Section 190 of Insolvency Act CAP 53: Contract terminated by other contracting party
(1) This section applies if the other party to a contract to which the bankrupt is a party, in accordance with a term of the contract, terminates the contract in consequence of the bankruptcy.
(2) Irrespective of what the contract provides, the bankruptcy trustee may recover such amount from the other contracting party as the Court considers to be fair and reasonable, but that amount may not be greater than the amount calculated in accordance with the formula in subsection (3).
(3) The formula is as follows:
A = B - C, where—
A is the amount to be calculated for the purpose of subsection (2);
B is the amount payable to the bankrupt under the contract; and
C is the total of—
(a) the amount paid to the bankrupt;
(b) the cost to complete the contract; and
(c) a reasonable amount as a penalty for delay in completing the contract.
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