Section 38
Priority of debts
(1)
In the distribution of the property of a bankrupt, there shall be paid in priority to all other debts -
(a)
all rates due under the provisions of the Municipal Boards
Act (Chapter 57) from the bankrupt at the date of the date of the receiving order and having become due and payable within 12
months next before that time;
(b)
income tax assessed on the bankrupt up to the 3 1 st day of
December next before the date of the receiving order and not exceeding in the whole one year's assessment;
(c)
all wages or salary of any clerk, servant, labourer or workman not exceeding $1,000 for each whether payable for time
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or piece work or whether or not payable wholly or in part by way of commission in respect of services rendered to the bankrupt during the period of 5 months next before the date of the receiving order or the date of the termii~ation of his service if the latter occurs within 12 months of and precedes the date of the receiving order:
Provided that, without prejudice to the conditions and restrictions imposed upon contracts and agreements to labour by the
Employment Order, 2009 (S 3712009), where any clerk, servant, labourer or workman has entered into a contract for the payment of his wages or any part thereof in a lump sum at the end of the year of hiring, the priority under this section shall extend to the whole of such sum or a part thereof, as the Court may decide to be due under the contract, proportionate to the time of service up to the date of the receiving order;
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(d)
all amounts due in respect of contributions payable during 12 months next before, on or after the commencement of the date of the receiving order as the employer of any person under any written law relating to employees' superannuation or provident funds or under any scheme of superannuation which is an approved scheme under any other written law or any regulations made thereunder.
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(2)
The debts mentioned in subsection (1) shall rank equally between themselves and shall be paid in full unless the property of the bankrupt is insufficient to meet them, in which case they shall abate in equal proportions between themselves.
(3)
Subject to the provisions contained in section 37 and to the retention of such sums as may be necessary for the costs of administration or otherwise, the debts mentioned in subsection (1) shall be discharged forthwith so far as the property of the debtor is sufficient to meet them.
(4)
In the event of a landlord or other person distraining or having distrained on any goods or effects of a bankrupt within 3 months next before the date of the receiving order, the debts to which priority is given by this section shall be a first charge on the goods or effects so distrained on or the proceeds of the sale thereof:
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Provided that in respect of any money paid under any such charge, the landlord or other person shall have the same rights of priority as the person to whom such payment is made.
(5)
This section applies in the case of a deceased person who dies insolvent as if he were a bankrupt and as if the date of his death were substituted for the date of the receiving order.
(6)
In the case of partners, the joint estate shall be applicable in the first instance in payment of their joint debts and the separate estate of each partner shall be applicable in the first instance in payment of his separate debts.
(b)
If there is a surplus of the separate estates, it shall be dealt with as part of the joint estate.
(c)
If there is a surplus of the joint estate, it shall be dealt with as part of the respective separate estates in proportion to the right and interest of each partner in the joint estate.
(7)
Subject to the provisions of this Act, all debts proved in the bankruptcy shall be paid pari passu.
(8)
If there is any surplus after payment of the foregoing debts, it shall be applied in payment of interest from the date of the receiving at the rate of 8 per cent per annum on all debts proved in the bankruptcy.