The Insolvency (Amendment) Rules (Northern Ireland) 2006

(6.212A) (1) Where the official receiver intends to file a notice that an investigation of the conduct and affairs of a bankrupt is unnecessary or concluded under Article 253(2), he shall give notice in writing to all creditors of which he is aware and any trustee of his intention to file such a notice. (2) Where a creditor or a trustee receives written notice of the official receiver’s intention to file a notice under Article 253(2) and he has any objection to the official receiver filing such a notice, he may, within 28 days of the date of such written notice, inform the official receiver in writing of his objection and give reasons for that objection. (3) The official receiver shall not file a notice under Article 253(2) until the period allowed for creditors or a trustee to object under paragraph (2) has expired. (4) Where the official receiver receives no objection from either a creditor or a trustee he may file a notice under Article 253(2) by sending to the court two copies of Form 6.85. - [Form 6.85] (5) The court shall endorse each copy with the date of filing and shall return one copy to the official receiver. (6) The official receiver shall send a copy of the endorsed form to the bankrupt. (7) Where the official receiver receives an objection under this Rule and he rejects that objection, he shall not file the notice under Article 253(2) until he has— (a) given notice of the rejection (and his reasons) to the complainant; and (b) the period of time for an appeal by the complainant under Rule 7.44(2) has expired, or an appeal under that Rule has been determined by the court. - [E.R. 6.214A]

Substitution of Rule 6.213

84

For Rule 6.213 there shall be substituted—

(6.213) (1) This Rule applies where the official receiver or any trustee who is not the official receiver applies to the court for an order under Article 253(3) (suspension of automatic discharge), but not where the official receiver makes that application, pursuant to Rule 6.173(4), on the adjournment of the bankrupt’s public examination. (2) The official receiver or any trustee who is not the official receiver shall, with his application, file evidence in support setting out the reasons why it appears to him that such an order should be made. (3) The court shall fix a venue for the hearing of the application, and give notice of it to the official receiver, any trustee who is not the official receiver, and the bankrupt. (4) Copies of the official receiver’s evidence in support under this Rule shall be sent by him to the bankrupt and any trustee who is not the official receiver, so as to reach them at least 21 days before the hearing date. (5) Copies of the trustee’s evidence in support under this Rule shall be sent by him to the official receiver and the bankrupt, so as to reach them at least 21 days before the hearing date. (6) The bankrupt may, not later than 7 days before the hearing date, file in court a notice specifying any statements in the official receiver’s or trustee’s evidence in support which he intends to deny or dispute. (7) If the bankrupt files a notice under paragraph (6) of this Rule, he shall send copies of it, not less than 4 days before the hearing date, to the official receiver and any trustee who is not the official receiver. (8) If the court makes an order suspending the bankrupt’s discharge, copies of the order shall be sent by the court to the official receiver, any trustee who is not the official receiver and the bankrupt. - [E.R. 6.215]

Substitution of Rule 6.214

85

For Rule 6.214 there shall be substituted—

(6.214) (1) Where the court has made an order under Article 253(3) that the period specified in Article 253(1) shall cease to run, the bankrupt may apply to it for the order to be discharged. (2) The court shall fix a venue for the hearing of the application; and the bankrupt shall, not less than 28 days before the hearing date, give notice of the venue to the official receiver and any trustee who is not the official receiver, accompanied in each case by a copy of the application. (3) The official receiver and the trustee may appear and be heard on the bankrupt’s application; and, whether or not they appear, the official receiver and trustee may file in court evidence in support of any matters which either of them considers ought to be drawn to the court’s attention. (4) If the court made an order under Article 253(3)(b), the court may request a report from the official receiver or the trustee as to whether the conditions specified in the order have or have not been fulfilled. (5) If a report is filed under paragraph (3) or (4), copies of it shall be sent by the official receiver or trustee to the bankrupt and to either the official receiver or trustee (depending on which has filed the report), not later than 14 days before the hearing date. (6) The bankrupt may, not later than 7 days before the hearing date, file in court a notice specifying any statements in the official receiver’s or trustee’s report which he intends to deny or dispute. (7) If the bankrupt files a notice under paragraph (6), he shall send copies of it, not less than 4 days before the hearing date, to the official receiver and the trustee. (8) If on the bankrupt’s application the court discharges the order under Article 253(3) (being satisfied that the period specified in Article 253(1) should begin to run again), it shall issue to the bankrupt a certificate that it has done so, with effect from a specified date and shall send copies of the certificate to the official receiver and the trustee. - [E.R. 6.216]

Amendment to Rule 6.215

86

In Rule 6.215—

• (a) for the heading to Rule 6.215 there shall be substituted, “Application by bankrupt solicitor for discharge”;

• (b) in paragraph (1) for the words “the bankrupt” there shall be substituted, “a bankrupt who is a solicitor”;

• (c) in paragraph (3)(c) the words, “where the bankruptcy order was made against a solicitor” shall be omitted.

Amendment to Rule 6.216

87

In Rule 6.216—

• (a) in paragraph (1) for the words “the bankrupt” there shall be substituted, “a bankrupt who is a solicitor”;

• (b) in paragraph (5) the words, “, where the bankruptcy order was made against a solicitor,” shall be omitted.

Amendment to Rule 6.221

88

In Rule 6.221 there shall be inserted after “1990” the words “or under Parts 2, 3 or 4 of the Proceeds of Crime Act 2002.”.

Amendment to Rule 6.222

89

In Rule 6.222—

• (a) in paragraph (1)(c) after the words “under Article 361” there shall be inserted the words “or 361A”, and

• (b) in paragraph (1)(o) for the words “to the official receiver under general regulations” there shall be substituted “under Schedule 4”.

Insertion of new Rule 6.227A

90

After Rule 6.227 there shall be inserted—

(6.227A) (1) This Rule applies where the official receiver or trustee in bankruptcy applies to the court under Article 342(1) (re-direction of bankrupt’s letters etc). (2) The application shall be made without notice to the bankrupt or any other person, unless the court directs otherwise. (3) The applicant shall with his application, where he is the official receiver, file a report, and where he is the trustee in bankruptcy, an affidavit, setting out the reasons why such an order is sought. (4) The court shall fix a venue for the hearing of the application if the court thinks fit and give notice to the applicant. (5) The court may make an order on such conditions as it thinks fit. (6) The order shall identify the person on whom it is to be served, and need not be served on the bankrupt unless the court directs otherwise. - [E.R. 6.235A]

Substitution of Rule 6.229

91

For Rule 6.229 there shall be substituted—

(6.229) (1) Where it appears to a trustee that Article 256A(1) applies, the trustee shall give notice in Form 6.86 as soon as reasonably practicable to— - [Form 6.86] the bankrupt; the bankrupt’s spouse or civil partner (in a case falling within Article 256A(1)(b)); and a former spouse or former civil partner of the bankrupt (in a case falling within Article 256A(1)(c)). (2) A notice under paragraph (1) shall contain— (a) the name of the bankrupt; (b) the address of the dwelling-house; and (c) if the dwelling-house is registered land, the folio number. (3) A trustee shall not give notice under paragraph (1) any later than 14 days before the expiry of the three year period under Article 256A(2) or 256A(5). - [E.R. 6.237] (6.229A) (1) Paragraph (2) shall apply where— (a) property comprised in the bankrupt’s estate consists of an interest in a dwelling-house which at the date of bankruptcy was the sole or principal residence of— (i) the bankrupt; (ii) the bankrupt’s spouse or civil partner; or (iii) a former spouse or former civil partner of the bankrupt; and (b) title to the dwelling-house is registered; and (c) an entry has been made, or entries have been made, in the individual register or registers in which title to the dwelling-house is registered relating to the bankrupt’s bankruptcy or the individual register or registers has or have been altered to reflect the vesting of the bankrupt’s interest in a trustee in bankruptcy. (2) Where an interest of a kind mentioned in paragraph (1) ceases to be comprised in the bankrupt’s estate and vests in the bankrupt under either Article 256A(2) or 256A(4) of the Order, or under Article 17(7) of the Insolvency (Northern Ireland) Order 2005, the trustee shall, within 7 days of the date of the vesting, make such application or applications to the Registrar of Titles as shall be necessary to show on the appropriate register that the interest in the dwelling-house has vested in the bankrupt. (3) An application under paragraph (2) shall be made in accordance with the Land Registration Act (Northern Ireland) 1970[^f00009] and shall be accompanied by— (a) evidence of the trustee’s appointment (where not previously provided to the Registrar of Titles); and (b) a certificate from the trustee stating that the interest has vested in the bankrupt under Article 256A(2) or 256A(4) of the Order or Article 17(7) of the Insolvency (Northern Ireland) Order 2005 (whichever is appropriate). (4) As soon as reasonably practicable after making an application under paragraph (2) of this Rule, the trustee shall notify the bankrupt and if the dwelling-house was the sole or principal residence of his spouse or former spouse or civil partner or former civil partner, such person, that the application has been made. (5) The trustee shall notify every person who (to his knowledge) either claims an interest in the dwelling-house, or is under any liability in respect of the dwelling-house that an application has been made. - [E.R. 6.237A] (6.229B) (1) Where an interest in a dwelling-house which at the date of the bankruptcy was the sole or principal residence of— (a) the bankrupt; (b) the bankrupt’s spouse or civil partner; or (c) a former spouse or former civil partner of the bankrupt, ceases to be comprised in the bankrupt’s estate and vests in the bankrupt under either Article 256A(2) or 256A(4) of the Order or Article 17(7) of the Insolvency (Northern Ireland) Order 2005 and title to the dwelling-house is unregistered land, the trustee shall issue the bankrupt with a certificate as to the vesting in Form 6.87 as soon as reasonably practicable. - [Form 6.87] (2) A certificate issued under paragraph (1) shall be conclusive proof that the interest mentioned in paragraph (1) has vested in the bankrupt. (3) The trustee shall lodge in the registry of deeds a certificate as required by section 3(4) of the Registration of Deeds Act (Northern Ireland) 1970. (4) As soon as reasonably practicable after issuing the certificate under paragraph (1) the trustee shall, if the dwelling-house was the sole or principal residence of the bankrupt’s spouse or former spouse or civil partner or former civil partner, notify such person, that the certificate has been issued. (5) The trustee shall notify every person who (to his knowledge) either claims an interest in the dwelling-house, or is under any liability in respect of the dwelling-house that a certificate has been issued. - [E.R. 6.237B] (6.229C) The court may substitute for the period of three years mentioned in Article 256A(2) such longer period as the court thinks just and reasonable in all the circumstances of the case. - [E.R. 6.237C] (6.229D) For the purposes of Article 256A(2) for the period of three years set out therein there shall be substituted, where the trustee in bankruptcy has sent notice to the bankrupt that he considers— (a) the continued vesting of the property in the bankrupt’s estate to be of no benefit to creditors; or (b) the re-vesting to the bankrupt will facilitate a more efficient administration of the bankrupt’s estate, the period of one month from the date of that notice. - [E.R. 6.237CA] (6.229E) (1) This Rule applies where the trustee applies to the court under Article 286 for an order imposing a charge on property consisting of an interest in a dwelling-house. (2) The respondents to the application shall be— (a) any spouse or former spouse or civil partner or former civil partner of the bankrupt having or claiming to have an interest in the property; - [Form 6.82] any other person appearing to have an interest in the property; and such other persons as the court may direct. (3) The trustee shall make a report to the court, containing the following particulars— (a) the extent of the bankrupt’s interest in the property which is the subject of the application; (b) the amount which, at the date of the application, remains owing to unsecured creditors of the bankrupt; and (c) an estimate of the cost of realising the interest. (4) The terms of the charge to be imposed shall be agreed between the trustee and the bankrupt or, failing agreement, shall be settled by the court. (5) The rate of interest applicable under Article 286(2) is the rate applicable to a money judgement of the High Court on the day on which the charge is imposed, and the rate so applicable shall be stated in the court’s order imposing the charge. (6) The court’s order shall also— (a) describe the property to be charged; (b) state whether the title to the property is registered and, if it is, specify the folio number; (c) set out the extent of the bankrupt’s interest in the property which has vested in the trustee; (d) indicate, by reference to any, or the total, amount which is payable otherwise than to the bankrupt out of the estate and of interest on that amount, how the amount of the charge to be imposed is to be ascertained; (e) set out the conditions (if any) imposed by the court under Article 286(4); and (f) identify the date any property charged under Article 286 shall cease to be comprised in the bankrupt’s estate and shall, subject to the charge (and any prior charge), vest in the bankrupt. (7) Unless the court is of the opinion that a different date is appropriate, the date referred to in paragraph (6)(f) shall be that of the registration of the order in the Land Registry or the Registry of Deeds, as the case may be. (8) Where the court order is capable of giving rise to an application or applications under the Land Registration Act (Northern Ireland) 1970, the trustee shall, as soon as reasonably practicable after the making of the court order or at the appropriate time, make the appropriate application or applications to the Registrar of Titles. (9) In paragraph (8) an “appropriate application” is an application under the Land Registration Act (Northern Ireland) 1970 for an entry in the register in respect of the charge imposed by the order; and such application under that Act as shall be necessary to have the registration of title in respect of the dwelling-house noted that the interest has vested in the bankrupt. (10) In determining the value of the bankrupt’s interest for the purposes of paragraph (6)(c), the court shall disregard that part of the value of the property in which the bankrupt’s interest subsists which is equal to the value of— (a) any loans secured by mortgage or other charge against the property; (b) any other third party interest; and (c) the reasonable costs of sale. - [E.R. 6.237D] (6.229F) (1) In Rules 6.229 and 6.229A, “registered land” means any land title to which has been registered in accordance with the provisions of Part III of the Land Registration Act (Northern Ireland) 1970. (2) In Rule 6.229A, “individual register” has the same meaning as in the Land Registration Rules 2003. - [E.R. 6.237E]

Insertion of new Chapters 27, 28 and 29 of Part 6 of the principal Rules

92

After Chapter 26 of Part 6 of the principal Rules there shall be inserted—

(6.233) In this and the following two Chapters, “the Department” includes the official receiver acting in accordance with paragraph 1(2)(b) of Schedule 2A to the Order. - [E.R. 6.240] (6.234) (1) Where the Department applies to the court for a bankruptcy restrictions order under paragraph 1 of Schedule 2A to the Order, the application shall be supported by a report by the Department. (2) The report shall include— (a) a statement of the conduct by reference to which it is alleged that it is appropriate for a bankruptcy restrictions order to be made; and (b) the evidence on which the Department relies in support of the application. (3) Any evidence in support of an application for a bankruptcy restrictions order provided by persons other than the Department shall be by way of affidavit. (4) The hearing date shall be no earlier than 8 weeks from the date when the court fixes the venue for the hearing. - [E.R. 6.241] (6.235) (1) The Department shall not more than 14 days after the date on which the application is made at court serve notice of the application and the venue fixed by the court on the bankrupt. (2) The notice served on the respondent shall be accompanied by a copy of the application, together with copies of the report by the Department, any other evidence filed with the court in support of the application, and an acknowledgement of service. (3) The respondent shall not more than 14 days after the date on which the application is served on him file in court an acknowledgement of service of the application indicating whether or not he contests the application. (4) Where the respondent has failed to file an acknowledgement of service and the time period for doing so has expired, the respondent may attend the hearing of the application but may not take part in the hearing unless the court gives permission. - [E.R. 6.242] (6.236) (1) If the bankrupt wishes to oppose the application, he shall within 28 days from the date of service on him of the application and evidence of the Department, file in court any evidence which he wishes the court to take into consideration. (2) If the bankrupt files evidence under paragraph (1) of this Rule, he shall, within 3 days of filing at the court, serve a copy of such evidence upon the Department . (3) The Department shall, within 14 days from receiving the copy of the bankrupt’s evidence, file in court any further evidence in reply it wishes the court to take into consideration and shall as soon as reasonably practicable serve a copy of that evidence upon the bankrupt. - [E.R. 6.243] (6.237) (1) The court may make a bankruptcy restrictions order against the bankrupt, whether or not the latter appears, and whether or not he has filed evidence in accordance with Rule 6.236. (2) Where the court makes a bankruptcy restrictions order, it shall send two sealed copies to the Department. (3) As soon as reasonably practicable after receipt of the sealed copies of the order, the Department shall send a sealed copy of the order to the bankrupt. - [E.R. 6.244] (6.238) (1) Where the Department applies for an interim bankruptcy restrictions order under paragraph 5 of Schedule 2A to the Order, the court shall fix a venue for the hearing. (2) Notice of an application for an interim bankruptcy restrictions order shall be given to the bankrupt at least 2 business days before the hearing date unless the court directs otherwise. - [E.R. 6.245] (6.239) (1) The Department shall file a report in court as evidence in support of any application for an interim bankruptcy restrictions order. (2) The report shall include evidence of the bankrupt’s conduct which is alleged to constitute the grounds for the making of an interim bankruptcy restrictions order and evidence of matters which relate to the public interest in making the order. (3) Any evidence provided in support of an application for an interim bankruptcy restrictions order by persons other than the Department shall be by way of affidavit. - [E.R. 6.246] (6.240) (1) The bankrupt may file in court any evidence which he wishes the court to take into consideration and may appear at the hearing for an interim bankruptcy restrictions order. (2) The court may make an interim bankruptcy restrictions order against the bankrupt, whether or not the latter appears, and whether or not he has filed evidence in accordance with paragraph (1) of this Rule. (3) Where the court makes an interim bankruptcy restrictions order, it shall, as soon as reasonably practicable, send two sealed copies to the Department. (4) As soon as reasonably practicable after receipt of the sealed copies of the order, the Department shall send a sealed copy of the order to the bankrupt. - [E.R. 6.247] (6.241) (1) A bankrupt may apply to the court to set aside an interim bankruptcy restrictions order. (2) An application by the bankrupt to set aside an interim bankruptcy restrictions order shall be supported by an affidavit stating the grounds on which the application is made. (3) Where a bankrupt applies under paragraph (1) of this Rule, to set aside an interim bankruptcy restrictions order, he shall not less than 7 days before the hearing date send to the Department,— (a) notice of his application; (b) notice of the venue; (c) a copy of his application; and (d) a copy of the supporting affidavit. (4) The Department may attend the hearing and call the attention of the court to any matters which seem to it to be relevant, and may itself give evidence or call witnesses. (5) Where the court sets aside an interim bankruptcy restrictions order it shall, as soon as is reasonably practicable, send two sealed copies of the order to the Department. (6) As soon as reasonably practicable after receipt of the sealed copies of the order, the Department shall send a sealed copy of the order to the bankrupt. - [E.R. 6.248] (6.242) A bankruptcy restrictions undertaking signed by the bankrupt shall be deemed to have been accepted by the Department for the purposes of paragraph 9 of Schedule 2A to the Order when the undertaking is signed on behalf of the Department. - [E.R. 6.249] (6.243) As soon as a bankruptcy restrictions undertaking has been accepted by the Department— (a) one copy each shall be sent to the bankrupt and the official receiver; and (b) one copy shall be filed in court. - [E.R. 6.250] (6.244) (1) An application under paragraphs 9(3)(a) or (b) of Schedule 2A to the Order shall be supported by an affidavit stating the grounds on which it is made. (2) The bankrupt shall give notice of the application and the venue, together with a copy of the affidavit supporting his application to the Department at least 28 days before the hearing date. (3) The Department may attend the hearing and call the attention of the court to any matters which seem to it to be relevant, and may itself give evidence or call witnesses. (4) The court shall send a sealed copy of any order annulling or varying the bankruptcy restrictions undertaking to the Department and the bankrupt. - [E.R. 6.251]

PART 7 — NEW PART 6A FOR INSERTION INTO THE PRINCIPAL RULES

93

After Part 6 of the principal Rules there shall be inserted—

(6A.1) (1) The Department shall create and maintain a register of matters relating to individual voluntary arrangements in accordance with the provisions of this Part (referred to in this Part as “the register of individual voluntary arrangements”). (2) The register referred to in paragraph 12 of Schedule 2A to the Order (referred to in this Part as “the bankruptcy restrictions register”) shall be maintained in accordance with the provisions of this Part. (3) In this Part the “registers” means the registers referred to in paragraphs (1) and (2) of this Rule. (4) The registers shall be open to public inspection on any business day between the hours of 9.00 am and 5.00 pm. (5) Where an obligation to enter information onto, or delete information from, the registers arises under this Part, that obligation shall be performed as soon as is reasonably practicable after it arises. - [E.R. 6A.1] (6A.2) (1) The Department shall enter onto the register of individual voluntary arrangements— (a) as regards any voluntary arrangement other than a voluntary arrangement under Article 237A any information— (i) that was required to be held on the register of individual voluntary arrangements maintained by the Department immediately prior to the coming into operation of this Rule and which relates to a voluntary arrangement which has not been completed or has not terminated on or before the date on which this Rule comes into operation; or (ii) that is sent to it in pursuance of Rule 5.28 or Rule 5.33; and (b) as regards any voluntary arrangement under Article 237A of which notice is given to it pursuant to Rule 5.44— (i) the name and address of the debtor; and (ii) the date on which the arrangement was approved by the creditors; and, (c) in the circumstances set out in (a) and (b), the debtor’s gender, date of birth and any name by which he was known, not being the name in which he has entered into the voluntary arrangement. (2) This Rule shall be subject to Rule 6A.3. - [E.R. 6A.2] (6A.3) The Department shall delete from the register of individual voluntary arrangements all information concerning an individual voluntary arrangement where— (a) he receives notice under Rule 5.29(5) or Rule 5.45(4) of the making of a revocation order in respect of the arrangement; or (b) he receives notice under Rule 5.33(3) or Rule 5.49(3) of the full implementation or termination of the arrangement. - [E.R. 6A.3] (6A.4) (1) Where an interim bankruptcy restrictions order or a bankruptcy restrictions order is made against a bankrupt, the Department shall enter onto the bankruptcy restrictions register— (a) the name, gender, occupation (if any) and date of birth of the bankrupt; (b) the bankrupt’s last known address; (c) a statement that an interim bankruptcy restrictions order or, as the case may be, a bankruptcy restrictions order has been made against him; (d) the date of the making of the order, and the court reference number; and (e) the duration of the order. (2) Where a bankruptcy restrictions undertaking is given by a bankrupt, the Department shall enter onto the bankruptcy restrictions register— (a) the name, gender, occupation (if any) and date of birth of the bankrupt; (b) the bankrupt’s last known address; (c) a statement that a bankruptcy restrictions undertaking has been given; (d) the date of the acceptance of the bankruptcy restrictions undertaking by the Department; and (e) the duration of the bankruptcy restrictions undertaking. (3) This Rule shall be subject to Rule 6A.5. - [E.R. 6A.6] (6A.5) In any case where an interim bankruptcy restrictions order or a bankruptcy restrictions order is made or a bankruptcy restrictions undertaking has been accepted, the Department shall remove from the bankruptcy restrictions register all information regarding that order or, as the case may be, undertaking after— (a) receipt of notification that the order or, as the case may be, the undertaking has ceased to have effect; or (b) the expiry of the order or, as the case may be, undertaking. - [E.R. 6A.7] (6A.6) (1) Where the Department becomes aware that there is any inaccuracy in any information maintained on the registers it shall rectify the inaccuracy as soon as reasonably practicable. (2) Where the Department receives notice of the date of the death of a bankrupt in respect of whom information is held on the register of individual voluntary arrangements or on the bankruptcy restrictions register, it shall cause the fact and date of the bankrupt’s death to be entered onto that register. - [E.R. 6A.8]

PART 8 — AMENDMENTS TO PART 7 OF THE PRINCIPAL RULES

Amendment to Rule 7.02

94

After paragraph (1)(e) of Rule 7.02 there shall be inserted—

(f) applications for bankruptcy restrictions orders and interim bankruptcy restrictions orders.

Amendment to Rule 7.03

95

• (1) In paragraph (1) of Rule 7.03 omit sub-paragraph (f).

• (2) For paragraph (6) there shall be substituted—

(6) The following rules of the Supreme Court Rules do not apply in insolvency proceedings— (a) except as provided by paragraph (7), Order 32, rule 11; and (b) Order 32, rule 12

• (3) After paragraph (6) there shall be inserted—

(7) In Order 32 of the Supreme Court Rules the exceptions from the powers of a master— (a) to hear proceedings under section 7(1)(a) of the Human Rights Act 1998 in respect of a judicial act, as defined in section 9(5) of that Act referred to in paragraph 1(O) of rule 11; and (b) to hear proceedings in which there is an issue which may lead to the Court considering whether to make a declaration of incompatibility under section 4 of the Human Rights Act 1998 shall apply to the Master (Bankruptcy) in relation to insolvency proceedings.

Amendments to Rule 7.05

96

In Rule 7.05 the words “a petition for” shall be omitted and in (a) there shall be inserted the words “an application for” before “an administration”, in (b) there shall be inserted the words “a petition for” before the words “a winding up” and in (c) there shall be inserted the words “a petition for” before the words “a bankruptcy”.

Insertion of new Rule 7.07A

97

After Rule 7.07 there shall be inserted—

(7.07A) (1) An application under Article 150A(5) shall be accompanied by an affidavit prepared and sworn by the liquidator, administrator or receiver. (2) The affidavit shall state— (a) the type of insolvency proceedings in which the application arises; (b) a summary of the financial position of the company; (c) the information substantiating the applicant’s view that the cost of making a distribution to unsecured creditors would be disproportionate to the benefits; and (d) whether any other insolvency practitioner is acting in relation to the company and if so his address. - [E.R. 7.3A]

Insertion of new Rule 7.08A

98

After Rule 7.08 there shall be inserted—

(7.08A) An application under Article 150A(5) may be made without the application being served upon or notice being given to any other party, save that notice of the application shall be given to any other insolvency practitioner who acts as such in relation to the company including any member State liquidator. - [E.R. 7.4A]

Amendments to Rule 7.20

99

In Rule 7.20—

• (a) in paragraph (1)(a) for “Article 34” there shall be substituted “paragraph 48 of Schedule B1 to the Order or Article”; and

• (b) in paragraph (2)(a) for “Article 34” there shall be substituted “paragraph 48 of Schedule B1 to the Order”.

Amendment to Rule 7.44

100

At the end of Rule 7.44 (which becomes paragraph (1)) there shall be inserted the following paragraph—

(2) In respect of a decision under Rule 6.212A(7)(b), an appeal shall be brought within 14 days of the notification of the decision.

Amendment to Rule 7.56

101

In Rule 7.56 at the end of paragraph (7) there shall be inserted—

(8) This Rule shall also apply where a company has moved to a voluntary liquidation in accordance with paragraph 84 of Schedule B1 to the Order.

PART 9 — AMENDMENTS TO PART 11 OF THE PRINCIPAL RULES

Amendment to Rule 11.13

102

• (1) For paragraph (2) of Rule 11.13 there shall be substituted—

(2) For the purpose of dividend (and no other purpose) the amount of the creditor’s admitted proof (or, if a distribution has previously been made to him, the amount remaining outstanding in respect of his admitted proof) shall be reduced by applying the following formula— $$X1.05n$ where— a “X” is the value of the admitted proof; and b “n” is the period beginning with the relevant date and ending with the date on which the payment of the creditor’s debt would otherwise be due expressed in years and months in a decimalised form.$ (3) In paragraph (2) “relevant date” means— (a) in the case of a winding up which was not immediately preceded by an administration, the date that the company went into liquidation; (b) in the case of a winding up which was immediately preceded by an administration, the date that the company entered administration; and (c) in the case of a bankruptcy, the date of the bankruptcy order.

• (2) Omit paragraph (3).

PART 10 — AMENDMENTS TO PART 12 OF THE PRINCIPAL RULES

Amendments to Rule 12.02

103

In Rule 12.02—

• (a) after the words “winding up” where they first appear, there shall be inserted “, administration” and after the words “winding up” where they appear for the second time, there shall be inserted “or the administration”; and

• (b) there shall be inserted as paragraph (2), and Rule 12.02 shall become Rule 12.02(1), the following—

(2) The costs associated with the prescribed part shall be paid out of the prescribed part.

Amendments to Rule 12.03

104

In Rule 12.03—

• (a) in paragraph (1) for the words “in both winding up and bankruptcy” there shall be substituted “in administration, winding up and bankruptcy”;

• (b) for sub-paragraph (a) of paragraph (2) there shall be substituted—

(a) in bankruptcy, any fine imposed for an offence, and any obligation (other than an obligation to pay a lump sum or to pay costs) arising under an order made in family proceedings or any obligation arising under a maintenance assessment made under the Child Support (Northern Ireland) Order 1991;

• (c) in sub-paragraph (b) of paragraph (2) before the words “winding up” there shall be inserted “administration,” and at the end after “1990” there shall be inserted the words “or under Parts 2, 3 or 4 of the Proceeds of Crime Act 2002”;

• (d) in paragraph (4) after “Article 160(2)” there shall be inserted “, Rule 2.089”;

• (e) in sub-paragraph (a) of paragraph (4) before the words “a winding up” there shall be inserted “an administration,”; and

• (f) in sub-paragraph (c) of paragraph (4) before the words “a winding up” where they occur for the first time there shall be inserted “an administration or” and after the word “bankruptcy” there shall be inserted “, an administration”.

Amendments to Rule 12.12

105

In Rule 12.12(1) after the words “Rule 12.11” there shall be inserted “and Rule 12.13”.

Insertion of new Rule 12.23

106

After Rule 12.22 there shall be inserted—

(12.23) (1) Where the court makes an order under Article 150A(5), it shall as soon as reasonably practicable send two sealed copies of the order to the applicant and a sealed copy to any other insolvency practitioner who holds office in relation to the company. (2) Where the court has made an order under Article 150A(5), the liquidator, administrator or receiver, as the case may be, shall, as soon as reasonably practicable, send a sealed copy of the order to the company. (3) Where the court has made an order under Article 150A(5), the liquidator, administrator or receiver, as the case may be, shall as soon as reasonably practicable, give notice to each creditor of whose claim and address he is aware. (4) Paragraph (3) shall not apply where the court directs otherwise. (5) The court may direct that the requirement in paragraph (3) is complied with by the liquidator, administrator or receiver, as the case may be, publishing a notice in such newspaper as he thinks most appropriate for ensuring that it comes to the notice of the company’s unsecured creditors stating that the court has made an order disapplying the requirement to set aside the prescribed part. (6) The liquidator, administrator or receiver shall send a copy of the order to the registrar as soon as reasonably practicable after the making of the order. - [E.R. 12.22]

Insertion of Schedule 4

107

After Schedule 3 there shall be inserted—

SCHEDULE 4 As regards the determination of the remuneration of trustees and liquidators the realisation and distribution scales are as set out in the table below—

SCHEDULE 2 — FORMS FOR INSERTION INTO SCHEDULE 2 TO THE PRINCIPAL RULES

PART A — FORMS FOR USE IN CONNECTION WITH ADMINISTRATION

PART B — NEW FORMS

PART C — SUBSTITUTED FORMS

Signed

Signed by authority of the Lord Chancellor

Bridget Prentice — Parliamentary Under Secretary of State, — Department for Constitutional Affairs — Dated 9th February 2006

The Department of Enterprise, Trade and Investment hereby concurs with the foregoing Rules.

Sealed with the Official Seal of the Department of Enterprise, Trade and Investment on 14th February 2006.

Michael J. Bohill — A senior officer of the — Department of Enterprise, Trade and Investment

The Department of Finance and Personnel hereby concurs with the foregoing Rules.

Sealed with the Official Seal of the Department of Finance and Personnel on 15th February 2006.

Mary McIvor — A senior officer of the — Department of Finance and Personnel

Explanatory note

(This note is not part of the Rules)

These Rules make a number of changes to the Insolvency Rules (Northern Ireland) 1991 (S.R. 1991 No. 364) (“the 1991 Rules”).

The changes to the 1991 Rules, the majority of which are set out in Schedule 1 of these Rules, are generally consequential on amendments made to the Insolvency (Northern Ireland) Order 1989 (S.I. 1989/2405 (N.I. 19)) by the Insolvency (Northern Ireland) Order 2005 (S.I. 2005/1455 (N.I. 10)).

The main amendment is the substitution of Part 2 of the 1991 Rules by the provisions set out in Part 2 of Schedule 1. This Part of the Schedule sets out the detailed rules for the administration procedure that was introduced as Schedule B1 to the Insolvency (Northern Ireland) Order 1989 by Article 3(2) of the Insolvency (Northern Ireland) Order 2005 in substitution for Part III of the Insolvency (Northern Ireland) Order 1989. The substituted Part 2 of the 1991 Rules draws substantially on the existing rules but makes new provisions in consequence of the revised and extended administration procedures introduced by the Insolvency (Northern Ireland) Order 2005. In particular, under Schedule B1:

• In addition to the existing route into administration by court order new entry routes will be provided for companies and their directors and for holders of qualifying floating charges, and these will be outside of the court.

• Administration will be subject to new time limits to ensure that the process is conducted quickly and efficiently. Administrators will have to send copies of their proposals to creditors within 8 weeks, and hold a creditors' meeting within 10 weeks. There will also be a time limit of 12 months as the initial maximum duration of the whole administration procedure and the administrator must fulfil his duties as soon as reasonably practicable. The administrator will be able to extend any of the time limits with the permission of the court, or with the consent of creditors.

• The administrator will be required to rescue the company, as a going concern, wherever this is reasonably practicable. In those cases where it is not possible, the objective will be to provide a better result for the creditors of the company as a whole than would be achieved in an immediate winding up and only where this is not possible will he or she realise property to make a distribution to secured or preferential creditors.

• The administrator will have powers to make payments to preferential and secured creditors in all circumstances, and to unsecured creditors with the permission of the court.

• The administrator will, on the filing of an appropriate notice, be able to move the company from administration into creditors' voluntary liquidation so that payments can be made to unsecured creditors without the leave of the court or, alternatively, to move from administration to dissolution in those cases where there are no further assets to be distributed.

Parts 1, 3, 4, and 10 of Schedule 1 make a number of amendments to the provisions in the 1991 Rules that relate to company voluntary arrangements, receiverships and liquidations, and rules of general application. These changes are consequential on the Insolvency (Northern Ireland) Order 2005 making a share of any assets subject to a floating charge known as the “prescribed part” available for unsecured creditors. These amendments concern the provision of information for creditors, the powers for receivers to deal with the “prescribed part” and applications to disapply the “prescribed part”. There are a number of minor amendments that are consequential on the introduction of the new administration procedure and the abolition of Crown preference by the Insolvency (Northern Ireland) Order 2005.

A modified Rule 12.03(2)(b) provides that any obligation arising as a result of an order made in family proceedings or any obligation arising under a maintenance assessment made under the Child Support (Northern Ireland) Order 1991,with the exception of lump sums or costs, is not provable in bankruptcy. Thus, lump sum and costs are now provable in bankruptcy proceeding whilst periodical payments continue to be non-provable.

Rule 4.096 in the 1991 Rules dealing with mutual credits and set-off has been replaced with a new version designed to provide greater detail and clarity of meaning for the user to reflect applicable case law, and to bring the rule on set-off for liquidation into line with new Rule 2.086 dealing with set-off in administration.

Rules 4.134, 4.135, 4.156, 6.135 and 6.136 are amended and Rules 4.134A, 4.134B, 4.156A, 6.135A and Schedule 4 are inserted to make provision as to the payment of remuneration to liquidators and trustees consequent on the amendments made to the Insolvency Regulations (Northern Ireland) 1996 (S.R.1996 No. 574). Originally the Rules made provision for the payment of remuneration of liquidators and trustees in certain circumstances on the basis set for the official receiver under the Insolvency Regulations (Northern Ireland) 1996. The official receiver’s entitlement to remuneration in those circumstances is revoked by the Insolvency (Amendment) Regulations (Northern Ireland) 2006 with the result that the substance of the revoked provisions in now repeated in the Insolvency Rules (Northern Ireland) 1991. Transitional provisions provide for the application of the former basis for remuneration to cases already on foot at the date these Rules come into operation.

Part 5 of Schedule 1 makes a number of amendments to the provisions of the 1991 Rules, which relate to individual voluntary arrangements. In particular, a number of amendments are made as a consequence of substituting a new Article 235 and the introduction of Articles 237A to 237G into the Insolvency (Northern Ireland) Order 1989. These principally relate to the introduction of a new “fast-track” individual voluntary arrangement, which will be available only to undischarged bankrupts and in which only the Official Receiver will act as nominee or supervisor. It also contains more detailed rules applying to annulment in cases where an individual voluntary arrangement has been approved and implemented.

Part 6 of Schedule 1 makes a number of amendments to the provisions of the 1991 Rules, which relate to bankruptcy. In particular—

• Rules and references to summary administration are omitted;

• Rules in relation to income payments agreements are included;

• Rules relating to discharge from bankruptcy are amended;

• Rules to deal with a bankrupt’s interest in a dwelling-house are revised; and

• Rules are introduced to implement the provisions on bankruptcy restrictions orders (This term is defined in Schedule 5 to the Insolvency (Northern Ireland) Order 2005 to include interim bankruptcy restrictions orders and bankruptcy restrictions undertakings).

Article 342 of the Insolvency (Northern Ireland) Order 1989 permits the court to make an order, on the application of the official receiver or the trustee of the bankrupt’s estate, for the redirection by a postal operator of a bankrupt’s post for a period not exceeding three months.

A new Rule, 6.227A, provides for procedure on an application for such an order and Form 6.83 is revised.

Postal redirection orders are typically sought only in cases of non-cooperation or where the applicant believes that a bankrupt has not made a full disclosure of his affairs (for example, in an attempt to conceal assets).

Part 7 of Schedule 1 introduces Part 6A into the 1991 Rules which relates to the registers by which individual voluntary arrangements are recorded and bankruptcy restrictions orders will be recorded.

Part 8 of Schedule 1 makes a number of amendments to the 1991 Rules which relate to court procedure and practice.

Part 9 of Schedule 1 amends, to take account of House of Lord’s criticism in Re Park Air Services Limited [2000] 2 AC 172, the formula quoted in Rule 11.13 of the 1991 Rules for use in a bankruptcy or winding-up to calculate the discounted value of a debt due for payment on a date subsequent to that on which a dividend is paid.

Schedule 2 makes a number of amendments to Schedule 2 to the 1991 Rules. New forms are introduced and other forms are revised in consequence of the matters set out in Schedule 1. Minor amendments are made to a few forms unrelated to the changes made by the Insolvency (Northern Ireland) Order 2005.

The costs to business of the commencement of the provisions of the Insolvency (Northern Ireland) Order 2005 are set out in the Regulatory Impact Assessment prepared for that Order. Copies of the assessment are available from the Insolvency Service, Fermanagh House, Ormeau Avenue, Belfast BT2 8NJ.

Footnotes

[^f00001]: The Insolvency (Northern Ireland) Order 1989 (S.I. 1989/2405 (N.I. 19)); to which the most recent relevant amendments were made by the Insolvency (Northern Ireland) Order 1989 (Amendment) Regulations (Northern Ireland) 2002 (S.R. 2002 No. 223)

[^f00002]: 1970 c. 25 (N.I.) as inserted by S.I. 1989/2405 (N.I. 19), Schedule 9, paragraph 9

[^f00003]: Formerly the Department of Economic Development, see the Departments (Northern Ireland) Order 1999 (S.I. 1999/283 (N.I. 1)

[^f00004]: The Insolvency Rules (Northern Ireland) 1991 (S.R. 1991 No. 364), as amended by the Insolvency (Amendment) Rules (Northern Ireland) 1994 (S.R. 1994 No. 26), the Insolvency (Amendment) Rules (Northern Ireland) 1995 (S.R. 1995 No. 291), the Insolvency (Amendment) Rules (Northern Ireland) 2000 (S.R. 2000 No. 247), the Insolvency (Amendment) Rules (Northern Ireland) 2002 (S.R. 2002 No. 261), the Insolvency (Amendment) Rules (Northern Ireland) 2003 (S.R. 2003 No. 549) and the Financial Services and Markets Act 2000 (Consequential Amendments) Order 2004 (S.I. 2004/355)

[^f00005]: S.I. 2005/1455 (N.I. 10)

[^f00006]: S.R. 1996 No. 574

[^f00007]: S.R. 2006 No. 23

[^f00008]: 1970 c. 25 (N.I.) as amended by S.I. 1989/2405 (N.I. 19), Schedule 9, paragraph 77

[^f00009]: 1970 c. 18 (N.I.)