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The Insolvency Rules 1986

Type Statutory-Instrument

Publication 1986-11-10

Last updated 1988-01-11

State In force

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Source legislation.gov.uk

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CHAPTER 11 — THE CREDITORS' COMMITTEE

Membership of creditors' committee

6.150

(1) The creditors' committee shall consist of at least 3, and not more than 5, members.

(2) All the members of the committee must be creditors of the bankrupt; and any creditor (other than one who is fully secured) may be a member, so long as—

(a) he has lodged a proof of his debt, and

(b) his proof has neither been wholly disallowed for voting purposes, nor wholly rejected for the purposes of distribution or dividend.

(3) A body corporate may be a member of the committee, but it cannot act as such otherwise than by a representative appointed under Rule 6.156.

Formalities of establishment

6.151

(1) The creditors' committee does not come into being, and accordingly cannot act, until the trustee has issued a certificate of its due constitution.

(2) If the chairman of the creditors' meeting which resolves to establish the committee is not the trustee, he shall forthwith give notice of the resolution to the trustee (or, as the case may be, the person appointed as trustee by that same meeting), and inform him of the names and addresses of the persons elected to be members of the committee.

(3) No person may act as a member of the committee unless and until he has agreed to do so and, unless the relevant proxy contains a statement to the contrary, such agreement may be given by his proxy-holder present at the meeting establishing the committee.

(3A) The trustee’s certificate of the committee’s due constitution shall not issue before at least 3 persons elected to be members of the committee have agreed to act.

(4) As and when the others (if any) agree to act, the trustee shall issue an amended certificate.

(5) The certificate, and any amended certificate, shall be filed in court by the trustee.

(6) If after the first establishment of the committee there is any change in its membership, the trustee shall report the change to the court.

Obligations of trustee to committee

6.152

(1) Subject as follows, it is the duty of the trustee to report to the members of the creditors' committee all such matters as appear to him to be, or as they have indicated to him as being, of concern to them with respect to the bankruptcy.

(2) In the case of matters so indicated to him by the committee, the trustee need not comply with any request for information where it appears to him that—

(a) the request is frivolous or unreasonable, or

(b) the cost of complying would be excessive, having regard to the relative importance of the information, or

(3) Where the committee has come into being more than 28 days after the appointment of the trustee, the latter shall report to them, in summary form, what actions he has taken since his appointment, and shall answer such questions as they may put to him regarding his conduct of the bankruptcy hitherto.

(4) A person who becomes a member of the committee at any time after its first establishment is not entitled to require a report to him by the trustee, otherwise than in summary form, of any matters previously arising.

(5) Nothing in this Rule disentitles the committee, or any member of it, from having access to the trustee's records of the bankruptcy, or from seeking an explanation of any matter within the committee's responsibility.

Meetings of the committee

6.153

(1) Subject as follows, meetings of the creditors' committee shall be held when and where determined by the trustee.

(2) The trustee shall call a first meeting of the committee to take place within 3 months of his appointment or of the committee's establishment (whichever is the later); and thereafter he shall call a meeting—

(a) if so requested by a member of the committee or his representative (the meeting then to be held within 21 days of the request being received by the trustee), and

(b) for a specified date, if the committee has previously resolved that a meeting be held on that date.

(3) The trustee shall give 7 days' notice in writing of the venue of any meeting to every member of the committee (or his representative, if designated for that purpose), unless in any case the requirement of the notice has been waived by or on behalf of any member.

Waiver may be signified either at or before the meeting.

The chairman at meetings

6.154

(1) The chairman at any meeting of the creditors' committee shall be the trustee, or a person appointed by him in writing to act.

(2) A person so nominated must be either—

(a) one who is qualified to act as an insolvency practitioner in relation to the bankrupt, or

(b) an employee of the trustee or his firm who is experienced in insolvency matters.

Quorum

6.155

A meeting of the committee is duly constituted if due notice of it has been given to all the members and at least 2 of the members are present or represented.

Committee-members' representatives

6.156

(1) A member of the creditors' committee may, in relation to the business of the committee, be represented by another person duly authorised by him for that purpose.

(2) A person acting as a committee-member's representative must hold a letter of authority entitling him so to act (either generally or specially) and signed by or on behalf of the committee-member, and for this purpose any proxy in relation to any meeting of creditors of the bankrupt shall, unless it contains a statement to the contrary, be treated as such a letter of authority to act generally signed by or on behalf of the committee-member.

(3) The chairman at any meeting of the committee may call on a person claiming to act as a committee-member's representative to produce his letter of authority, and may exclude him if it appears that his authority is deficient.

(4) No member may be represented by a body corporate, or by a person who is an undischarged bankrupt or is subject to a composition or arrangement with his creditors.

(5) No person shall—

(a) on the same committee, act at one and the same time as representative of more than one committee-member, or

(b) act both as a member of the committee and as representative of another member.

(6) Where the representative of a committee-member signs any document on the latter's behalf, the fact that he so signs must be stated below his signature.

(7) The acts of the committee are valid notwithstanding any defect in the appointment or qualifications of any committee-member’s representative.

Resignation

6.157

A member of the creditors' committee may resign by notice in writing delivered to the trustee.

Termination of membership

6.158

(1) A person's membership of the creditors' committee is automatically terminated if—

(a) he becomes bankrupt or compounds or arranges with his creditors, or

(b) at 3 consecutive meetings of the committee he is neither present nor represented (unless at the third of those meetings it is resolved that this Rule is not to apply in his case), or

(2) However, if the cause of termination is the member's bankruptcy, his trustee in bankruptcy replaces him as a member of the committee.

Removal

6.159

A member of the creditors' committee may be removed by resolution at a meeting of creditors, at least 14 days' notice having been given of the intention to move that resolution.

Vacancies

6.160

(1) The following applies if there is a vacancy in the membership of the creditors' committee.

(2) The vacancy need not be filled if the trustee and a majority of the remaining committee-members so agree, provided that the number of members does not fall below the minimum required by Rule 6.150(1).

(3) The trustee may appoint any creditor (being qualified under the Rules to be a member of the committee) to fill the vacancy, if a majority of the other members of the committee agree to the appointment and the creditor concerned consents to act.

(4) Alternatively, a meeting of creditors may resolve that a creditor be appointed (with his consent) to fill the vacancy. In this case at least 14 days' notice must have been given of a resolution to make such an appointment (whether or not of a person named in the notice).

(5) Where the vacancy is filled by an appointment made by a creditors' meeting at which the trustee is not present, the chairman of the meeting shall report to the trustee the appointment which has been made.

Voting rights and resolutions

6.161

(1) At any meeting of the committee, each member (whether present himself, or by his representative) has one vote; and a resolution is passed when a majority of the members present or represented have voted in favour of it.

(2) Every resolution passed shall be recorded in writing, either separately or as part of the minutes of the meeting. The record shall be signed by the chairman and kept with the records of the bankruptcy.

Resolutions by post

6.162

(1) In accordance with this Rule, the trustee may seek to obtain the agreement of members of the creditors' committee to a resolution by sending to every member (or his representative designated for the purpose) a copy of the proposed resolution.

(2) Where the trustee makes use of the procedure allowed by this Rule, he shall send out to members of the committee or their representatives (as the case may be) a copy of any proposed resolution on which a decision is sought, which shall be set out in such a way that agreement with or dissent from each separate resolution may be indicated by the recipient on the copy so sent.

(3) Any member of the committee may, within 7 business days from the date of the trustee sending out a resolution, require the trustee to summon a meeting of the committee to consider the matters raised by the resolution.

(4) In the absence of such a request, the resolution is deemed to have been carried in the committee if and when the trustee is notified in writing by a majority of the members that they concur with it.

(5) A copy of every resolution passed under this Rule, and a note that the concurrence of the committee was obtained, shall be kept with the records of the bankruptcy.

Trustee's reports

6.163

(1) The trustee shall, as and when directed by the creditors' committee (but not more often than once in any period of 2 months), send a written report to every member of the committee setting out the position generally as regards the progress of the bankruptcy and matters arising in connection with it, to which he (the trustee) considers the committee's attention should be drawn.

(2) In the absence of any such directions by the committee, the trustee shall send such a report not less often than once in every period of 6 months.

(3) The obligations of the trustee under this Rule are without prejudice to those imposed by Rule 6.152.

Expenses of members etc

6.164

The trustee shall defray out of the estate, in the prescribed order of priority, any reasonable travelling expenses directly incurred by members of the creditors' committee or their representatives in respect of their attendance at the committee's meetings, or otherwise on the committee's business.

Dealings by committee-members and others

6.165

(1) This Rule applies to—

(a) any member of the creditors' committee,

(b) any committee-member's representative,

(d) any person who has been a member of the committee at any time in the last 12 months.

(2) Subject as follows, a person to whom this Rule applies shall not enter into any transaction whereby he—

(a) receives out of the estate any payment for services given or goods supplied in connection with the estate's administration, or

(b) obtains any profit from the administration, or

(3) Such a transaction may be entered into by a person to whom this Rule applies—

(a) with the prior leave of the court, or

(b) if he does so as a matter of urgency, or by way of performance of a contract in force before the commencement of the bankruptcy, and obtains the court's leave for the transaction, having applied for it without undue delay, or

(c) with the prior sanction of the creditors' committee, where it is satisfied (after full disclosure of the circumstances) that the person will be giving full value in the transaction.

(4) Where in the committee a resolution is proposed that sanction be accorded for a transaction to be entered into which, without that sanction or the leave of the court, would be in contravention of this Rule, no member of the committee, and no representative of a member, shall vote if he is to participate directly or indirectly in the transaction.

(5) The court may, on the application of any person interested—

(a) set aside a transaction on the ground that it has been entered into in contravention of this Rule, and

(b) make with respect to it such other order as it thinks fit, including (subject to the following paragraph) an order requiring a person to whom this Rule applies to account for any profit obtained from the transaction and compensate the estate for any resultant loss.

(6) In the case of a person to whom this Rule applies as an associate of a member of the committee or of a committee-member's representative, the court shall not make any order under paragraph (5), if satisfied that he entered into the relevant transaction without having any reason to suppose that in doing so he would contravene this Rule.

(7) The costs of an application to the court for leave under this Rule do not fall on the estate, unless the court so orders.

Committee's functions vested in Secretary of State

6.166

(1) At any time when the functions of the creditors' committee are vested in the Secretary of State under section 302(1) or (2), requirements of the Act or the Rules about notices to be given, or reports to be made, to the committee by the trustee do not apply, otherwise than as enabling the committee to require a report as to any matter.

(2) Where the committee's functions are so vested under section 302(2), they may be exercised by the official receiver.

CHAPTER 12 — SPECIAL MANAGER

Appointment and remuneration

6.167

(1) An application made by the official receiver or trustee under section 370 for the appointment of a person to be special manager shall be supported by a report setting out the reasons for the application.

The report shall include the applicant's estimate of the value of the estate, property or business in respect of which the special manager is to be appointed.

(2) The court's order appointing the special manager shall specify the duration of his appointment, which may be for a period of time, or until the occurrence of a specified event. Alternatively, the order may specify that the duration of the appointment is to be subject to a further order of the court.

(3) The appointment of a special manager may be renewed by order of the court.

(4) The special manager's remuneration shall be fixed from time to time by the court.

Security

6.168

(1) The appointment of the special manager does not take effect until the person appointed has given (or, being allowed by the court to do so, undertaken to give) security to the person who applies for him to be appointed.

(2) It is not necessary that security shall be given for each separate bankruptcy; but it may be given either specially for a particular bankruptcy, or generally for any bankruptcy in relation to which the special manager may be employed as such.

(3) The amount of the security shall be not less than the value of the estate, property or business in respect of which he is appointed, as estimated by the applicant in his report under Rule 6.167(1).

(4) When the special manager has given security to the person applying for his appointment, that person's certificate as to the adequacy of the security shall be filed in court.

(5) The cost of providing the security shall be paid in the first instance by the special manager; but—

(a) where a bankruptcy order is not made, he is entitled to be reimbursed out of the property of the debtor, and the court may make an order on the debtor accordingly, and

(b) where a bankruptcy order is made, he is entitled to be reimbursed out of the estate in the prescribed order of priority.

Failure to give or keep up security

6.169

(1) If the special manager fails to give the required security within the time stated for that purpose by the order appointing him, or any extension of that time that may be allowed, the official receiver or trustee (as the case may be) shall report the failure to the court, which may thereupon discharge the order appointing the special manager.

(2) If the special manager fails to keep up his security, the official receiver or trustee shall report his failure to the court, which may thereupon remove the special manager, and make such order as it thinks fit as to costs.

(3) If an order is made under this Rule removing the special manager, or discharging the order appointing him, the court shall give directions as to whether any, and if so what, steps should be taken for the appointment of another special manager in his place.

Accounting

6.170

(1) The special manager shall produce accounts, containing details of his receipts and payments, for the approval of the trustee.

(2) The accounts shall be in respect of 3-month periods for the duration of the special manager's appointment (or for a lesser period, if his appointment terminates less than 3 months from its date, or from the date to which the last accounts were made up).

(3) When the accounts have been approved, the special manager's receipts and payments shall be added to those of the trustee.

Termination of appointment

6.171

(1) The special manager's appointment terminates if the bankruptcy petition is dismissed or if, an interim receiver having been appointed, the latter is discharged without a bankruptcy order having been made.

(2) If the official receiver or the trustee is of opinion that the employment of the special manager is no longer necessary or profitable for the estate, he shall apply to the court for directions, and the court may order the special manager's appointment to be terminated.

(3) The official receiver or the trustee shall make the same application if a resolution of the creditors is passed, requesting that the appointment be terminated.

CHAPTER 13 — PUBLIC EXAMINATION OF BANKRUPT

Order for public examination

6.172

(1) If the official receiver applies to the court, under section 290, for the public examination of the bankrupt, a copy of the court's order shall, forthwith after its making, be sent by the official receiver to the bankrupt.

(2) The order shall appoint a venue for the hearing, and direct the bankrupt's attendance thereat.

(3) The official receiver shall give at least 14 days' notice of the hearing—

(a) if a trustee has been nominated or appointed, to him;

(b) if a special manager has been appointed, to him; and

(c) subject to any contrary direction of the court, to every creditor of the bankrupt who is known to the official receiver or is identified in the bankrupt's statement of affairs.

(4) The official receiver may, if he thinks fit, cause notice of the order to be given, by public advertisement in one or more newspapers, at least 14 days before the day fixed for the hearing.

Order on request by creditors

6.173

(1) A request by a creditor to the official receiver, under section 290(2), for the bankrupt to be publicly examined shall be made in writing and be accompanied by—

(a) a list of the creditors concurring with the request and the amount of their respective claims in the bankruptcy,

(b) from each creditor concurring, written confirmation of his concurrence, and

Sub-paragraphs (a) and (b) do not apply if the requisitioning creditor's debt is alone sufficient, without the concurrence of others.

(2) Before an application to the court is made on the request, the requisitionist shall deposit with the official receiver such sum as the latter may determine to be appropriate by way of security for the expenses of the hearing of a public examination, if ordered.

(3) Subject as follows, the official receiver shall, within 28 days of receiving the request, make the application to the court required by section 290(2).

(4) If the official receiver is of opinion that the request is an unreasonable one in the circumstances, he may apply to the court for an order relieving him from the obligation to make the application otherwise required by that subsection.

(5) If the court so orders, and the application for the order was made ex parte, notice of the order shall be given forthwith by the official receiver to the requisitionist. If the application for an order is dismissed, the official receiver's application under section 290(2) shall be made forthwith on conclusion of the hearing of the application first mentioned.

Bankrupt unfit for examination

6.174

(1) Where the bankrupt is suffering from any mental disorder or physical affliction or disability rendering him unfit to undergo or attend for public examination, the court may, on application in that behalf, either stay the order for his public examination or direct that it shall be conducted in such manner and at such place as it thinks fit.

(2) Application under this Rule shall be made—

(a) by a person who has been appointed by a court in the United Kingdom or elsewhere to manage the affairs of, or to represent, the bankrupt, or

(b) by a relative or friend of the bankrupt whom the court considers to be a proper person to make the application, or

(3) Where the application is made by a person other than the official receiver, then—

(a) it shall, unless the bankrupt is a patient within the meaning of the Mental Health Act 1983, be supported by the affidavit of a registered medical practitioner as to the bankrupt's mental and physical condition;

(b) at least 7 days' notice of the application shall be given to the official receiver and the trustee (if any); and

(c) before any order is made on the application, the applicant shall deposit with the official receiver such sum as the latter certifies to be necessary for the additional expenses of any examination that may be ordered on the application.

An order made on the application may provide that the expenses of the examination are to be payable, as to a specified proportion, out of the deposit under sub-paragraph (c), instead of out of the estate.

(4) Where the application is made by the official receiver, it may be made ex parte, and may be supported by evidence in the form of a report by the official receiver to the court.

Procedure at hearing

6.175

(1) The bankrupt shall at the hearing be examined on oath; and he shall answer all such questions as the court may put, or allow to be put, to him.

(2) Any of the persons allowed by section 290(4) to question the bankrupt may, with the approval of the court (made known either at the hearing or in advance of it), appear by solicitor or counsel; or he may in writing authorise another person to question the bankrupt on his behalf.

(3) The bankrupt may at his own expense employ a solicitor with or without counsel, who may put to him such questions as the court may allow for the purpose of enabling him to explain or qualify any answers given by him, and may make representations on his behalf.

(4) There shall be made in writing such record of the examination as the court thinks proper. The record shall be read over either to or by the bankrupt, signed by him, and verified by affidavit at a venue fixed by the court.

(5) The written record may, in any proceedings (whether under the Act or otherwise) be used as evidence against the bankrupt of any statement made by him in the course of his public examination.

(6) If criminal proceedings have been instituted against the bankrupt, and the court is of opinion that the continuance of the hearing would be calculated to prejudice a fair trial of those proceedings, the hearing may be adjourned.

Adjournment

6.176

(1) The public examination may be adjourned by the court from time to time, either to a fixed date or generally.

(2) Where the examination has been adjourned generally, the court may at any time on the application of the official receiver or of the bankrupt—

(a) fix a venue for the resumption of the examination, and

(b) give directions as to the manner in which, and the time within which, notice of the resumed public examination is to be given to persons entitled to take part in it.

(3) Where application under paragraph (2) is made by the bankrupt, the court may grant it on terms that the expenses of giving the notices required by that paragraph shall be paid by him and that, before a venue for the resumed public examination is fixed, he shall deposit with the official receiver such sum as the latter considers necessary to cover those expenses.

(4) Where the examination is adjourned generally, the official receiver may, there and then, make application under section 279(3) (suspension of automatic discharge).

Expenses of examination

6.177

(1) Where a public examination of the bankrupt has been ordered by the court on a creditors' requisition under Rule 6.173, the court may order that the expenses of the examination are to be paid, as to a specified proportion, out of the deposit under Rule 6.173(2), instead of out of the estate.

(2) In no case do the costs and expenses of a public examination fall on the official receiver personally.

CHAPTER 14 — DISCLAIMER

Trustee's notice of disclaimer

6.178

(1) Where the trustee disclaims property under section 315, the notice of disclaimer shall contain such particulars of the property disclaimed as enable it to be easily identified.

(2) The notice shall be signed by the trustee and filed in court, with a copy. The court shall secure that both the notice and the copy are sealed and endorsed with the date of filing.

(3) The copy notice, so sealed and endorsed, shall be returned by the court to the trustee as follows—

(a) if the notice has been delivered at the offices of the court by the trustee in person, it shall be handed to him,

(b) if it has been delivered by some person acting on the trustee's behalf, it shall be handed to that person, for immediate transmission to the trustee, and

The court shall cause to be endorsed on the original notice, or otherwise recorded on the file, the manner in which the copy notice was returned to the trustee.

(4) For the purposes of section 315, the date of the prescribed notice is that which is endorsed on it, and on the copy, in accordance with this Rule.

Communication of disclaimer to persons interested

6.179

(1) Within 7 days after the day on which a copy of the notice of disclaimer is returned to him, the trustee shall send or give copies of the notice (showing the date endorsed as required by Rule 6.178) to the persons mentioned in paragraphs (2) to (5) below.

(2) Where the property disclaimed is of a leasehold nature, he shall send or give a copy to every person who (to his knowledge) claims under the bankrupt as underlessee or mortgagee.

(3) Where the disclaimer is of property in a dwelling-house, he shall send or give a copy to every person who (to his knowledge) is in occupation of, or claims a right to occupy, the house.

(4) He shall in any case send or give a copy of the notice to every person who (to his knowledge)—

(a) claims an interest in the disclaimed property, or

(b) is under any liability in respect of the property, not being a liability discharged by the disclaimer.

(5) If the disclaimer is of an unprofitable contract, he shall send or give copies of the notice to all such persons as, to his knowledge, are parties to the contract or have interests under it.

(6) If subsequently it comes to the trustee's knowledge, in the case of any person, that he has such an interest in the disclaimed property as would have entitled him to receive a copy of the notice of disclaimer in pursuance of paragraphs (2) to (5), the trustee shall then forthwith send or give to that person a copy of the notice.

But compliance with this paragraph is not required if—

(a) the trustee is satisfied that the person has already been made aware of the disclaimer and its date, or

(b) the court, on the trustee's application, orders that compliance is not required in that particular case.

(7) A notice or copy notice to be served on any person under the age of 18 in relation to the disclaimer of property in a dwelling-house is sufficiently served if sent or given to the parent or guardian of that person.

Additional notices

6.180

The trustee disclaiming property may, without prejudice to his obligations under sections 315 to 319 and Rules 6.178 and 6.179, at any time give notice of the disclaimer to any persons who in his opinion ought, in the public interest or otherwise, to be informed of it.

Duty to keep court informed

6.181

The trustee shall notify the court from time to time as to the persons to whom he has sent or given copies of the notice of disclaimer under the two preceding Rules, giving their names and addresses, and the nature of their respective interests.

Application for leave to disclaim

6.182

(1) Where under section 315(4) the trustee requires the leave of the court to disclaim property claimed for the bankrupt's estate under section 307 or 308, he may apply for that leave ex parte.

(2) The application must be accompanied by a report—

(a) giving such particulars of the property proposed to be disclaimed as enable it to be easily identified,

(b) setting out the reasons why, the property having been claimed for the estate, the court's leave to disclaim is now applied for, and

(3) If it is stated in the report that any person's consent to the disclaimer has been signified, a copy of that consent must be annexed to the report.

(4) The court may, on consideration of the application, grant the leave applied for; and it may, before granting leave—

(a) order that notice of the application be given to all such persons who, if the property is disclaimed, will be entitled to apply for a vesting or other order under section 320, and

(b) fix a venue for the hearing of the application under section 315(4).

Application by interested party under s. 316

6.183

(1) The following applies where, in the case of any property, application is made to the trustee by an interested party under section 316 (request for decision whether the property is to be disclaimed or not).

(2) The application—

(a) shall be delivered to the trustee personally or by registered post, and

(b) shall be made in the form known as “notice to elect”, or a substantially similar form.

(3) This paragraph applies in a case where the property concerned cannot be disclaimed by the trustee without the leave of the court.

If within the period of 28 days mentioned in section 316(1) the trustee applies to the court for leave to disclaim, the court shall extend the time allowed by that section for giving notice of disclaimer to a date not earlier than the date fixed for the hearing of the application.

Interest in property to be declared on request

6.184

(1) If, in the case of property which the trustee has the right to disclaim, it appears to him that there is some person who claims, or may claim, to have an interest in the property, he may give notice to that person calling on him to declare within 14 days whether he claims any such interest and, if so, the nature and extent of it.

(2) Failing compliance with the notice, the trustee is entitled to assume that the person concerned has no such interest in the property as will prevent or impede its disclaimer.

Disclaimer presumed valid and effective

6.185

Any disclaimer of property by the trustee is presumed valid and effective, unless it is proved that he has been in breach of his duty with respect to the giving of notice of disclaimer, or otherwise under sections 315 to 319, or under this Chapter of the Rules.

Application for exercise of court's powers under s.320

6.186

(1) This Rule applies with respect to an application by any person under section 320 for an order of the court to vest or deliver disclaimed property.

(2) The application must be made within 3 months of the applicant becoming aware of the disclaimer, or of his receiving a copy of the trustee's notice of disclaimer sent under Rule 6.179, whichever is the earlier.

(3) The applicant shall with his application file an affidavit—

(a) stating whether he applies under paragraph (a) of section 320(2) (claim of interest in the property), under paragraph (b) (liability not discharged) or under paragraph (c) (occupation of dwelling-house);

(b) specifying the date on which he received a copy of the trustee's notice of disclaimer, or otherwise became aware of the disclaimer; and

(4) The court shall fix a venue for the hearing of the application; and the applicant shall, not later than 7 days before the date fixed, give to the trustee notice of the venue, accompanied by copies of the application and the affidavit under paragraph (3).

(5) On the hearing of the application, the court may give directions as to other persons (if any) who should be sent or given notice of the application and the grounds on which it is made.

(6) Sealed copies of any order made on the application shall be sent by the court to the applicant and the trustee.

(7) In a case where the property disclaimed is of a leasehold nature, or is property in a dwelling-house, and section 317 or (as the case may be) section 318 applies to suspend the effect of the disclaimer, there shall be included in the court's order a direction giving effect to the disclaimer.

This paragraph does not apply if, at the time when the order is issued, other applications under section 320 are pending in respect of the same property.

CHAPTER 15 — REPLACEMENT OF EXEMPT PROPERTY

Purchase of replacement property

6.187

(1) A purchase of replacement property under section 308(3) may be made either before or after the realisation by the trustee of the value of the property vesting in him under the section.

(2) The trustee is under no obligation, by virtue of the section, to apply funds to the purchase of a replacement for property vested in him, unless and until he has sufficient funds in the estate for that purpose.

Money provided in lieu of sale

6.188

(1) The following applies where a third party proposes to the trustee that he (the former) should provide the estate with a sum of money enabling the bankrupt to be left in possession of property which would otherwise be made to vest in the trustee under section 308.

(2) The trustee may accept that proposal, if satisfied that it is a reasonable one, and that the estate will benefit to the extent of the value of the property in question less the cost of a reasonable replacement.

CHAPTER 16 — INCOME PAYMENTS ORDERS

Application for order

6.189

(1) Where the trustee applies for an income payments order under section 310, the court shall fix a venue for the hearing of the application.

(2) Notice of the application, and of the venue, shall be sent by the trustee to the bankrupt at least 28 days before the day fixed for the hearing, together with a copy of the trustee's application and a short statement of the grounds on which it is made.

(3) The notice shall inform the bankrupt that—

(a) unless at least 7 days before the date fixed for the hearing he sends to the court and to the trustee written consent to an order being made in the terms of the application, he is required to attend the hearing, and

(b) if he attends, he will be given an opportunity to show cause why the order should not be made, or an order should be made otherwise than as applied for by the trustee.

Action to follow making of order

6.190

(1) Where the court makes an income payments order, a sealed copy of the order shall, forthwith after it is made, be sent by the trustee to the bankrupt.

(2) If the order is made under section 310(3)(b), a sealed copy of the order shall also be sent by the trustee to the person to whom the order is directed.

Variation of order

6.191

(1) If an income payments order is made under section 310(3)(a), and the bankrupt does not comply with it, the trustee may apply to the court for the order to be varied, so as to take effect under section 310(3)(b) as an order to the payor of the relevant income.

(2) The trustee's application under this Rule may be made ex parte.

(3) Sealed copies of any order made on the application shall, forthwith after it is made, be sent by the court to the trustee and the bankrupt.

(4) In the case of an order varying or discharging an income payments order made under section 310(3)(b), an additional sealed copy shall be sent to the trustee, for transmission forthwith to the payor of the relevant income.

Order to payor of income: administration

6.192

(1) Where a person receives notice of an income payments order under section 310(3)(b), with reference to income otherwise payable by him to the bankrupt, he shall make the arrangements requisite for immediate compliance with the order.

(2) When making any payment to the trustee, he may deduct the appropriate fee towards the clerical and administrative costs of compliance with the income payments order.

He shall give to the bankrupt a written statement of any amount deducted by him under this paragraph.

(3) Where a person receives notice of an income payments order imposing on him a requirement under section 310(3)(b), and either—

(a) he is then no longer liable to make to the bankrupt any payment of income, or

(b) having made payments in compliance with the order, he ceases to be so liable,

he shall forthwith give notice of that fact to the trustee.

Review of order

6.193

(1) Where an income payments order is in force, either the trustee or the bankrupt may apply to the court for the order to be varied or discharged.

(2) If the application is made by the trustee, Rule 6.189 applies (with any necessary modification) as in the case of an application for an income payments order.

(3) If the application is made by the bankrupt, it shall be accompanied by a short statement of the grounds on which it is made.

(4) The court may, if it thinks that no sufficient cause is shown for the application, dismiss it; but it shall not do so unless the applicant has had an opportunity to attend the court for an ex parte hearing, of which he has been given at least 7 days' notice.

If the application is not dismissed under this paragraph, the court shall fix a venue for it to be heard.

(5) At least 28 days before the date fixed for the hearing, the applicant shall send to the trustee or the bankrupt (whichever of them is not himself the applicant) notice of the venue, accompanied by a copy of the application.

Where the applicant is the bankrupt, the notice shall be accompanied by a copy of the statement of grounds under paragraph (3).

(6) The trustee may, if he thinks fit, appear and be heard on the application; and, whether or not he intends to appear, he may, not less than 7 days before the date fixed for the hearing, file a written report of any matters which he considers ought to be drawn to the court's attention.

If such a report is filed, a copy of it shall be sent by the trustee to the bankrupt.

(7) Sealed copies of any order made on the application shall, forthwith after the order is made, be sent by the court to the trustee, the bankrupt and the payor (if other than the bankrupt).

CHAPTER 17 — ACTION BY COURT UNDER SECTION 369 ORDER TO INLAND REVENUE OFFICIAL

Application for order

6.194

(1) An application by the official receiver or the trustee for an order under section 369 (order to inland revenue official to produce documents) shall specify (with such particularity as will enable the order, if made, to be most easily complied with) the documents whose production to the court is desired, naming the official to whom the order is to be addressed.

(2) The court shall fix a venue for the hearing of the application.

(3) Notice of the venue, accompanied by a copy of the application, shall be sent by the applicant to the Commissioners of Inland Revenue (“the Commissioners”) at least 28 days before the hearing.

(4) The notice shall require the Commissioners, not later than 7 days before the date fixed for the hearing of the application, to inform the court whether they consent or object to the making of an order under the section.

(5) If the Commissioners consent to the making of an order, they shall inform the court of the name of the official to whom it should be addressed, if other than the one named in the application.

(6) If the Commissioners object to the making of an order, they shall secure that an officer of theirs attends the hearing of the application and, not less than 7 days before it, deliver to the court a statement in writing of their grounds of objection.

A copy of the statement shall be sent forthwith to the applicant.

Making and service of the order

6.195

(1) If on the hearing of the application it appears to the court to be a proper case, the court may make the order applied for, with such modifications (if any) as appear appropriate having regard to any representations made on behalf of the Commissioners.

(2) The order—

(a) may be addressed to an inland revenue official other than the one named in the application,

(b) shall specify a time, not less than 28 days after service on the official to whom the order is addressed, within which compliance is required, and

(3) A sealed copy of the order shall be served by the applicant on the official to whom it is addressed.

(4) If the official is unable to comply with the order because he has not the relevant documents in his possession, and has been unable to obtain possession of them, he shall deliver to the court a statement in writing as to the reasons for his non-compliance.

A copy of the statement shall be sent forthwith by the official to the applicant.

Custody of documents

6.196

Where in compliance with an order under section 369 original documents are produced, and not copies, any person who, by order of the court under section 369(2) (authorised disclosure to persons with right of inspection), has them in his possession or custody is responsible to the court for their safe keeping and return as and when directed.

CHAPTER 18 — MORTGAGED PROPERTY

Claim by mortgagee of land

6.197

(1) Any person claiming to be the legal or equitable mortgagee of land belonging to the bankrupt may apply to the court for an order directing that the land be sold.

“Land” includes any interest in, or right over, land.

(2) The court, if satisfied as to the applicant's title, may direct accounts to be taken and enquiries made to ascertain—

(a) the principal, interest and costs due under the mortgage, and

(b) where the mortgagee has been in possession of the land or any part of it, the rents and profits, dividends, interest, or other proceeds received by him or on his behalf.

Directions may be given by the court under this paragraph with respect to any mortgage (whether prior or subsequent) on the same property, other than that of the applicant.

(3) For the purpose of those accounts and enquiries, and of making title to the purchaser, any of the parties may be examined by the court, and shall produce on oath before the court all such documents in their custody or under their control relating to the estate of the bankrupt as the court may direct.

The court may under this paragraph authorise the service of interrogatories on any party.

(4) In any proceedings between a mortgagor and mortgagee, or the trustee of either of them, the court may order accounts to be taken and enquiries made in like manner as in the Chancery Division of the High Court.

Power of court to order sale

6.198

(1) The court may order that the land, or any specified part of it, be sold; and any party bound by the order and in possession of the land or part, or in receipt of the rents and profits from it, may be ordered to deliver up possession or receipt to the purchaser or to such other person as the court may direct.

(2) The court may permit the person having the conduct of the sale to sell the land in such manner as he thinks fit. Alternatively, the court may direct that the land be sold as directed by the order.

(3) The court's order may contain directions—

(a) appointing the persons to have the conduct of the sale;

(b) fixing the manner of sale (whether by contract conditional on the court's approval, private treaty, public auction, or otherwise);

(d) obtaining evidence of the value of the property, and fixing a reserve or minimum price;

(e) requiring particular persons to join in the sale and conveyance;

(f) requiring the payment of the purchase money into court, or to trustees or others;

(g) if the sale is to be by public auction, fixing the security (if any) to be given by the auctioneer, and his remuneration.

(4) The court may direct that, if the sale is to be by public auction, the mortgagee may appear and bid on his own behalf.

Proceeds of sale

6.199

(1) The proceeds of sale shall be applied—

(a) first, in payment of the expenses of the trustee, of and occasioned by the application to the court, of the sale and attendance threat, and of any costs arising from the taking of accounts, and making of enquiries, as directed by the court under Rule 6.197; and

(b) secondly, in payment of the amount found due to any mortgagee, for principal, interest and costs;

and the balance (if any) shall be retained by or paid to the trustee.

(2) Where the proceeds of the sale are insufficient to pay in full the amount found due to any mortgagee, he is entitled to prove as a creditor for any deficiency, and to receive dividends rateably with other creditors, but not so as to disturb any dividend already declared.

CHAPTER 19 — AFTER-ACQUIRED PROPERTY

Duties of bankrupt in respect of after-acquired property

6.200

(1) The notice to be given by the bankrupt to the trustee, under section 333(2), of property acquired by, or devolving upon, him, or of any increase of his income, shall be given within 21 days of his becoming aware of the relevant facts.

(2) Having served notice in respect of property acquired by or devolving upon him, the bankrupt shall not, without the trustee's consent in writing, dispose of it within the period of 42 days beginning with the date of the notice.

(3) If the bankrupt disposes of property before giving the notice required by this Rule or in contravention of paragraph (2), it is his duty forthwith to disclose to the trustee the name and address of the disponee, and to provide any other information which may be necessary to enable the trustee to trace the property and recover it for the estate.

(4) Subject as follows, paragraphs (1) to (3) do not apply to property acquired by the bankrupt in the ordinary course of a business carried on by him.

(5) If the bankrupt carries on a business, he shall, not less often than 6-monthly, furnish to the trustee information with respect to it, showing the total of goods bought and sold (or, as the case may be, services supplied) and the profit or loss arising from the business.

The trustee may require the bankrupt to furnish fuller details (including accounts) of the business carried on by him.

Trustee's recourse to disponee of property

6.201

(1) Where property has been disposed of by the bankrupt, before giving the notice required by Rule 6.200 or otherwise in contravention of that Rule, the trustee may serve notice on the disponee, claiming the property as part of the estate by virtue of section 307(3).

(2) The trustee's notice under this Rule must be served within 28 days of his becoming aware of the disponee's identity and an address at which he can be served.

Expenses of getting in property for the estate

6.202

Any expenses incurred by the trustee in acquiring title to after-acquired property shall be paid out of the estate, in the prescribed order of priority.

CHAPTER 20 — LEAVE TO ACT AS DIRECTOR, ETC

Application for leave

6.203

(1) An application by the bankrupt for leave, under section 11 of the Company Directors Disqualification Act 1986, to act as director of, or to take part or be concerned in the promotion, formation or management of a company, shall be supported by an affidavit complying with this Rule.

(2) The affidavit must identify the company and specify—

(a) the nature of its business or intended business, and the place or places where that business is, or is to be, carried on,

(b) whether it is, or is to be, a private or a public company,

(c) the persons who are, or are to be, principally responsible for the conduct of its affairs (whether as directors, shadow directors, managers or otherwise),

(d) the manner and capacity in which the applicant proposes to take part or be concerned in the promotion or formation of the company or, as the case may be, its management, and

(e) the emoluments and other benefits to be obtained from the directorship.

(3) If the company is already in existence, the affidavit must specify the date of its incorporation and the amount of its nominal and issued share capital; and if not, it must specify the amount, or approximate amount, of its proposed commencing share capital, and the sources from which that capital is to be obtained.

(4) Where the bankrupt intends to take part or be concerned in the promotion or formation of a company, the affidavit must contain an undertaking by him that he will, within not less than 7 days of the company being incorporated, file in court a copy of its memorandum of association and certificate of incorporation under section 13 of the Companies Act.

(5) The court shall fix a venue for the hearing of the bankrupt's application, and give notice to him accordingly.

Report of official receiver

6.204

(1) The bankrupt shall, not less than 28 days before the date fixed for the hearing, give to the official receiver and the trustee notice of the venue, accompanied by copies of the application and the affidavit under Rule 6.203.

(2) The official receiver may, not less than 14 days before the date fixed for the hearing, file in court a report of any matters which he considers ought to be drawn to the court's attention. A copy of the report shall be sent by him, forthwith after it is filed, to the bankrupt and to the trustee.

(3) The bankrupt may, not later than 7 days before the date of the hearing, file in court a notice specifying any statements in the official receiver's report which he intends to deny or dispute.

If he gives notice under this paragraph, he shall send copies of it, not less than 4 days before the date of the hearing, to the official receiver and the trustee.

(4) The official receiver and the trustee may appear on the hearing of the application, and may make representations and put to the bankrupt such questions as the court may allow.

Court's order on application

6.205

(1) If the court grants the bankrupt's application for leave under section 11 of the Company Directors Disqualification Act 1986, its order shall specify that which by virtue of the order the bankrupt has leave to do.

(2) The court may at the same time, having regard to any representations made by the trustee on the hearing of the application—

(a) include in the order provision varying an income payments order already in force in respect of the bankrupt, or

(b) if no income payments order is in force, make one.

(3) Whether or not the application is granted, copies of the order shall be sent by the court to the bankrupt, the trustee and the official receiver.

CHAPTER 21 — ANNULMENT OF BANKRUPTCY ORDER

Application for annulment

6.206

(1) An application to the court under section 282(1) for the annulment of a bankruptcy order shall specify whether it is made—

(a) under subsection (1)(a) of the section (claim that the order ought not to have been made), or

(b) under subsection (1)(b) (debts and expenses of the bankruptcy all paid or secured).

(2) The application shall, in either case, be supported by an affidavit stating the grounds on which it is made; and, where it is made under section 282(1)(b), there shall be set out in the affidavit all the facts by reference to which the court is, under the Act and the Rules, required to be satisfied before annulling the bankruptcy order.

(3) A copy of the application and supporting affidavit shall be filed in court; and the court shall give to the applicant notice of the venue fixed for the hearing.

(4) The applicant shall ... give to the official receiver and (if other) the trustee notice of the venue, accompanied by copies of the application and the affidavit under paragraph (2)

(a) where the application is made under section 282(1)(a), in sufficient time to enable them to be present at the hearing, and

(b) where the application is made under section 282(1)(b), not less than 28 days before the hearing.

(5) Where the application is made under section 282(1)(a), paragraph (4) shall additionally be complied with in relation to the person on whose petition the bankruptcy order was made.

Report by trustee

6.207

(1) The following applies where the application is made under section 282(1)(b) (debts and expenses of the bankruptcy all paid or secured).

(2) Not less than 21 days before the date fixed for the hearing, the trustee or, if no trustee has been appointed, the official receiver shall file in court a report with respect to the following matters—

(a) the circumstances leading to the bankruptcy;

(b) (in summarised form) the extent of the bankrupt's assets and liabilities at the date of the bankruptcy order and at the date of the present application;

(d) such other matters as the person making the report considers to be, in the circumstances, necessary for the information of the court.

(3) The report shall include particulars of the extent (if any) to which, and the manner in which, the debts and expenses of the bankruptcy have been paid or secured.

In so far as debts and expenses are unpaid but secured, the person making the report shall state in it whether and to what extent he considers the security to be satisfactory.

(4) A copy of the report shall be sent to the applicant at least 14 days before the date fixed for the hearing; and he may, if he wishes, file further affidavits in answer to statements made in the report.

Copies of any such affidavits shall be sent by the applicant to the official receiver and (if other) the trustee.

(5) If the trustee is other than the official receiver, a copy of his report shall be sent to the official receiver at least 21 days before the hearing. The official receiver may then file an additional report, a copy of which shall be sent to the applicant at least 7 days before the hearing.

Power of court to stay proceedings

6.208

(1) The court may, in advance of the hearing, make an interim order staying any proceedings which it thinks ought, in the circumstances of the application, to be stayed.

(2) Except in relation to an application for an order staying all or any part of the proceedings in the bankruptcy, application for an order under this Rule may be made ex parte.

(3) Where application is made under this Rule for an order staying all or any part of the proceedings in the bankruptcy, the applicant shall send copies of the application to the official receiver and (if other) the trustee in sufficient time to enable them to be present at the hearing and (if they wish to do so) make representations.

(4) Where the court makes an order under this Rule staying all or any part of the proceedings in the bankruptcy, the rules in this Chapter nevertheless continue to apply to any application for, or other matters in connection with, the annulment of the bankruptcy order.

(5) If the court makes an order under this Rule, it shall send copies of the order to the applicant, the official receiver and (if other) the trustee.

Notice to creditors who have not proved

6.209

Where the application for annulment is made under section 282(1)(b) and it has been reported to the court under Rule 6.207 that there are known creditors of the bankrupt who have not proved, the court may—

(a) direct the trustee or, if no trustee has been appointed, the official receiver to send notice of the application to such of those creditors as the court thinks ought to be informed of it, with a view to their proving their debts (if they so wish) within 21 days, and

(b) direct the trustee or, if no trustee has been appointed, the official receiver to advertise the fact that the application has been made, so that creditors who have not proved may do so within a specified time, and

The hearing

6.210

(1) The trustee shall attend the hearing of the application.

(2) The official receiver, if he is not the trustee, may attend, but is not required to do so unless he has filed a report under Rule 6.207.

(3) If the court makes an order on the application, it shall send copies of the order to the applicant, the official receiver and (if other) the trustee.

Matters to be proved under s.282(1)(b)

6.211

(1) This rule applies with regard to the matters which must, in an application under section 282(1)(b), be proved to the satisfaction of the court.

(2) Subject to the following paragraph, all bankruptcy debts which have been proved must have been paid in full.

(3) If a debt is disputed, or a creditor who has proved can no longer be traced, the bankrupt must have given such security (in the form of money paid into court, or a bond entered into with approved sureties) as the court considers adequate to satisfy any sum that may subsequently be proved to be due to the creditor concerned and (if the court thinks fit) costs.

(4) Where under paragraph (3) security has been given in the case of an untraced creditor, the court may direct that particulars of the alleged debt, and the security, be advertised in such manner as it thinks fit.

If advertisement is ordered under this paragraph, and no claim on the security is made within 12 months from the date of the advertisement (or the first advertisement, if more than one), the court shall, on application in that behalf, order the security to be released.

Notice to creditors

6.212

(1) Where the official receiver has notified creditors of the debtor's bankruptcy, and the bankruptcy order is annulled, he shall forthwith notify them of the annulment.

(2) Expenses incurred by the official receiver in giving notice under this Rule are a charge in his favour on the property of the former bankrupt, whether or not actually in his hands.

(3) Where any property is in the hands of a trustee or any person other than the former bankrupt himself, the official receiver's charge is valid subject only to any costs that may be incurred by the trustee or that other person in effecting realisation of the property for the purpose of satisfying the charge.

Other matters arising on annulment

6.213

(1) In an order under section 261 or 282 the court shall include provision permitting vacation of the registration of the bankruptcy petition as a pending action, and of the bankruptcy order, in the register of writs and orders affecting land.

(2) The court shall forthwith give notice of the making of the order to the Secretary of State.

(3) The former bankrupt may require the Secretary of State to give notice of the making of the order—

(a) in the Gazette, or

(b) in any newspaper in which the bankruptcy order was advertised, or

(4) Any requirement by the former bankrupt under paragraph (3) shall be addressed to the Secretary of State in writing. The Secretary of State shall notify him forthwith as to the cost of the advertisement, and is under no obligation to advertise until that sum has been paid.

(5) Where the former bankrupt has died, or is a person incapable of managing his affairs (within the meaning of Chapter 7 in Part 7 of the Rules), the references to him in paragraphs (3) and (4) are to be read as referring to his personal representative or, as the case may be, a person appointed by the court to represent or act for him.

Trustee's final account

6.214

(1) Where a bankruptcy order is annulled under section 261 or 282, this does not of itself release the trustee from any duty or obligation, imposed on him by or under the Act or the Rules, to account for all his transactions in connection with the former bankrupt's estate.

(2) The trustee shall submit a copy of his final account to the Secretary of State, as soon as practicable after the court's order annulling the bankruptcy order; and he shall file a copy of the final account in court.

(3) The final account must include a summary of the trustee's receipts and payments in the administration, and contain a statement to the effect that he has reconciled his account with that which is held by the Secretary of State in respect of the bankruptcy.

(4) The trustee is released from such time as the court may determine, having regard to whether—

(a) paragraph (2) of this Rule has been complied with, and

(b) any security given under Rule 6.211(3) has been, or will be, released.

CHAPTER 22 — DISCHARGE

Application for suspension of discharge

6.215

(1) The following applies where the official receiver applies to the court for an order under section 279(3) (suspension of automatic discharge), but not where he makes that application, pursuant to Rule 6.176(4), on the adjournment of the bankrupt's public examination.

(2) The official receiver shall with his application file a report 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, the trustee and the bankrupt.

(4) Copies of the official receiver's report under this Rule shall be sent by him to the trustee and the bankrupt, so as to reach them at least 21 days before the date fixed for the hearing.

(5) The bankrupt may, not later than 7 days before the date of the hearing, file in court a notice specifying any statements in the official receiver's report which he intends to deny or dispute.

If he gives notice under this paragraph, he shall send copies of it, not less than 4 days before the date of the hearing, to the official receiver and the trustee.

(6) If on the hearing the court makes an order suspending the bankrupt's discharge, copies of the order shall be sent by the court to the official receiver, the trustee and the bankrupt.

Lifting of suspension of discharge

6.216

(1) Where the court has made an order under section 279(3) that the relevant period (that is to say, the period after which the bankrupt may under that section have his discharge) 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 date fixed for hearing, give notice of the venue to the official receiver and the trustee, 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 he appears, the official receiver may file in court a report of any matters which he considers ought to be drawn to the court's attention.

(4) If the court's order under section 279(3) was for the relevant period to cease to run until the fulfilment of specified conditions, the court may request a report from the official receiver as to whether those conditions 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 to the bankrupt and the trustee, not later than 14 days before the hearing.

(6) The bankrupt may, not later than 7 days before the date of the hearing, file in court a notice specifying any statements in the official receiver's report which he intends to deny or dispute.

If he gives notice under this paragraph, he shall send copies of it, not less than 4 days before the date of the hearing, to the official receiver and the trustee.

(7) If on the bankrupt's application the court discharges the order under section 279(3) (being satisfied that the relevant period should begin to run again), it shall issue to the bankrupt a certificate that it has done so, with effect from a specified date.

Application by bankrupt for discharge

6.217

(1) If the bankrupt applies under section 280 for an order discharging him from bankruptcy, he shall give to the official receiver notice of the application, and deposit with him such sum as the latter may require to cover his costs of the application.

(2) The court, if satisfied that paragraph (1) has been complied with, shall fix a venue for the hearing of the application, and give at least 42 days' notice of it to the official receiver and the bankrupt.

(3) The official receiver shall give notice accordingly—

(a) to the trustee, and

(b) to every creditor who, to the official receiver's knowledge, has a claim outstanding against the estate which has not been satisfied.

(4) Notices under paragraph (3) shall be given not later than 14 days before the date fixed for the hearing of the bankrupt's application.

Report of official receiver

6.218

(1) Where the bankrupt makes an application under section 280, the official receiver shall, at least 21 days before the date fixed for the hearing of the application, file in court a report containing the following information with respect to the bankrupt—

(a) any failure by him to comply with his obligations under Parts VIII to XI of the Act;

(b) the circumstances surrounding the present bankruptcy, and those surrounding any previous bankruptcy of his;

(d) particulars of any distribution which has been, or is expected to be, made to creditors in the present bankruptcy or, if such is the case, that there has been and is to be no distribution;

and the official receiver shall include in his report any other matters which in his opinion ought to be brought to the court's attention.

(2) The official receiver shall send a copy of the report to the bankrupt and the trustee, so as to reach them at least 14 days before the date of the hearing of the application under section 280.

(3) The bankrupt may, not later than 7 days before the date of the hearing, file in court a notice specifying any statements in the official receiver's report which he intends to deny or dispute.

If he gives notice under this paragraph, he shall send copies of it, not less than 4 days before the date of the hearing, to the official receiver and the trustee.

(4) The official receiver, the trustee and any creditor may appear on the hearing of the bankrupt's application, and may make representations and put to the bankrupt such questions as the court may allow.

Order of discharge on application

6.219

(1) An order of the court under section 280(2)(b)(discharge absolutely) or (c) (discharge subject to conditions with respect to income or property) shall bear the date on which it is made, but does not take effect until such time as it is drawn up by the court.

(2) The order then has effect retrospectively to the date on which it was made.

(3) Copies of any order made by the court on an application by the bankrupt for discharge under section 280 shall be sent by the court to the bankrupt, the trustee and the official receiver.

Certificate of discharge

6.220

(1) Where it appears to the court that a bankrupt is discharged, whether by expiration of time or otherwise, the court shall, on his application, issue to him a certificate of his discharge, and the date from which it is effective.

(2) The discharged bankrupt may require the Secretary of State to give notice of the discharge—

(a) in the Gazette, or

(b) in any newspaper in which the bankruptcy was advertised, or

(3) Any requirement by the former bankrupt under paragraph (2) shall be addressed to the Secretary of State in writing. The Secretary of State shall notify him forthwith as to the cost of the advertisement, and is under no obligation to advertise until that sum has been paid.

(4) Where the former bankrupt has died, or is a person incapable of managing his affairs (within the meaning of Chapter 7 in Part 7 of the Rules), the references to him in paragraphs (2) and (3) are to be read as referring to his personal representative or, as the case may be, a person appointed by the court to represent or act for him.

Deferment of issue of order pending appeal

6.221

An order made by the court on an application by the bankrupt for discharge under section 280 shall not be issued or gazetted until the time allowed for appealing has expired or, if an appeal is entered, until the appeal has been determined.

Costs under this Chapter

6.222

In no case do any costs or expenses arising under this Chapter fall on the official receiver personally.

Bankrupt's debts surviving discharge

6.223

Discharge does not release the bankrupt from any obligation arising under a confiscation order made under section 1 of the Drug Trafficking Offences Act 1986 or section 1 of the Criminal Justice (Scotland) Act 1987.

CHAPTER 23 — ORDER OF PAYMENT OF COSTS, ETC., OUT OF ESTATE

General rule as to priority

6.224

(1) The expenses of the bankruptcy are payable out of the estate in the following order of priority—

(a) expenses properly chargeable or incurred by the official receiver or the trustee in preserving, realising or getting in any of the assets of the bankrupt, including those incurred in acquiring title to after-acquired property;

(b) any other expenses incurred or disbursements made by the official receiver or under his authority, including those incurred or made in carrying on the business of a debtor or bankrupt;

(i) the fee payable under any order made under section 415 for the performance by the official receiver of his general duties as official receiver;

(ii) any repayable deposit lodged by the petitioner under any such order as security for the fee mentioned in sub-paragraph (i) (except where the deposit is applied to the payment of the remuneration of an insolvency practitioner appointed under section 273 (debtor's petition));

(d) any other fees payable under any order made under section 415, including those payable to the official receiver, and any remuneration payable to him under general regulations;

(e) the cost of any security provided by an interim receiver, trustee or special manager in accordance with the Act or the Rules;

(f) the remuneration of the interim receiver (if any);

(g) any deposit lodged on an application for the appointment of an interim receiver;

(h) the costs of the petitioner, and of any person appearing on the petition whose costs are allowed by the court;

(j) the remuneration of the special manager (if any);

(k) any amount payable to a person employed or authorised, under Chapter 5 of this Part of the Rules, to assist in the preparation of a statement of affairs or of accounts;

(l) any allowance made, by order of the court, towards costs on an application for release from the obligation to submit a statement of affairs, or for an extension of time for submitting such a statement;

(m) any necessary disbursements by the trustee in the course of his administration (including any expenses incurred by members of the creditors' committee or their representatives and allowed by the trustee under Rule 6.164, but not including any payment of capital gains tax in circumstances referred to in sub-paragraph (p) below);

(n) the remuneration or emoluments of any person (including the bankrupt) who has been employed by the trustee to perform any services for the estate, as required or authorised by or under the Act or the Rules;

(o) the remuneration of the trustee, up to any amount not exceeding that which is payable to the official receiver under general regulations;

(p) the amount of any capital gains tax on chargeable gains accruing on the realisation of any asset of the bankrupt (without regard to whether the realisation is effected by the trustee, a secured creditor, or a receiver or manager appointed to deal with a security);

(q) the balance, after payment of any sums due under sub-paragraph (o) above, of any remuneration due to the trustee.

(2) The costs of employing a shorthand writer, if appointed by an order of the court made at the instance of the official receiver in connection with an examination, rank in priority with those specified in paragraph (1)(a). The costs of employing a shorthand writer so appointed in any other case rank after the allowance mentioned in paragraph (1)(l) and before the disbursements mentioned in paragraph (1)(m).

(3) Any expenses incurred in holding an examination under Rule 6.174 (examinee unfit), where the application for it is made by the official receiver, rank in priority with those specified in paragraph (1)(a).

CHAPTER 24 — SECOND BANKRUPTCY

Scope of this Chapter

6.225

(1) The Rules in this Chapter relate to the manner in which, in the case of a second bankruptcy, the trustee in the earlier bankruptcy is to deal with property and money to which section 334(3) applies, until there is a trustee of the estate in the later bankruptcy.

(2) “The earlier bankruptcy”, “the later bankruptcy” and “the existing trustee” have the meanings given by section 334(1).

General duty of existing trustee

6.226

(1) Subject as follows, the existing trustee shall take into his custody or under his control all such property and money, in so far as he has not already done so as part of his duties as trustee in the earlier bankruptcy.

(2) Where any of that property consists of perishable goods, or goods the value of which is likely to diminish if they are not disposed of, the existing trustee has power to sell or otherwise dispose of those goods.

(3) The proceeds of any such sale or disposal shall be held, under the existing trustee's control, with the other property and money comprised in the bankrupt's estate.

Delivery up to later trustee

6.227

The existing trustee shall, as and when requested by the trustee for the purposes of the later bankruptcy, deliver up to the latter all such property and money as is in his custody or under his control in pursuance of Rule 6.226.

Existing trustee's expenses

6.228

Any expenses incurred by the existing trustee in compliance with section 335(1) and this Chapter of the Rules shall be defrayed out of, and are a charge on, all such property and money as is referred to in section 334(3), whether in the hands of the existing trustee or of the trustee for the purposes of the later bankruptcy.

CHAPTER 25 — CRIMINAL BANKRUPTCY

Presentation of petition

6.229

(1) In criminal bankruptcy, the petition under section 264(1)(d) shall be presented to the High Court, and accordingly Rule 6.9 in Chapter 2 (court in which other petitions to be presented) does not apply.

(2) This does not affect the High Court's power to order that the proceedings be transferred.

Status and functions of Official Petitioner

6.230

(1) Subject as follows, the Official Petitioner is to be regarded for all purposes of the Act and the Rules as a creditor of the bankrupt.

(2) He may attend or be represented at any meeting of creditors, and is to be given any notice under the Act or the Rules which is required or authorised to be given to creditors; and the requirements of the Rules as to the lodging or use of proxies do not apply.

Interim receivership

6.231

Chapter 4 of this Part of the Rules applies in criminal bankruptcy only in so far as it provides for the appointment of the official receiver as interim receiver.

Proof of bankruptcy debts and notice of order

6.232

(1) The making of a bankruptcy order on a criminal bankruptcy petition does not affect the right of creditors to prove for their debts arising otherwise than in consequence of the criminal proceedings.

(2) A person specified in a criminal bankruptcy order as having suffered loss or damage shall be treated as a creditor of the bankrupt; and a copy of the order is sufficient evidence of his claim, subject to its being shown by any party to the bankruptcy proceedings that the loss or damage actually suffered was more or (as the case may be) less than the amount specified in the order.

(3) The requirements of the Rules with respect to the proof of debts do not apply to the Official Petitioner.

(4) In criminal bankruptcy, forms of proof shall be sent out by the official receiver within 12 weeks from the making of the bankruptcy order, to every creditor who is known to him, or is identified in the bankrupt’s statement of affairs.

(5) The official receiver shall, within those 12 weeks, send to every such creditor notice of the making of the bankruptcy order.

Meetings under the Rules

6.233

(1) The following Rules in Chapter 6 of this Part do not apply in criminal bankruptcy—

Rules 6.79 and 6.80 (first meeting of creditors, and business thereat);

Rule 6.82(2) (the chairman, if other than the official receiver);

Rule 6.88(2) and (3) (resolution for appointment of trustee).

(2) Rule 6.97 (supply of forms for proof of debts) does not apply.

Trustee in bankruptcy; creditors' committee; annulment of bankruptcy order

6.234

(1) Chapter 10 of this Part of the Rules does not apply in criminal bankruptcy, except Rules 6.136 (release of official receiver) and 6.147 (power of court to set aside transactions).

(2) Chapter 11 (creditors' committee) does not apply.

(3) Chapter 21 (annulment of bankruptcy order) applies to an application to the court under section 282(2) as it applies to an application under section 282(1), with any necessary modifications.

CHAPTER 26 — MISCELLANEOUS RULES IN BANKRUPTCY

Bankruptcy of solicitors

6.235

Where a bankruptcy order is made against a solicitor, or such an order made against a solicitor is rescinded or annulled, the court shall forthwith give notice to the Secretary of the Law Society of the order that it has made.

Consolidation of petitions

6.236

Where two or more bankruptcy petitions are presented against the same debtor, the court may order the consolidation of the proceedings, on such terms as it thinks fit.

Bankrupt's dwelling-house and home

6.237

(1) This Rule applies where the trustee applies to the court under section 313 for an order imposing a charge on property consisting of an interest in a dwelling-house.

(2) The bankrupt's spouse or former spouse shall be made respondent to the application; and the court may, if it thinks fit, direct other persons to be made respondents also, in respect of any interest which they may have in the property.

(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; and

(b) the amount which, at the date of the application, remains owing to unsecured creditors of the bankrupt.

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