by creditor are valid under the Code of Contract Act before accepting them as liabilities the Debtor still owes.

(b) Debtors may provide counter evidence (e.g. screenshots, records, receipts ,agreement of discharge off debt, or other proof of partial or full settlement of debt) to dispute any assets or debts creditor wishes to claim as part of the Bankruptcy proceedings

(c) A creditor may request that the Court compel Financial Institutions to:

(i) Confirm if the Debtor is a depositor at the Institution, and

(ii) If the Debtor is a depositor, list the current funds they hold in that Institution.

(d) For any disputes regarding the value of an asset, the Courts may use any of the following to determine a fair market value:

(i) The last sale price of the asset

(ii) The average sale value as listed by a CPI issued by the MoTF no more than 2 months ago.

(iii) The price at which a chest shop that currently can afford to buy the asset will purchase it at.

(iv) The price at which an expert witness who can reasonably value the asset (e.g. relator, art dealer, etc.) would testify it’s fair market value to be.

(7) After all counterclaims have been settled, the Courts or a Court appointed accountant shall determine the total assets, liabilities, equity and bankruptcy coefficient of a debtor.

(a) If a Debtor’s equity is positive, or the bankruptcy coefficient is equal to or more than 0.33, the Bankruptcy shall proceed under Chapter 5 (for particular individuals) or Chapter 6 (For Legal Entities) of this Act.

(b) If a Debtors equity is negative and the bankruptcy coefficient is less than 0.33, the Bankruptcy shall proceed under Chapter 7 of this Act.

(c) The Courts may overrule the coefficients in Chapter 3 (7)(a) and (7)(b) at its discretion if it believes the Debtor cannot meaningfully repay and/or restructure its debts.

(d) The creditor through unanimous consent may choose to continue forward with Chapter 5 or 6 Bankruptcy in lieu of Chapter 7 Bankruptcy.

(i) This cannot override a debtor’s voluntary declaration of Chapter 7 Bankruptcy.

(8) If at any point during this process the Debtor goes inactive or refuses to participate in Good Faith, the Court at its discretion may automatically proceed to Chapter 7 Bankruptcy.

(9) A debtor may at any time during the proceedings voluntarily declare Chapter 7 Bankruptcy.

4 - Chapter 4 Bankruptcy - Government Insolvency

(1) In case of Economic Crisis that results in Government insolvency, break the glass behind the Minister of Trade and Finance's desk in the ministry building and follow the instructions within.

5 - Chapter 5 Bankruptcy - Repayment

(1) If the equity of a Debtor is positive, a 10% fee owed to the creditor shall be added to repayment.

(2) Repayment shall take into consideration the following:

(a) The gross income of the Debtor

(b) The ability of the Debtor to repay the debt in a timely manner

(c) The ability of the creditor to reasonably reduce the debt owed to ensure recovery of the debt.

(d) The impact on the Debtor’s financial situation.

(e) Any exemptions the Debtor wishes to claim under Chapter 9 of this Act.

(3) The Debtor and creditor shall submit an agreed contract regarding repayment.

(a) In the event of a disagreement between the debtor and the creditor the courts shall structure a repayment plan at the court’s expense of either the debtor and/or the creditor.

(i) The expense shall be at the court’s discretion.

(4) While the Debtor’s repayments to creditor are proceeding, the Bankruptcy case will continue until all repayments are settled, after which the court case may be adjourned and the associated debts settled.

(5) If the Debtor fails to make repayments, the creditor may petition the court to move to Chapter 7 Bankruptcy.

6 - Chapter 6 Bankruptcy - Restructuring

(1) If the equity of a Debtor is positive, a 10% fee owed to the creditor shall be added to repayment.

(2) Repayment shall take into consideration the following:

(a) The EBITDA of the Debtor

(b) The ability of the Debtor to repay the debt in a timely manner

(c) The ability of the creditor to reasonably reduce the debt owed to ensure recovery of the debt.

(d) How the repayment will affect the Debtor’s ability to continue to reasonably due business.

(e) Any exemptions the Debtor wishes to claim under Chapter 9 of this Act.

(3) The Debtor and creditor shall submit an agreed contract regarding repayment.

(a) In the event of a disagreement between the debtor and the creditor the courts shall structure a repayment plan at the court’s expense of either the debtor and/or the creditor.

(i) The expense shall be at the court’s discretion.

(4) While the Debtor’s repayments to creditor are proceeding, the Bankruptcy case will continue until all repayments are settled, after which the court case may be adjourned and the associated debts settled.

(5) If the Debtor fails to make repayments, the creditor may petition the court to move to Chapter 7 Bankruptcy.

7 - Chapter 7 Bankruptcy - Liquidation

(1) In the case of Chapter 7 Bankruptcy, the Courts shall order all assets of the Debtor other than those that the Court rules as being exempt under Chapter 9 of this act to be taken into custody of the State to hold for the Courts.

(2) The Court shall order the MoD to repossess all non-exempt property.

(3) The Court shall order all Financial Institutions where the Debtor holds accounts to turn over those account balances to the GovReserve account for safe keeping.

(4) The Court shall order the MoTF to fine the Debtor’s personal and/or business accounts for their non-exempt amounts.

(5) The Court shall order the MoJ to, with the assistance of StateCraft Staff, seize all non-exempt property from chests that the Debtor has access to or is being held for the Debtor.

(6) After paying all Secured Debt Holders their collateral as outlined in Chapter 8 of this Act, the Courts shall with the assistance of the MoJ, MoTF and MoD, liquidate the Debtor’s seized assets for cash proceeds in a manner which ensures the creditor receive the most value possible, including:

(a) Auctioning off or offering for sale the assets to the public

(b) The Government purchasing the assets at or above fair market value if it so chooses

(c) Redistributing any remaining seized assets that cannot be sold or auctioned off to the creditor

(7) After liquidating and/or attempting to liquidate the Debtor’s seized assets, the proceeds of the liquidation and any remaining assets shall be distributed according to Chapter 8 of this Act.

(8) After finishing distributing the proceeds of the liquidation and remaining assets to the creditor, the case shall be adjourned and all debts associated with the proceedings settled.

8 - Liquidation Preference

(1) The following is the liquidation preference for creditor(s) grouped into classes. The list is in order from the debts that must be paid first (senior debt holders) to the debts that will be paid last (junior debt holders and equity holders):

(a) Any debts which have specifically listed item(s) as collateral (Secured Debt Holder)

(b) Any debts owed to the Government, including any fines, taxes, premiums and/or fees (Preferred Unsecured Debt Holder).

(c) Any Depositor’s accounts in a Financial Institution (Preferred Unsecured Debt Holder).

(d) Any debts which do not have specifically listed item(s) as collateral (Junior Unsecured Debt Holder)

(e) Preferred stock shareholders (Equity Holder)

(f) Common stock shareholders (Equity Holder)

(g) Any other equity holders or partners (Equity Holder)

(2) For each class of debts described in chapters (8)(1)(a) through (8)(1)(d), liquidation preference within each class (unless otherwise stated in a contract) shall be determined in the following order:

(a) The age of the debt (oldest debt will be paid first).

(b) If multiple debt(s) have the same age, then the debt that has the largest outstanding payment due shall be paid first.

(3) For classes of equity holders in chapters (8)(1)(e) through (8)(1)(g), liquidation preference (unless otherwise defined in the company’s Incorporation or Formation paperwork and/or contract) shall be determined in the following order:

(a) Type of equity holder:

(i) Preferred Stock (1st)

(ii) Common Stock (2nd)

(iii) Other equity holder/partner (3rd)

(b) For different classes of stock (i.e. Class A, Class B, etc.) within a type of equity, the stock class that was issued earliest shall be paid first. If multiple classes were issued at the same time, they shall have equal liquidation preference to be paid out proportionally unless otherwise noted.

(c) For equity holders and partners in a business, the equity holder(s) or partner(s) shall have equal liquidation preference to be paid out proportionally to their equity share unless otherwise noted.

(4) The liquidation preference between debt holders may be changed by mutual unanimous agreement between all debt holders involved in a bankruptcy.

(a) Stock holders and any other equity holders are not required to agree to these changes.

9 - Exemptions

(1) All particular individuals and legal entities, unless otherwise noted, are permitted to exempt from Bankruptcy proceedings the following asset(s):

(a) A maximum of £500 worth of property and cash.

(2) All particular individuals and legal entities who act in Good Faith during the Bankruptcy proceedings are permitted to exempt from Bankruptcy proceedings:

(a) A maximum of £1,500 worth of cash and property.

(b) A maximum of 1 land plot (c, r, rc, or otherwise) in addition to any plots claimed under chapter (9)(2)(a) of this Act.

(c) A maximum of £1,000 pounds worth of investments

(d) A maximum of £1,000 pounds worth of any assets, in addition to any other assets claimed under chapter (9)(2)(a) through (9)(2)(c) of this Act.

(3) Any assets promised as collateral for debt cannot be exempt from Bankruptcy proceedings unless the debtor comes to an agreement with the debt holder

(4) Any assets that belong to an entity that a debtor owns or is the beneficiary of shall be exempt from Bankruptcy proceedings so long as the entity is not the debtor, the debtor acts in Good Faith, and the asset(s) is/are not promised as collateral for a debt.

(5) For any particular individual or entity to claim exemptions from Bankruptcy Proceedings, they must submit to the Court for approval a list of what they want to exempt pending final approval of the Bankruptcy proceedings.

(a) If Bankruptcy Proceedings are held under mediation-arbitration, the list will instead be submitted to the mediator/arbitrator.

10 - Amendments to the Revenue Act

(1) Section 6 - Financial Institution Tax shall be amended in the following manner:

“(1) Deposit-taking Financial institutions will be taxed monthly based on one of the following:”

(2) Section 7 - Financial Records and Reporting shall be amended in the following manner:

“(1) Deposit-taking Financial institutions must keep detailed accounts of their investment revenue and obligations to their depositors.

(a) Should deposit-taking financial institutions misrepresent their profits to the Ministry of Trade & Finance, the entity will be liable for prosecution.

(b)[...]

(2) Deposit-taking Financial institutions are required to report to the Ministry of Trade & Finance by the end of the first week of the succeeding month:”

11 - Amendments to the Legal Entity Act

(1) Section 7 - Corporation shall be amended in the following manner:

“6. Formation:

1. [...]

3. [...]

1. The Ministry of Trade and Finance shall be liable to pay $50 every begun day exceeding this limit to the Incorporators.

1. [...]

2. [...]

3. [...]

4. [...]

[...]

7. [...]

[...]

15. Dissolution and winding up

1. [...]

[...]

7. [...]

1. [...]

1. If this time limit is breached the Ministry of Trade and Finance shall pay $1,000 for every begun hour in violation

1. [...]

2. [...] ”

(2) Section 8 - Limited Liability Corporation shall be amended in the following manner:

“5. Formation:

1. [...]

2. [...]

1. The Ministry of Trade and Finance shall be liable to pay $50 every begun day exceeding the limit.

1. [...]

3. [...]

[...]

6. [...]

[...]

14. Dissolution and winding up

1. [...]

[...]

7. [...]

1. [...]

1. If this time limit is breached the Ministry of Trade and Finance shall pay $1,000 for every begun hour in violation

1. [...]

2. [...] ”

12 - Severability

(1) The provisions of this act are severable. Should one part of it be declared unconstitutional, it shall not affect the parts which remain.

ConsequencesInc · 2026-05-04T03:38:15-0400

The Traffic Light Coalition
Moves to Pass
The Bankruptcy Unification and Tort Totalization Act

The Parliament observes the facts below:

(1) That particular individuals and entities may enter into contractual obligations which they are, at times, unable to fulfill;

(2) That a structured legal framework for the administration of bankruptcy is necessary to ensure fairness, order, and consistency in the resolution of such obligations.

Based on this, the Parliament decides:

(1) To enact the Bankruptcy Unification and Tort Totalization Act in order to establish clear procedures and standards governing personal and corporate bankruptcy.

To fulfil this, Parliament projects the following expenses:

(1) The continued collection of court fees for civil proceedings, as previously established under the Actual Judicial Reform Act;

(2) The allocation of additional funds to support the operations of the Magistrates’ Court.

Further, Parliament projects the following administrative efforts:

(1) That the Judiciary shall assume responsibility for the administration and adjudication of matters arising under bankruptcy law.

To implement the above, Parliament passes:
A
BILL
TO
Provide for the Definition and Administration of Bankruptcy and Related Torts

1 - About this Act

(1) This Act

(a) May be cited as ‘The Bankruptcy Unification and Tort Totalization Act’ (the “BUTT Act”).

(b) May be numbered as P.B.04-043.

(c) Shall be enacted upon receiving assent from His Majesty the King

(d) Has been authored by ConsequencesInc and bernard_madoff.

(e) Has been co-sponsored by bernard_madoff

2 - Definitions

(1) “Creditor” means any particular individual or entity to whomst a recognized obligation or debt is owed.

(2) “Debtor” means any particular individual or entity that owes a recognized obligation or debt to creditor

(3) “Asset(s)” means any cash, property and/or investments that a particular individual or entity owns.

“Liabilities” means all debts and obligations that a particular individual or entity owes to creditor

(4) “Equity” means the total of all of a debtor's assets minus all of a debtor's liabilities.

(5) “Cash” means SC Pounds (£) and DC Dollars ($), held either in a player’s account or in a bank/Financial institution.

(6) “Property” means any plots, buildings, and item(s) that a particular individual or entity owns, or is held in trust for them by another entity.

(7) “Investments” means any stocks, commodities, bonds, loans, plots designated for renting, or any other financial instrument held by a particular individual or entity for the purpose of generating future income, profit or value.

(8) “Good Faith” means a demonstrable and ongoing effort by any particular individual or entity(s) to cooperate with the Courts, creditor, and debtors in order to resolve and repay outstanding obligations.

(9) “Bankruptcy coefficient” means the total assets of a debtor divided by the total liabilities, rounded to the nearest hundredth.

(10) “EBITDA” means earnings before the deduction of interest, taxes, depreciation, and amortization. It is a non-GAAP calculation based on data from a company's income statement used to measure a company's operating profitability.

3 - Bankruptcy Filings

(1) Bankruptcy proceedings may be filed before the Magistrates Court either:

(a) Voluntarily by the particular individual or entity responsible for the debt; or

(b) At the request of one or more creditor.

(i) A request by a creditor must include proof of at least two (2) attempts to contact the debtor regarding repayment through at least two (2) of the following channels:

Private discord DM
In-game mail
Announcement in #legal channel in SC.