The Insolvent Partnerships Order 1994

(95) The court may replace an administrator on the application of a person listed in paragraph 91(1) if the court— (a) is satisfied that a person who is entitled to replace the administrator under any of paragraphs 92 and 93 is not taking reasonable steps to make a replacement, or (b) that for another reason it is right for the court to make the replacement.

36

Paragraph 96 is modified so as to read as follows—

(96) (1) This paragraph applies where an administrator of a partnership is appointed under paragraph 14 by the holder of a qualifying agricultural floating charge in respect of the partnership property. (2) The holder of a prior qualifying agricultural floating charge in respect of the partnership property may apply to the court for the administrator to be replaced by an administrator nominated by the holder of the prior agricultural floating charge. (3) One agricultural floating charge is prior to another for the purposes of this paragraph if— (a) it was created first, or (b) it is to be treated as having priority in accordance with an agreement to which the holder of each agricultural floating charge was party.

37

Paragraph 97 is modified so as to read as follows—

(97) (1) This paragraph applies where— (a) an administrator of a partnership is appointed by the members of the partnership under paragraph 22, and (b) there is no holder of a qualifying agricultural floating charge in respect of the partnership property. (2) A creditor’s meeting may replace the administrator. (3) A creditors' meeting may act under sub-paragraph (2) only if the new administrator’s written consent to act is presented to the meeting before the replacement is made.

38

Paragraph 103 is modified so as to read as follows—

(103) (1) Where a partnership is in administration, a person may be appointed to act as administrator jointly or concurrently with the person or persons acting as the administrator of the partnership. (2) Where a partnership entered administration by administration order, an appointment under sub-paragraph (1) must be made by the court on the application of— (a) a person or group listed in paragraph 12(1)(a) to (c), or (b) the person or persons acting as the administrator of the partnership. (3) Where a partnership entered administration by virtue of an appointment under paragraph 14, an appointment under sub-paragraph (1) must be made by— (a) the holder of the agricultural floating charge by virtue of which the appointment was made, or (b) the court on the application of the person or persons acting as the administrator of the partnership. (4) Where a partnership entered administration by virtue of an appointment under paragraph 22, an appointment under sub-paragraph (1) above must be made either by the court on the application of the person or persons acting as the administrator of the partnership or— (a) by the members of the partnership, and (b) with the consent of each person who is the holder of a qualifying agricultural floating charge in respect of the partnership property or, where consent is withheld, with the permission of the court. (5) An appointment under sub-paragraph (1) may be made only with the consent of the person or persons acting as the administrator of the partnership.

39

Omit paragraph 105.

40

Paragraph 106 is modified so as to read as follows—

(106) (1) A person who is guilty of an offence under this Schedule is liable to a fine (in accordance with section 430 and Schedule 10). (2) A person who is guilty of an offence under any of the following paragraphs of this Schedule is liable to a daily default fine (in accordance with section 430 and Schedule 10)— (a) paragraph 20, (b) paragraph 32, (c) paragraph 46, (d) paragraph 48, (e) paragraph 49, (f) paragraph 51, (g) paragraph 53, (h) paragraph 54, (i) paragraph 56, (j) paragraph 78, (k) paragraph 80, (l) paragraph 84, and (m) paragraph 89.

41

Paragraph 111 is modified so as to read as follows—

(111) (1) In this Schedule— - “administrator” has the meaning given by paragraph 1 and, where the context requires, includes a reference to a former administrator, - “agricultural floating charge” means a charge which is an agricultural floating charge on its creation, - “correspondence” includes correspondence by telephonic or other electronic means, - “creditors' meeting” has the meaning given by paragraph 50, - “enters administration” has the meaning given by paragraph 1, - “in administration” has the meaning given by paragraph 1, - “hire-purchase agreement” includes a conditional sale agreement, a chattel leasing agreement and a retention of title agreement, - “holder of a qualifying agricultural floating charge” in respect of partnership property has the meaning given by paragraph 14, - “market value” means the amount which would be realised on a sale of property in the open market by a willing vendor, - “the purpose of administration” means an objective specified in paragraph 3, and - “unable to pay its debts” has the meaning given by sections 222, 223, and 224. (2) A reference in this Schedule to a thing in writing includes a reference to a thing in electronic form. (3) In this Schedule a reference to action includes a reference to inaction.

42

Omit paragraphs 112–116.

43

Schedule 1 is modified to read as follows:—

SCHEDULE 1 (1) Power to take possession of, collect and get in the partnership property and, for that purpose, to take such proceedings as may seem to him expedient. (2) Power to sell or otherwise dispose of the partnership property by public auction or private auction or private contract or, in Scotland, to sell, feu, hire out or otherwise dispose of the partnership property by public roup or private bargain. (3) Power to raise or borrow money and grant security therefor over the partnership property. (4) Power to appoint a solicitor or accountant or other professionally qualified person to assist him in the performance of his functions. (5) Power to bring or defend any action or other legal proceedings in the name and on behalf of any member of the partnership in his capacity as such or of the partnership. (6) Power to refer to arbitration any question affecting the partnership. (7) Power to effect and maintain insurances in respect of the partnership business and property. (8) Power to do all acts and execute, in the name and on behalf of the partnership or of any member of the partnership in his capacity as such, any deed, receipt or other document. (9) Power to draw, accept, make and endorse any bill of exchange or promissory note in the name and on behalf of any member of the partnership in his capacity as such or of the partnership. (10) Power to appoint any agent to do any business which he is unable to do himself or which can more conveniently be done by an agent and power to employ and dismiss employees. (11) Power to do all such things (including the carrying out of works) as may be necessary for the realisation of the partnership property. (12) Power to make any payment which is necessary or incidental to the performance of his functions. (13) Power to carry on the business of the partnership. (14) Power to establish subsidiary undertakings of the partnership. (15) Power to transfer to subsidiary undertakings of the partnership the whole or any part of the business of the partnership or of the partnership property. (16) Power to grant or accept a surrender of a lease or tenancy of any of the partnership property, and to take a lease or tenancy of any property required or convenient for the business of the partnership. (17) Power to make any arrangement or compromise on behalf of the partnership or of its members in their capacity as such. (18) Power to rank and claim in the bankruptcy, insolvency, sequestration or liquidation of any person indebted to the partnership and to receive dividends, and to accede to trust deeds for the creditors of any such person. (19) Power to present or defend a petition for the winding up of the partnership under the Insolvent Partnerships Order 1994. (20) Power to do all other things incidental to the exercise of the foregoing powers.

SCHEDULE 3 — PROVISIONS OF THE ACT WHICH APPLY WITH MODIFICATIONS FOR THE PURPOSES OF ARTICLE 7 TO WINDING UP OF INSOLVENT PARTNERSHIP ON PETITION OF CREDITOR ETC. WHERE NO CONCURRENT PETITION PRESENTED AGAINST MEMBER

PART I — MODIFIED PROVISIONS OF PART V OF THE ACT

1

Sections 220 to 223 of the Act are set out as modified in Part I of this Schedule, and sections 117, 131, 133, 234 and Schedule 4 are set out as modified in Part II.

Section 220: Meaning of “unregistered company”

2

Section 220 is modified so as to read as follows:—

(220) For the purposes of this Part, the expression “unregistered company” includes any insolvent partnership.

Section 221: Winding up of unregistered companies

3

Section 221 is modified so as to read as follows:—

(221) (1) Subject to subsections (2) and (3) below and to the provisions of this Part, any insolvent partnership may be wound up under this Act if it has, or at any time had, in England and Wales either— (a) a principal place of business, or (b) a place of business at which business is or has been carried on in the course of which the debt (or part of the debt) arose which forms the basis of the petition for winding up the partnership. (2) Subject to subsection (3) below, an insolvent partnership shall not be wound up under this Act if the business of the partnership has not been carried on in England and Wales at any time in the period of 3 years ending with the day on which the winding-up petition is presented. (3) If an insolvent partnership has a principal place of business situated in Scotland or in Northern Ireland, the court shall not have jurisdiction to wind up the partnership unless it had a principal place of business in England and Wales— (a) in the case of a partnership with a principal place of business in Scotland, at any time in the period of 1 year, or (b) in the case of a partnership with a principal place of business in Northern Ireland, at any time in the period of 3 years, ending with the day on which the winding-up petition is presented. (3A) The preceding subsections are subject to Article 3 of the EC Regulation (jurisdiction under the EC Regulation). (4) No insolvent partnership shall be wound up under this Act voluntarily. (5) To the extent that they are applicable to the winding up of a company by the court in England and Wales on the petition of a creditor or of the Secretary of State, all the provisions of this Act and the Companies Act about winding up apply to the winding up of an insolvent partnership as an unregistered company— (a) with the exceptions and additions mentioned in the following subsections of this section and in section 221A, and (b) with the modifications specified in Part II of Schedule 3 to the Insolvent Partnerships Order 1994. (6) Sections 73(1), 74(2)(a) to (d) and (3), 75 to 78, 83, 122, 123, 176A, 202, 203, 205 and 250 shall not apply. (7) The circumstances in which an insolvent partnership may be wound up as an unregistered company are as follows— (a) if the partnership is dissolved, or has ceased to carry on business, or is carrying on business only for the purpose of winding up its affairs; (b) if the partnership is unable to pay its debts; (c) if the court is of the opinion that it is just and equitable that the partnership should be wound up. (d) at the time at which a moratorium for the insolvent partnership under section 1A comes to an end, no voluntary arrangement approved under Part I of this Act has effect in relation to the insolvent partnership. (7A) A winding-up petition on the ground set out in section 221(7)(d) may only be presented by one or more creditors. (8) Every petition for the winding up of an insolvent partnership under Part V of this Act shall be verified by affidavit in Form 2 in Schedule 9 to the Insolvent Partnerships Order 1994. (221A) (1) A petition in Form 3 in Schedule 9 to the Insolvent Partnerships Order 1994 for winding up an insolvent partnership may be presented by— (a) the liquidator or administrator of a corporate member or of a former corporate member, or (b) the administrator of the partnership, or (c) the trustee of an individual member's, or of a former individual member's, estate, or (d) the supervisor of a voluntary arrangement approved under Part I of this Act in relation to a corporate member or the partnership, or under Part VIII of this Act in relation to an individual member, if the ground of the petition is one of the circumstances set out in section 221(7). (2) In this section “petitioning insolvency practitioner” means a person who has presented a petition under subsection (1). (3) If the ground of the petition presented under subsection (1) is that the partnership is unable to pay its debts and the petitioning insolvency practitioner is able to satisfy the court that an insolvency order has been made against the member whose liquidator or trustee he is because of that member’s inability to pay a joint debt, that order shall, unless it is proved otherwise to the satisfaction of the court, be proof for the purposes of section 221(7) that the partnership is unable to pay its debts. (4) Where a winding-up petition is presented under subsection (1), the court may appoint the petitioning insolvency practitioner as provisional liquidator of the partnership under section 135 (appointment and powers of provisional liquidator). (5) Where a winding-up order is made against an insolvent partnership after the presentation of a petition under subsection (1), the court may appoint the petitioning insolvency practitioner as liquidator of the partnership; and where the court makes an appointment under this subsection, section 140(3) (official receiver not to become liquidator) applies as if an appointment had been made under that section. (6) Where a winding-up petition is presented under subsection (1), in the event of the partnership property being insufficient to satisfy the costs of the petitioning insolvency practitioner the costs may be paid out of the assets of the corporate or individual member, as the case may be, as part of the expenses of the liquidation, administration, bankruptcy or voluntary arrangement of that member, in the same order of priority as expenses properly chargeable or incurred by the practitioner in getting in any of the assets of the member.

Section 222: Inability to pay debts: unpaid creditor for £750 or more

4

Section 222 is modified so as to read as follows:—

(222) (1) An insolvent partnership is deemed (for the purposes of section 221) unable to pay its debts if there is a creditor, by assignment or otherwise, to whom the partnership is indebted in a sum exceeding £750 then due and— (a) the creditor has served on the partnership, in the manner specified in subsection (2) below, a written demand in the prescribed form requiring the partnership to pay the sum so due, and (b) the partnership has for 3 weeks after the service of the demand neglected to pay the sum or to secure or compound for it to the creditor’s satisfaction. (2) Service of the demand referred to in subsection (1)(a) shall be effected— (a) by leaving it at a principal place of business of the partnership in England and Wales, or (b) by leaving it at a place of business of the partnership in England and Wales at which business is carried on in the course of which the debt (or part of the debt) referred to in subsection (1) arose, or (c) by delivering it to an officer of the partnership, or (d) by otherwise serving it in such manner as the court may approve or direct. (3) The money sum for the time being specified in subsection (1) is subject to increase or reduction by regulations under section 417 in Part XV; but no increase in the sum so specified affects any case in which the winding-up petition was presented before the coming into force of the increase.

Section 223: Inability to pay debts: debt remaining unsatisfied after action brought

5

Section 223 is modified so as to read as follows:—

(223) (1) An insolvent partnership is deemed (for the purposes of section 221) unable to pay its debts if an action or other proceeding has been instituted against any member for any debt or demand due, or claimed to be due, from the partnership, or from him in his character of member, and— (a) notice in writing of the institution of the action or proceeding has been served on the partnership in the manner specified in subsection (2) below, and (b) the partnership has not within 3 weeks after service of the notice paid, secured or compounded for the debt or demand, or procured the action or proceeding to be stayed or sisted, or indemnified the defendant or defender to his reasonable satisfaction against the action or proceeding, and against all costs, damages and expenses to be incurred by him because of it. (2) Service of the notice referred to in subsection (1)(a) shall be effected— (a) by leaving it at a principal place of business of the partnership in England and Wales, or (b) by leaving it at a place of business of the partnership in England and Wales at which business is carried on in the course of which the debt or demand (or part of the debt or demand) referred to in subsection (1) arose, or (c) by delivering it to an officer of the partnership, or (d) by otherwise serving it in such manner as the court may approve or direct.

PART II — OTHER MODIFIED PROVISIONS OF THE ACT ABOUT WINDING UP BY THE COURT

Section 117: High Court and county court jurisdiction

6

Section 117 is modified so as to read as follows:—

(117) (1) Subject to subsections (3) and (4) below, the High Court has jurisdiction to wind up any insolvent partnership as an unregistered company by virtue of article 7 of the Insolvent Partnerships Order 1994 if the partnership has, or at any time had, in England and Wales either— (a) a principal place of business, or (b) a place of business at which business is or has been carried on in the course of which the debt (or part of the debt) arose which forms the basis of the petition for winding up the partnership. (2) Subject to subsections (3) and (4) below, a petition for the winding up of an insolvent partnership by virtue of the said article 7 may be presented to a county court in England and Wales if the partnership has, or at any time had, within the insolvency district of that court either— (a) a principal place of business, or (b) a place of business at which business is or has been carried on in the course of which the debt (or part of the debt) arose which forms the basis of the winding-up petition. (3) Subject to subsection (4) below, the court only has jurisdiction to wind up an insolvent partnership if the business of the partnership has been carried on in England and Wales at any time in the period of 3 years ending with the day on which the petition for winding it up is presented. (4) If an insolvent partnership has a principal place of business situated in Scotland or in Northern Ireland, the court shall not have jurisdiction to wind up the partnership unless it had a principal place of business in England and Wales— (a) in the case of a partnership with a principal place of business in Scotland, at any time in the period of 1 year, or (b) in the case of a partnership with a principal place of business in Northern Ireland, at any time in the period of 3 years, ending with the day on which the petition for winding it up is presented. (5) The Lord Chancellor may, with the concurrence of the Lord Chief Justice, by order in a statutory instrument exclude a county court from having winding-up jurisdiction, and for the purposes of that jurisdiction may attach its district, or any part thereof, to any other county court, and may by statutory instrument revoke or vary any such order. In exercising the powers of this section, the Lord Chancellor shall provide that a county court is not to have winding-up jurisdiction unless it has for the time being jurisdiction for the purposes of Parts VIII to XI of this Act (individual insolvency). (6) Every court in England and Wales having winding-up jurisdiction has for the purposes of that jurisdiction all the powers of the High Court; and every prescribed officer of the court shall perform any duties which an officer of the High Court may discharge by order of a judge of that court or otherwise in relation to winding up. (7) This section is subject to Article 3 of the EC Regulation (jurisdiction under the EC Regulation). (8) The Lord Chief Justice may nominate a judicial office holder (as defined in section 109(4) of the Constitutional Reform Act 2005) to exercise his functions under this section.

Section 131: Statement of affairs of insolvent partnership

7

Section 131 is modified so as to read as follows:—

(131) (1) Where the court has, by virtue of article 7 of the Insolvent Partnerships Order 1994, made a winding-up order or appointed a provisional liquidator in respect of an insolvent partnership, the official receiver may require some or all of the persons mentioned in subsection (3) below to make out and submit to him a statement in the prescribed form as to the affairs of the partnership. (2) The statement shall be verified by affidavit by the persons required to submit it and shall show— (a) particulars of the debts and liabilities of the partnership and of the partnership property; (b) the names and addresses of the partnership’s creditors; (c) the securities held by them respectively; (d) the dates when the securities were respectively given; and (e) such further or other information as may be prescribed or as the official receiver may require. (3) The persons referred to in subsection (1) are— (a) those who are or have been officers of the partnership; (b) those who have taken part in the formation of the partnership at any time within one year before the relevant date; (c) those who are in the employment of the partnership, or have been in its employment within that year, and are in the official receiver’s opinion capable of giving the information required; (d) those who are or have been within that year officers of, or in the employment of, a company which is, or within that year was, an officer of the partnership. (4) Where any persons are required under this section to submit a statement of affairs to the official receiver, they shall do so (subject to the next subsection) before the end of the period of 21 days beginning with the day after that on which the prescribed notice of the requirement is given to them by the official receiver. (5) The official receiver, if he thinks fit, may— (a) at any time release a person from an obligation imposed on him under subsection (1) or (2) above; or (b) either when giving the notice mentioned in subsection (4) or subsequently, extend the period so mentioned; and where the official receiver has refused to exercise a power conferred by this subsection, the court, if it thinks fit, may exercise it. (6) In this section— - “employment” includes employment under a contract for services; and - “the relevant date” means—in a case where a provisional liquidator is appointed, the date of his appointment; andin a case where no such appointment is made, the date of the winding-up order. (7) If a person without reasonable excuse fails to comply with any obligation imposed under this section, he is liable to a fine and, for continued contravention, to a daily default fine.

Section 133: Public examination of officers of insolvent partnerships

8

Section 133 is modified so as to read as follows:—

(133) (1) Where an insolvent partnership is being wound up by virtue of article 7 of the Insolvent Partnerships Order 1994, the official receiver may at any time before the winding up is complete apply to the court for the public examination of any person who— (a) is or has been an officer of the partnership; or (b) has acted as liquidator or administrator of the partnership or as receiver or manager or, in Scotland, receiver of its property; or (c) not being a person falling within paragraph (a) or (b), is or has been concerned, or has taken part, in the formation of the partnership. (2) Unless the court otherwise orders, the official receiver shall make an application under subsection (1) if he is requested in accordance with the rules to do so by one-half, in value, of the creditors of the partnership. (3) On an application under subsection (1), the court shall direct that a public examination of the person to whom the application relates shall be held on a day appointed by the court; and that person shall attend on that day and be publicly examined as to the formation or management of the partnership or as to the conduct of its business and affairs, or his conduct or dealings in relation to the partnership. (4) The following may take part in the public examination of a person under this section and may question that person concerning the matters mentioned in subsection (3), namely— (a) the official receiver; (b) the liquidator of the partnership; (c) any person who has been appointed as special manager of the partnership’s property or business; (d) any creditor of the partnership who has tendered a proof in the winding up.

Section 234: Getting in the partnership property

9

Section 234 is modified so as to read as follows:—

(234) (1) This section applies where, by virtue of article 7 of the Insolvent Partnerships Order 1994— (a) an insolvent partnership is being wound up, or (b) a provisional liquidator of an insolvent partnership is appointed; and “the office-holder” means the liquidator or the provisional liquidator, as the case may be. (2) Any person who is or has been an officer of the partnership, or who is an executor or administrator of the estate of a deceased officer of the partnership, shall deliver up to the office-holder, for the purposes of the exercise of the office-holder’s functions under this Act and (where applicable) the Company Directors Disqualification Act 1986[^f00018], possession of any partnership property which he holds for the purposes of the partnership. (3) Where any person has in his possession or control any property, books, papers or records to which the partnership appears to be entitled, the court may require that person forthwith (or within such period as the court may direct) to pay, deliver, convey, surrender or transfer the property, books, papers or records to the office-holder or as the court may direct. (4) Where the office-holder— (a) seizes or disposes of any property which is not partnership property, and (b) at the time of seizure or disposal believes, and has reasonable grounds for believing, that he is entitled (whether in pursuance of an order of the court or otherwise) to seize or dispose of that property, the next subsection has effect. (5) In that case the office-holder— (a) is not liable to any person in respect of any loss or damage resulting from the seizure or disposal except in so far as that loss or damage is caused by the office-holder’s own negligence, and (b) has a lien on the property, or the proceeds of its sale, for such expenses as were incurred in connection with the seizure or disposal.

10

Schedule 4 is modified so as to read as follows:—

SCHEDULE 4 (1) Power to pay any class of creditors in full. (2) Power to make any compromise or arrangement with creditors or persons claiming to be creditors, or having or alleging themselves to have any claim (present or future, certain or contingent, ascertained or sounding only in damages) against the partnership, or whereby the partnership may be rendered liable. (3) Power to compromise, on such terms as may be agreed— (a) all debts and liabilities capable of resulting in debts, and all claims (present or future, certain or contingent, ascertained or sounding only in damages) subsisting or supposed to subsist between the partnership and a contributory or alleged contributory or other debtor or person apprehending liability to the partnership, and (b) all questions in any way relating to or affecting the partnership property or the winding up of the partnership, and take any security for the discharge of any such debt, liability or claim and give a complete discharge in respect of it. (3A) Power to bring legal proceedings under section 213, 214, 238, 239 or 423 (4) Power to bring or defend any action or other legal proceeding in the name and on behalf of any member of the partnership in his capacity as such or of the partnership. (5) Power to carry on the business of the partnership so far as may be necessary for its beneficial winding up. (6) Power to sell any of the partnership property by public auction or private contract, with power to transfer the whole of it to any person or to sell the same in parcels. (7) Power to do all acts and execute, in the name and on behalf of the partnership or of any member of the partnership in his capacity as such, all deeds, receipts and other documents. (8) Power to prove, rank and claim in the bankruptcy, insolvency or sequestration of any contributory for any balance againt his estate, and to receive dividends in the bankruptcy, insolvency or sequestration in respect of that balance, as a separate debt due from the bankrupt or insolvent, and rateably with the other separate creditors. (9) Power to draw, accept, make and endorse any bill of exchange or promissory note in the name and on behalf of any member of the partnership in his capacity as such or of the partnership, with the same effect with respect to the liability of the partnership or of ny member of the partnership in his capacity as such as if the bill or note had been drawn, accepted, made or endorsed in the course of the partnership’s business. (10) Power to raise on the security of the partnership property any money requisite. (11) Power to take out in his official name letters of administration to any deceased contributory, and to do in his official name any other act necessary for obtaining payment of any money due from a contributory or his estate which cannot conveniently be done in the name of the partnership. In all such cases the money due is deemed, for the purpose of enabling the liquidator to take out the letters of administration or recover the money, to be due to the liquidator himself. (12) Power to appoint an agent to do any business which the liquidator is unable to do himself. (13) Power to do all such other things as may be necessary for winding up the partnership’s affairs and distributing its property.

SCHEDULE 4 — PROVISIONS OF THE ACT WHICH APPLY WITH MODIFICATIONS FOR THE PURPOSES OF ARTICLE 8 TO WINDING UP OF INSOLVENT PARTNERSHIP ON CREDITOR'S PETITION WHERE CONCURRENT PETITIONS ARE PRESENTED AGAINST ONE OR MORE MEMBERS

PART I — MODIFIED PROVISIONS OF PART V OF THE ACT

1

• (1) Sections 220 to 222 of the Act are set out as modified in Part I of this Schedule, and the provisions of the Act specified in sub-paragraph (2) below are set out as modified in Part II.

• (2) The provisions referred to in sub-paragraph (1) are sections 117, 122 to 125, 131, 133, 136, 137, 139 to 141, 143, 146, 147, 168, 172, 174, 175, 189, 211, 230, 231, 234 264, 265, 267, 268, 271, 283, 283A, 284, 288, 292 to 296, 298 to 303, 305, 313A, 314, 328, 331 and 356, and Schedule 4.

Section 220: Meaning of “unregistered company”

2

Section 220 is modified so as to read as follows—

(220) For the purposes of this Part, the expression “unregistered company” includes any insolvent partnership.

Section 221: Winding up of unregistered companies

3

Section 221 is modified so as to read as follows—

(221) (1) Subject to subsections (2) and (3) below and to the provisions of this Part, any insolvent partnership may be wound up under this Act if it has, or at any time had, in England and Wales either— (a) a principal place of business, or (b) a place of business at which business is or has been carried on in the course of which the debt (or part of the debt) arose which forms the basis of the petition for winding up the partnership. (2) Subject to subsection (3) below, an insolvent partnership shall not be wound up under this Act if the business of the partnership has not been carried on in England and Wales at any time in the period of 3 years ending with the day on which the winding-up petition is presented. (3) If an insolvent partnership has a principal place of business situated in Scotland or in Northern Ireland, the court shall not have jurisdiction to wind up the partnership unless it had a principal place of business in England and Wales— (a) in the case of a partnership with a principal place of business in Scotland, at any time in the period of 1 year, or (b) in the case of a partnership with a principal place of business in Northern Ireland at any time in the period of 3 years, ending with the day on which the winding-up petition is presented. (3A) The preceding subsections are subject to Article 3 of the EC Regulation (jurisdiction under the EC Regulation). (4) No insolvent partnership shall be wound up under this Act voluntarily. (5) To the extent that they are applicable to the winding up of a company by the court in England and Wales on a creditor’s petition, all the provisions of this Act and the Companies Act about winding up apply to the winding up of an insolvent partnership as an unregistered company— (a) with the exceptions and additions mentioned in the following subsections of this section, and (b) with the modifications specified in Part II of Schedule 4 to the Insolvent Partnerships Order 1994. (6) Sections 73(1), 74(2)(a) to (d) and (3), 75 to 78, 83, 154, 176A, 202, 203, 205 and 250 shall not apply. (7) Unless the contrary intention appears, a member of a partnership against whom a insolvency order has been made by virtue of article 8 of the Insolvent Partnerships Order 1994 shall not be treated as a contributory for the purposes of this Act. (8) The circumstances in which an insolvent partnership may be wound up as an unregistered company are as follows— (a) the partnership is unable to pay its debts, (b) at the time at which a moratorium for the insolvent partnership under section 1A comes to an end, no voluntary arrangement approved under Part I of this Act has effect in relation to the insolvent partnership. (9) Every petition for the winding up of an insolvent partnership under Part V of this Act shall be verified by affidavit in Form 2 in Schedule 9 to the Insolvent Partnerships Order 1994.

Section 222: Inability to pay debts: unpaid creditor for £750 or more

4

Section 222 is modified so as to read as follows—

(222) (1) An insolvent partnership is deemed (for the purposes of section 221) unable to pay its debts if there is a creditor, by assignment or otherwise, to whom the partnership is indebted in a sum exceeding £750 then due and— (a) the creditor has served on the partnership, in the manner specified in subsection (2) below, a written demand in Form 4 in Schedule 9 to the Insolvent Partnerships Order 1994 requiring the partnership to pay the sum so due, (b) the creditor has also served on any one or more members or former members of the partnership liable to pay the sum due (in the case of a corporate member by leaving it at its registered office and in the case of an individual member by serving it in accordance with the rules) a demand in Form 4 in Schedule 9 to that Order, requiring that member or those members to pay the sum so due, and (c) the partnership and its members have for 3 weeks after the service of the demands, or the service of the last of them if served at different times, neglected to pay the sum or to secure or compound for it to the creditor’s satisfaction. (2) Service of the demand referred to in subsection (1)(a) shall be effected— (a) by leaving it at a principal place of business of the partnership in England and Wales, or (b) by leaving it at a place of business of the partnership in England and Wales at which business is carried on in the course of which the debt (or part of the debt) referred to in subsection (1) arose, or (c) by delivering it to an officer of the partnership, or (d) by otherwise serving it in such manner as the court may approve or direct. (3) The money sum for the time being specified in subsection (1) is subject to increase or reduction by regulations under section 417 in Part XV; but no increase in the sum so specified affects any case in which the winding-up petition was presented before the coming into force of the increase.

PART II — OTHER MODIFIED PROVISIONS OF THE ACT ABOUT WINDING UP BY THE COURT AND BANKRUPTCY OF INDIVIDUALS

Sections 117 and 265: High Court and county court jurisdiction

5

Sections 117 and 265 are modified so as to read as follows—

(117) (1) Subject to the provisions of this section, the High Court has jurisdiction to wind up any insolvent partnership as an unregistered company by virtue of article 8 of the Insolvent Partnerships Order 1994 if the partnership has, or at any time had, in England and Wales either— (a) a principal place of business, or (b) a place of business at which business is or has been carried on in the course of which the debt (or part of the debt) arose which forms the basis of the petition for winding up the partnership. (2) Subject to subsections (3) and (4) below, a petition for the winding up of an insolvent partnership by virtue of the said article 8 may be presented to a county court in England and Wales if the partnership has, or at any time had, within the insolvency district of that court either— (a) a principal place of business, or (b) a place of business at which business is or has been carried on in the course of which the debt (or part of the debt) arose which forms the basis of the winding-up petition (3) Subject to subsection (4) below, the court only has jurisdiction to wind up an insolvent partnership if the business of the partnership has been carried on in England and Wales at any time in the period of 3 years ending with the day on which the petition for winding it up is presented. (4) If an insolvent partnership has a principal place of business situated in Scotland or in Northern Ireland, the court shall not have jurisdiction to wind up the partnership unless it had a principal place of business in England and Wales— (a) in the case of a partnership with a principal place of business in Scotland, at any time in the period of 1 year, or (b) in the case of a partnership with a principal place of business in Northern Ireland at any time in the period of 3 years, ending with the day on which the petition for winding it up is presented. (5) Subject to subsection (6) below, the court has jurisdiction to wind up a corporate member or former corporate member, or make a bankruptcy order against an individual member or former individual member, of a partnership against which a petition has been presented by virtue of article 8 of the Insolvent Partnerships Order 1994 if it has jurisdiction in respect of the partnership. (6) Petitions by virtue of the said article 8 for the winding up of an insolvent partnership and the bankruptcy of one or more members or former members of that partnership may not be presented to a district registry of the High Court. (7) The Lord Chancellor may, with the concurrence of the Lord Chief Justice, by order in a statutory instrument exclude a county court from having winding-up jurisdiction, and for the purposes of that jurisdiction may attach its district, or any part thereof, to any other county court, and may by statutory instrument revoke or vary any such order. - In exercising the powers of this section, the Lord Chancellor shall provide that a county court is not to have winding-up jurisdiction unless it has for the time being jurisdiction for the purposes of Parts VIII to XI of this Act (individual insolvency). (8) Every court in England and Wales having winding-up jurisdiction has for the purposes of that jurisdiction all the powers of the High Court; and every prescribed officer of the court shall perform any duties which an officer of the High Court may discharge by order of a judge of that court or otherwise in relation to winding up. (9) This section is subject to Article 3 of the EC Regulation (jurisdiction under the EC Regulation) (10) The Lord Chief Justice may nominate a judicial office holder (as defined in section 109(4) of the Constitutional Reform Act 2005) to exercise his functions under this section

Circumstances in which members of insolvent partnerships may be wound up or made bankrupt by the court: Section 122 corporate member Section 267 individual member

6

• (a) Section 122 is modified so as to read as follows—

(122) A corporate member or former corporate member of an insolvent partnership may be wound up by the court if— (a) it is unable to pay its debts, (b) there is a creditor, by assignment or otherwise, to whom the insolvent partnership is indebted and the corporate member or former corporate member is liable in relation to that debt and at the time at which a moratorium for the insolvent partnership under section 1A comes to an end, no voluntary arrangement approved under Part I of this Act has effect in relation to the insolvent partnership.

• (b) Section 267 is modified so as to read as follows—

(267) (1) Where a petition for the winding up of an insolvent partnership has been presented to the court by virtue of article 8 of the Insolvent Partnerships Order 1994, a creditor’s petition against any individual member or former individual member of that partnership by virtue of that article must be in respect of one or more joint debts owed by the insolvent partnership, and the petitioning creditor or each of the petitioning creditors must be a person to whom the debt or (as the case may be) at least one of the debts is owed. (2) Subject to subsection (2A) below and section 268, a creditor’s petition may be presented to the court in respect of a joint debt or debts only if, at the time the petition is presented— (a) the amount of the debt, or the aggregate amount of the debts, is equal to or exceed the bankruptcy level, (b) the debt, or each of the debts, is for a liquidated sum payable to the petitioning creditor, or one or more of the petitioning creditors, immediately, and is unsecured, (c) the debt, or each of the debts, is a debt for which the individual member or former member is liable and which he appears to be unable to pay, and (d) there is no outstanding application to set aside a statutory demand served (under section 268 below) in respect of the debt or any of the debts. (2A) A creditor’s petition may be presented to the court in respect of a joint debt or debts if at the time at which a moratorium for the insolvent partnership under section 1A comes to an end, no voluntary arrangement approved under Part I of this Act has effect in relation to the insolvent partnership. (3) “The bankruptcy level” is £750; but the Secretary of State may by order in a statutory instrument substitute any amount specified in the order for that amount or (as th case may be) for the amount which by virtue of such an order is for the time being the mount of the bankruptcy level. (4) An order shall not be made under subsection (3) unless a draft of it has been laid before, and approved by a resolution of, each House of Parliament.

Definition of inability to pay debts: Section 123-corporate member Section 268 individual member

7

• (a) Section 123 is modified so as to read as follows—

(123) (1) A corporate member or former member is deemed unable to pay its debts if there is a creditor, by assignment or otherwise, to whom the partnership is indebted in a sum exceeding £750 then due for which the member or former member is liable and— (a) the creditor has served on that member or former member and the partnership, in the manner specified in subsection (2) below, a written demand in Form 4 in Schedule 9 to the Insolvent Partnerships Order 1994 requiring that member or former member and the partnership to pay the sum so due, and (b) the corporate member or former member and the partnership have for 3 weeks after the service of the demands, or the service of the last of them if served at different times neglected to pay the sum or to secure or compound for it to the creditor’s satisfaction (2) Service of the demand referred to in subsection (1)(a) shall be effected, in th case of the corporate member or former corporate member, by leaving it at its registere office, and, in the case of the partnership— (a) by leaving it at a principal place of business of the partnership in England and Wales, or (b) by leaving it at a place of business of the partnership in England and Wales at which business is carried on in the course of which the debt (or part of the debt) referred to in subsection (1) arose, or (c) by delivering it to an officer of the partnership, or (d) by otherwise serving it in such manner as the court may approve or direct. (3) The money sum for the time being specified in subsection (1) is subject to increase or reduction by order under section 416 in Part XV.

• (b) Section 268 is modified so as to read as follows—

(268) (1) For the purposes of section 267(2)(c), an individual member or former individual member appears to be unable to pay a joint debt for which he is liable if the debt is payable immediately and the petitioning creditor to whom the insolvent partnership owes the joint debt has served— (a) on the individual member or former individual member in accordance with the rules a demand (known as “the statutory demand”), in Form 4 in Schedule 9 to the Insolvent Partnerships Order 1994, and (b) on the partnership in the manner specified in subsection (2) below a demand (known as “the written demand”) in the same form, requiring the member or former member and the partnership to pay the debt or to secure or compound for it to the creditor’s satisfaction, and at least 3 weeks have elapsed since the service of the demands, or the service of the last of them if served at different times, and neither demand has been complied with nor the demand against the member set aside in accordance with the rules. (2) Service of the demand referred to in subsection (1)(b) shall be effected— (a) by leaving it at a principal place of business of the partnership in England and Wales, or (b) by leaving it at a place of business of the partnership in England and Wales at which business is carried on in the course of which the debt (or part of the debt) referred to in subsection (1) arose, or (c) by delivering it to an officer of the partnership, or (d) by otherwise serving it in such manner as the court may approve or direct.

Sections 124 and 264: Applications to wind up insolvent partnership and to wind up or bankrupt insolvent member

8

Sections 124 and 264 are modified so as to read as follows—

(124) (1) An application to the court by virtue of article 8 of the Insolvent Partnerships Order 1994 for the winding up of an insolvent partnership as an unregistered company and the winding up or bankruptcy (as the case may be) of at least one of its members or former members shall— (a) in the case of the partnership, be by petition in Form 5 in Schedule 9 to that Order, (b) in the case of a corporate member or former corporate member, be by petition in Form 6 in that Schedule, and (c) in the case of an individual member or former individual member, be by petition in Form 7 in that Schedule. (2) Each of the petitions mentioned in subsection (1) may be presented by a liquidator (within the meaning of Article 2(b) of the EC Regulation) appointed in proceedings by virtue of Article 3(1) of the EC Regulation, a temporary administrator (within the meaning of Article 38 of the EC Regulation) or any creditor or creditors to whom the partnership and the member or former member in question is indebted in respect of a liquidated sum payable immediately. (3) The petitions mentioned in subsection (1)— (a) shall all be presented to the same court and, except as the court otherwise permits or directs, on the same day, and (b) except in the case of the petition mentioned in subsection (1)(c), shall be advertised in Form 8 in the said Schedule 9. (4) At any time after presentation of a petition under this section the petitioner may, with the leave of the court obtained on application and on such terms as it thinks just, add other members or former members of the partnership as parties to the proceedings in relation to the insolvent partnership. (5) Each petition presented under this section shall contain particulars of other petitions being presented in relation to the partnership, identifying the partnership and members concerned. (6) The hearing of the petition against the partnership fixed by the court shall be in advance of the hearing of any petition against an insolvent member. (7) On the day appointed for the hearing of the petition against the partnership, the petitioner shall, before the commencement of the hearing, hand to the court Form 9 in Schedule 9 to the Insolvent Partnerships Order 1994, duly completed. (8) Any member of the partnership or any person against whom a winding-up or bankruptcy petition has been presented in relation to the insolvent partnership is entitled to appear and to be heard on any petition for the winding up of the partnership. (9) A petitioner under this section may at the hearing withdraw a petition if— (a) subject to subsection (10) below, he withdraws at the same time every other petitio which he has presented under this section; and (b) he gives notice to the court at least 3 days before the date appointed for the hearing of the relevant petition of his intention to withdraw the petition. (10) A petitioner need not comply with the provisions of subsection (9)(a) in the case of a petition against an insolvent member if the court is satisfied on application made to it by the petitioner that, because of difficulties in serving the petition or for any other reason, the continuance of that petition would be likely to prejudice or delay the proceedings on the petition which he has presented against the partnership or on any petition which he has presented against any other insolvent member. (11) Where notice is given under subsection (9)(b), the court may, on such terms as it thinks just, substitute as petitioner, both in respect of the partnership and in respect of each insolvent member against whom a petition has been presented, any creditor of the partnership who in its opinion would have a right to present the petitions, and if the court makes such a substitution the petitions in question will not be withdrawn. (12) Reference in subsection (11) to substitution of a petitioner includes reference to change of carriage of the petition in accordance with the rules.

Sections 125 and 271: Powers of court on hearing of petitions against insolvent partnership and members

9

Sections 125 and 271 are modified so as to read as follows—

(125) (1) Subject to the provisions of section 125A, on hearing a petition under section 124 against an insolvent partnership or any of its insolvent members, the court may dismiss it, or adjourn the hearing conditionally or unconditionally or make any other order that it thinks fit; but the court shall not refuse to make a winding-up order against the partnership or a corporate member on the ground only that the partnership property or (as the case may be) the member’s assets have been mortgaged to an amount equal to or in excess of that property or those assets, or that the partnership has no property or the member no assets. (2) An order under subsection (1) in respect of an insolvent partnership may contain directions as to the future conduct of any insolvency proceedings in existence against any insolvent member in respect of whom an insolvency order has been made. (125A) (1) On the hearing of a petition against an insolvent member the petitioner shall draw the court’s attention to the result of the hearing of the winding-up petition against the partnership and the following subsections of this section shall apply. (2) If the court has neither made a winding-up order, nor dismissed the winding-up petition, against the partnership the court may adjourn the hearing of the petition against the member until either event has occurred. (3) Subject to subsection (4) below, if a winding-up order has been made against the partnership, the court may make a winding-up order against the corporate member in respect of which, or (as the case may be) a bankruptcy order against the individual member in respect of whom, the insolvency petition was presented. (4) If no insolvency order is made under subsection (3) against any member within 2 days of the making of the winding-up order against the partnership, the proceedings against the partnership shall be conducted as if the winding-up petition against the partnership had been presented by virtue of article 7 of the Insolvent Partnerships Order 1994 and the proceedings against any member shall be conducted under this Act without the modifications made by that Order (other than the modifications made to sections 168 and 303 by article 14). (5) If the court has dismissed the winding-up petition against the partnership, the court may dismiss the winding-up petition against the corporate member or (as the case may be) the bankruptcy petition against the individual member.However, if an insolvency order is made against a member, the proceedings against that member shall be conducted under this Act without the modifications made by the Insolvent Partnerships Order 1994 (other than the modifications made to sections 168 and 303 of this Act by article 14 of that Order). (6) The court may dismiss a petition against an insolvent member if it considers it just to do so because of a change in circumstances since the making of the winding-up order against the partnership. (7) The court may dismiss a petition against an insolvent member who is a limited partner, if— (a) the member lodges in court for the benefit of the creditors of the partnership sufficient money or security to the court’s satisfaction to meet his liability for the debts and obligations of the partnership; or (b) the member satisfies the court that he is no longer under any liability in respect of the debts and obligations of the partnership. (8) Nothing in sections 125 and 125A or in sections 267 and 268 prejudices the power of the court, in accordance with the rules, to authorise a creditor’s petition to be amended by the omission of any creditor or debt and to be proceeded with as if things done for the purpses of those sections had been done only by or in relation to the remaining creditors or debts.

Sections 131 and 288: Statements of affairs Insolvent partnerships; corporate members; individual members

10

Sections 131 and 288 are modified so as to read as follows—

(131) (1) This section applies where the court has, by virtue of article 8 of the Insolvent Partnerships Order 1994— (a) made a winding-up order or appointed a provisional liquidator in respect of an insolvent partnership, or (b) made a winding-up order or appointed a provisional liquidator in respect of any corporate member of that partnership, or (c) made a bankruptcy order in respect of any individual member of that partnership. (2) The official receiver may require some or all of the persons mentioned in subsection (4) below to make out and submit to him a statement as to the affairs of the partnership or member in the prescribed form. (3) The statement shall be verified by affidavit by the persons required to submit it and shall show— (a) particulars of the debts and liabilities of the partnership or of the member (as the case may be), and of the partnership property and member’s assets; (b) the names and addresses of the creditors of the partnership or of the member (as the case may be); (c) the securities held by them respectively; (d) the dates when the securities were respectively given; and (e) such further or other information as may be prescribed or as the official receiver may require. (4) The persons referred to in subsection (2) are— (a) those who are or have been officers of the partnership; (b) those who are or have been officers of the corporate member; (c) those who have taken part in the formation of the partnership or of the corporate member at any time within one year before the relevant date; (d) those who are in the employment of the partnership or of the corporate member, or have been in such employment within that year, and are in the official receiver’s opinion capable of giving the information required; (e) those who are or have been within that year officers of, or in the employment of, a company which is, or within that year was, an officer of the partnership or an officer of the corporate member. (5) Where any persons are required under this section to submit a statement of affairs to the official receiver, they shall do so (subject to the next subsection) before the end of the period of 21 days beginning with the day after that on which the prescribed notice of the requirement is given to them by the official receiver. (6) The official receiver, if he thinks fit, may— (a) at any time release a person from an obligation imposed on him under subsection (2) or (3) above; or (b) either when giving the notice mentioned in subsection (5) or subsequently, extend the period so mentioned; and where the official receiver has refused to exercise a power conferred by this sub section, the court, if it thinks fit, may exercise it. (7) In this section “employment” includes employment under a contract for services; and “the relevant date” means— (a) in a case where a provisional liquidator is appointed, the date of his appointment; and (b) in a case where no such appointment is made, the date of the winding-up order. (8) Any person who without reasonable excuse fails to comply with any obligation imposed under this section (other than, in the case of an individual member, an obligation in respect of his own statement of affairs), is liable to a fine and, for continued contravention, to a daily default fine. (9) An individual member who without reasonable excuse fails to comply with any obligation imposed under this section in respect of his own statement of affairs, is guilty of a contempt of court and liable to be punished accordingly (in addition to any other punishment to which he may be subject).

Section 133: Public examination of officers of insolvent partnerships

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Section 133 is modified so far as insolvent partnerships are concerned so as to read as follows—

(133) (1) Where an insolvent partnership is being wound up by virtue of article 8 of the Insolvent Partnerships Order 1994, the official receiver may at any time before the winding up is complete apply to the court for the public examination of any person who— (a) is or has been an officer of the partnership; or (b) has acted as liquidator or administrator of the partnership or as receiver or manager or, in Scotland, receiver of its property; (c) not being a person falling within paragraph (a) or (b), is or has been concerned, or has taken part, in the formation of the partnership. (2) Unless the court otherwise orders, the official receiver shall make an application under subsection (1) if he is requested in accordance with the rules to do so by one-half, in value, of the creditors of the partnership. (3) On an application under subsection (1), the court shall direct that a public examination of the person to whom the application relates shall be held on a day appointed by the court; and that person shall attend on that day and be publicly examined as to the formation or management of the partnership or as to the conduct of its business and affairs, or his conduct or dealings in relation to the partnership. (4) The following may take part in the public examination of a person under this section and may question that person concerning the matters mentioned in subsection (3), namely— (a) the official receiver; (b) the liquidator of the partnership; (c) any person who has been appointed as special manager of the partnership’s property or business; (d) any creditor of the partnership who has tendered a proof in the winding up. (5) On an application under subsection (1), the court may direct that the public examination of any person under this section in relation to the affairs of an insolvent partnership be combined with the public examination of any person under this Act in relation to the affairs of a corporate member of that partnership against which, or an individual member of the partnership against whom, an insolvency order has been made.

Sections 136, 293 and 294: Functions of official receiver in relation to office of responsible insolvency practitioner

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Sections 136, 293 and 294 are modified so as to read as follows—

(136) (1) The following provisions of this section and of section 136A have effect, subject to section 140 below, where insolvency orders are made in respect of an insolvent partnership and one or more of its insolvent members by virtue of article 8 of the Insolvent Partnerships Order 1994. (2) The official receiver, by virtue of his office, becomes the responsible insolvency practitioner of the partnership and of any insolvent member and continues in office until another person becomes responsible insolvency practitioner under the provisions of this Part. (3) The official receiver is, by virtue of his office, the responsible insolvency practitioner of the partnership and of any insolvent member during any vacancy. (4) At any time when he is the responsible insolvency practitioner of the insolvent partnership and of any insolvent member, the official receiver may summon a combined meeting of the creditors of the partnership and the creditors of such member, for the purpose of choosing a person to be responsible insolvency practitioner in place of the official receiver. (136A) (1) It is the duty of the official receiver— (a) as soon as practicable in the period of 12 weeks beginning with the day on which the insolvency order was made against the partnership, to decide whether to exercise his power under section 136(4) to summon a meeting, and (b) if in pursuance of paragraph (a) he decides not to exercise that power, to give notice of his decision, before the end of that period, to the court and to the creditors of the partnership and the creditors of any insolvent member against whom an insolvency order has been made, and (c) (whether or not he has decided to exercise that power) to exercise his power to summon a meeting under section 136(4) if he is at any time requested to do so in accordance with the rules by one-quarter, in value, of either— (i) the partnership’s creditors, or (ii) the creditors of any insolvent member against whom an insolvency order has been made, and accordingly, where the duty imposed by paragraph (c) arises before the official receiver has performed a duty imposed by paragraph (a) or (b), he is not required to perform the latter duty. (2) A notice given under subsection (1)(b) to the creditors shall contain an explanation of the creditors' power under subsection (1)(c) to require the official receiver to summon a combined meeting of the creditors of the partnership and of any insolvent member. (3) If the official receiver, in pursuance of subsection (1)(a), has decided to exercise his power under section 136(4) to summon a meeting, he shall hold that meeting in the period of 4 months beginning with the day on which the insolvency order was made against the partnership. (4) If (whether or not he has decided to exercise that power) the official receiver is requested, in accordance with the provisions of subsection (1)(c), to exercise his power under section 136(4) to summon a meeting, he shall hold that meeting in accordance with the rules. (5) Where a meeting of creditors of the partnership and of any insolvent member has been held under section 136(4), and an insolvency order is subsequently made against a further insolvent member by virtue of article 8 of the Insolvent Partnerships Order 1994— (a) any person chosen at that meeting to be responsible insolvency practitioner in place of the official receiver shall also be the responsible insolvency practitioner of the member against whom the subsequent order is made, and (b) subsection (1) of this section shall not apply.

Sections 137, 295, 296 and 300: Appointment of responsible insolvency practitioner by Secretary of State

13

Sections 137, 295, 296 and 300 are modified so as to read as follows—

(137) (1) This section and the next apply where the court has made insolvency orders in respect of an insolvent partnership and one or more of its insolvent members by virtue of article 8 of the Insolvent Partnerships Order 1994. (2) The official receiver may, at any time when he is the responsible insolvency practitioner of the partnership and of any insolvent member, apply to the Secretary of State for the appointment of a person as responsible insolvency practitioner of both the partnership and of such member in his place. (3) If a meeting is held in pursuance of a decision under section 136A(1)(a), but no person is chosen to be responsible insolvency practitioner as a result of that meeting, it is the duty of the official receiver to decide whether to refer the need for an appointment to the Secretary of State. (137A) (1) On an application under section 137(2), or a reference made in pursuance of a decision under section 137(3), the Secretary of State shall either make an appointment to decline to make one. (2) If on an application under section 137(2), or a reference made in pursuance of a decision under section 137(3), no appointment is made, the official receiver shall continue to be responsible insolvency practitioner of the partnership and its insolvent member or members, but without prejudice to his power to make a further application or reference. (3) Where a responsible insolvency practitioner has been appointed by the Secretary of State under subsection (1) of this section, and an insolvency order is subsequently made against a further insolvent member by virtue of article 8 of the Insolvent Partnerships Order 1994, then the practitioner so appointed shall also be the responsible insolvency practitioner of the member against whom the subsequent order is made. (4) Where a responsible insolvency practitioner has been appointed by the Secretary of State under subsection (1), or has become responsible insolvency practitioner of a further insolvent member under subsection (3), that practitioner shall give notice of his appointment or further appointment (as the case may be) to the creditors of the insolvent partnership and the creditors of the insolvent member or members against whom insolvency orders have been made or, if the court so allows, shall advertise his appointment in accordance with the directions of the court. (5) Subject to subsection (6) below, in that notice or advertisement the responsible insolvency practitioner shall— (a) state whether he proposes to summon, under section 141 below, a combined meeting of the creditors of the insolvent partnership and of the insolvent member or members agains whom insolvency orders have been made, for the purpose of determining whether a creditors' committee should be established under that section, and (b) if he does not propose to summon such a meeting, set out the power under that section of the creditors of the partnership and of the insolvent member or members to require him to summon one. (6) Where in a case where subsection (3) applies a meeting has already been held under section 141 below, the responsible insolvency practitioner shall state in the notice or advertisement whether a creditors' committee was established at that meeting and— (a) if such a committee was established, shall state whether he proposes to appoint additional members of the committee under section 141A(3), and (b) if such a committee was not established, shall set out the power under section 141 of the creditors of the partnership and of the insolvent member or members to require him to summon a meeting for the purpose of determining whether a creditors' committee should be established under that section.

Section 139: Rules applicable to meetings of creditors

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Section 139 is modified so as to read as follows—

(139) (1) This section applies where the court has made insolvency orders against a insolvent partnership and one or more of its insolvent members by virtue of article 8 of the Insolvent Partnerships Order 1994. (2) Subject to subsection (4) below, the rules relating to the requisitioning, summoning, holding and conducting of meetings on the winding up of a company are to apply (with the necessary modifications) to the requisitioning, summoning, holding and conducting of— (a) separate meetings of the creditors of the partnership or of any corporate member against which an insolvency order has been made, and (b) combined meetings of the creditors of the partnership and the creditors of the insolvent member or members. (3) Subject to subsection (4) below, the rules relating to the requisitioning, summoning, holding and conducting of meetings on the bankruptcy of an individual are to apply (with the necessary modifications) to the requisitioning, summoning, holding and conducting of separate meetings of the creditors of any individual member against whom an insolvency order has been made. (4) Any combined meeting of creditors shall be conducted as if the creditors of the partnership and of the insolvent member or members were a single set of creditors.

Section 140: Appointment by the court following administration or voluntary arrangement

15

Section 140 is modified so as to read as follows—

(140) (1) This section applies where insolvency orders are made in respect of an insolvent partnership and one or more of its insolvent members by virtue of article 8 of the Insolvent Partnerships Order 1994. (2) Where the orders referred to in subsection (1) are made immediately upon the appointment of an administrator in respect of the partnership ceasing to have effect, the court may appoint a responsible insolvency practitioner the person whose appointment as administrator has ceased to have effect. (3) Where the orders referred to in subsection (1) are made at a time when there is a supervisor of a voluntary arrangement approved in relation to the partnership under Part I, the court may appoint as responsible insolvency practitioner the person who is the supervisor at the time when the winding-up order against the partnership is made. (4) Where the court makes an appointment under this section, the official receiver does not become the responsible insolvency practitioner as otherwise provided by section 36(2), and he has no duty under section 136A(1)(a) or (b) in respect of the summoning of creditors' meetings.

Sections 141, 301 and 302: Creditors' Committee: Insolvent partnership and members

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Sections 141, 301 and 302 are modified so as to read as follows—

(141) (1) This section applies where— (a) insolvency orders are made in respect of an insolvent partnership and one or more of its insolvent members by virtue of article 8 of the Insolvent Partnerships Order 1994, and (b) a combined meeting of creditors has been summoned for the purpose of choosing a person to be responsible insolvency practitioner of the partnership and of any such insolvent member or members. (2) The meeting of creditors may establish a committee (“the creditors' committee”) which shall consist of creditors of the partnership or creditors of any insolvent member against whom an insolvency order has been made, or both. (3) The responsible insolvency practitioner of the partnership and of its insolvent member or members (not being the official receiver) may at any time, if he thinks fit, summon a combined general meeting of the creditors of the partnership and of such member or members for the purpose of determining whether a creditors' committee should be established and, if it is so determined of establishing it. - The responsible insolvency practitioner (not being the official receiver) shall summon such a meeting if he is requested, in accordance with the rules, to do so by one-tenth, in value, of either—the partnership’s creditors, orthe creditors of any insolvent member against whom an insolvency order has been made. (141A) (1) The committee established under section 141 shall act as liquidation committee for the partnership and for any corporate member against which an insolvency order has been made, and as creditors' committee for any individual member against whom an insolvency order has been made, and shall as appropriate exercise the functions conferred on liquidation and creditors' committees in a winding up or bankruptcy by or under this Act. (2) The rules relating to liquidation committees are to apply (with the necessary modifications and with the exclusion of all references to contributories) to a committee established under section 141. (3) Where the appointment of the responsible insolvency practitioner also takes effect in relation to a further insolvent member under section 136A(5) or 137A(3), the practitioner may appoint any creditor of that member (being qualified under the rules to be a member of the committee) to be a additional member of any creditors' committee already established under section 141, provided that the creditor concerned consents to act. (4) The court may at any time, on application by a creditor of the partnership or of any insolvent member against whom an insolvency order has been made, appoint additional members of the creditors' committee. (5) If additional members of the creditors' committee are appointed under subsection (3) or (4), the limit on the maximum number of members of the committee specified in the rules shall be increased by the number of additional members so appointed. (6) The creditors' committee is not to be able or required to carry out its functions at any time when the official receiver is responsible insolvency practitioner of the partnership and of its insolvent member or members; but at any such time its functions are vested in the Secretary of State except to the extent that the rules otherwise provide. (7) Where there is for the time being no creditors' committee, and the responsible insolvency practitioner is a person other than the official receiver, the functions of such a committee are vested in the Secretary of State except to the extent that the rules otherwise provide.

Sections 143, 168(4) and 305: General functions of responsible insolvency practitioner

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Sections 143, 168(4) and 305 are modified so as to read as follows—

(143) (1) The functions of the responsible insolvency practitioner of an insolvent partnership and of its insolvent member or members against whom insolvency orders have been made by virtue of article 8 of the Insolvent Partnerships Order 1994, are to secure that the partnership property and the assets of any such corporate member, and the estate of any such individual member, are got in, realised and distributed to their respective creditors and, if there is a surplus of such property or assets or in such estate, to the persons entitled to it. (2) In the carrying out of those functions, and in the management of the partnership property and of the assets of any corporate member and of the estate of any individual member, the responsible insolvency practitioner is entitled, subject to the provisions of this Act, to use his own discretion. (3) It is the duty of the responsible insolvency practitioner, if he is not the official receiver— (a) to furnish the official receiver with such information, (b) to produce to the official receiver, and permit inspection by the official receiver of, such books, papers and other records, and (c) to give the official receiver such other assistance, as the official receiver may reasonably require for the purposes of carrying out his functions in relation to the winding up of the partnership and any corporate member or the bankruptcy of any individual member. (4) The official name of the responsible insolvency practitioner in his capacity as trustee of an individual member shall be “the trustee of the estate of , a bankrupt” (inserting the name of the individual member); but he may be referred to as “the trustee in bankruptcy” of the particular member.

Sections 146 and 331: Duty to summon final meeting of creditors

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Sections 146 and 331 are modified so as to read as follows—

(146) (1) This section applies, subject to subsection (3) of this section and section 332 below, if it appears to the responsible insolvency practitioner of an insolvent partnership which is being wound up by virtue of article 8 of the Insolvent Partnerships Order 1994 and of its insolvent member or members that the winding up of the partnership or of any corporate member, or the administration of any individual member’s estate, is for practical purposes complete and the practitioner is not the official receiver. (2) The responsible insolvency practitioner shall summon a final general meeting of the creditors of the partnership or of the insolvent member or members (as the case may be) or a combined final general meeting of the creditors of the partnership and of the insolvent member or members which— (a) shall as appropriate receive the practitioner’s report of the winding up of the insolvent partnership or of any corporate member or of the administration of the estate of any individual member, and (b) shall determine whether the practitioner should have his release under section 174 in Chapter VII of this Part in respect of the winding up of the partnership or of the corporate member, or the administration of the individual member’s estate (as the case may be). (3) The responsible insolvency practitioner may, if he thinks fit, give the notice summoning the final general meeting at the same time as giving notice of any final distribution of the partnership property or the property of the insolvent member or members; but, if summoned for an earlier date, that meeting shall be adjourned (and, if necessary, further adjourned) until a date on which the practitioner is able to report to the meeting that the winding up of the partnership or of any corporate member, or the administration of any individual member’s estate, is for practical purposes complete. (4) In the carrying out of his functions in the winding up of the partnership and of any corporate member and the administration of any individual member’s estate, it is the duty of the responsible insolvency practitioner to retain sufficient sums from the partnership property and the property of any such insolvent member to cover the expenses of summoning and holding any meeting required by this section.

Section 147: Power of court to stay proceedings

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Section 147 is modified, so far as insolvent partnerships are concerned, so as to read as follows—

(147) (1) The court may, at any time after an order has been made by virtue of article of the Insolvent Partnerships Order 1994 for winding up an insolvent partnership, on the application either of the responsible insolvency practitioner or the official receiver or any creditor or contributory, and on proof to the satisfaction of the court that all proceedings in the winding up of the partnership ought to be stayed, make an order staying the proceedings, either altogether or for a limited time, on such terms and conditions as the court thinks fit. (2) If, in the course of hearing an insolvency petition presented against a member of an insolvent partnership, the court is satisfied that an application has been or will be made under subsection (1) in respect of a winding-up order made against the partnership, the court may adjourn the petition against the insolvent member, either conditionally or unconditionally. (3) Where the court makes an order under subsection (1) staying all proceedings on the order for winding up an insolvent partnership— (a) the court may, on hearing any insolvency petition presented against an insolvent member of the partnership, dismiss that petition; and (b) if any insolvency order has already been made by virtue of article 8 of the Insolvent Partnerships Order 1994 in relation to an insolvent member of the partnership, the court may make an order annulling or rescinding that insolvency order, or may make any other order that it thinks fit. (4) The court may, before making any order under this section, require the official receiver to furnish to it a report with respect to any facts or matters which are in his opinion relevant to the application.

Sections 168, 303 and 314(7): Supplementary powers of responsible insolvency practitioner

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Sections 168(1) to (3) and (5), 303 and 314(7) are modified so as to read as follows:—

(168) (1) This section applies where the court has made insolvency orders in respect of an insolvent partnership and one or more of its insolvent members by virtue of article 8 of the Insolvent Partnerships Order 1994. (2) The responsible insolvency practitioner of the partnership and of such member or members may at any time summon either separate or combined general meetings of— (a) the creditors or contributories of the partnership, and (b) the creditors or contributories of the member or members, for the purpose of acertaining their wishes. (3) It is the duty of the responsible insolvency practitioner— (a) to summon separate meetings at such times as the creditors of the partnership or of the member (as the case may be), or the contributories of any corporate member, by resolution (either at the meeting appointing the responsible insolvency practitioner or otherwise) may direct, or whenever requested in writing to do so by one-tenth in value of such creditors or contributories (as he case may be); and (b) to summon combined meetings at such times as the creditors of the partnership and of the member or members by resolution (either at the meeting appointing the responsible insolvency practitioner or otherwise) may direct, or whenever requested in writing to do so by one-tenth in value of such creditors. (4) The responsible insolvency practitioner may apply to the court (in the prescribed manner) for directions in relation to any particular matter arising in the winding up of the insolvent partnership or in the winding up or bankruptcy of an insolvent member. (5) If any person is aggrieved by an act or decision of the responsible insolvency practitioner, that person may apply to the court; and the court may confirm, reverse or modify the act or decision complained of, and make such order in the case as it thinks just.

Sections 172 and 298: Removal etc.of responsible insolvency practitioner or of provisional liquidator

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Sections 172 and 298 are modified so as to read as follows—

(172) (1) This section applies with respect to the removal from office and vacation of office of— (a) the responsible insolvency practitioner of an insolvent partnership which is being wound up by virtue of article 8 of the Insolvent Partnerships Order 1994 and of its insolvent member or members against whom insolvency orders have been made, or (b) a provisional liquidator of an insolvent partnership, and of any corporate member of that partnership, against which a winding-up petition is presented by virtue of that article, and, subject to subsections (6) and (7) below, any removal from or vacation of office under this section relates to all offices held in the proceedings relating to the partnership. (2) Subject as follows, the responsible insolvency practitioner or provisional liquidator may be removed from office only by an order of the court. (3) If appointed by the Secretary of State, the responsible insolvency practitioner may be removed from office by a direction of the Secretary of State. (4) A responsible insolvency practitioner or provisional liquidator, not being the official receiver, shall vacate office if he ceases to be a person who is qualified to act as an insolvency practitioner in relation to the insolvent partnership or any insolvent member of it against whom an insolvency order has been made. (5) The responsible insolvency practitioner may, with the leave of the court (or, if appointed by the Secretary of State, with the leave of the court or the Secretary of State), resign his office by giving notice of his resignation to the court. (6) Where a final meeting has been held under section 146 (final meeting of creditors of insolvent partnership or of insolvent members), the responsible insolvency practitioner whose report was considered at the meeting shall vacate office as liquidator of the insolvent partnership or of any corporate member or as trustee of the estate of any individual member (as the case may be as soon as he has given notice to the court (and, in the case of a corporate member, to the registrar of companies) that the meeting has been held and of the decisions (if any) of the meeting. (7) The responsible insolvency practitioner shall vacate office as trustee of the estate of an individual member if the insolvency order against that member is annulled.

Sections 174 and 299: Release of responsible insolvency practitioner or of provisional liquidator

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Sections 174 and 299 are modified so as to read as follows—

(174) (1) This section applies with respect to the release of— (a) the responsible insolvency practitioner of an insolvent partnership which is being wound up by virtue of article 8 of the Insolvent Partnerships Order 1994 and of its insolvent member or members against whom insolvency orders have been made, or (b) a provisional liquidator of an insolvent partnership, and of any corporate member of that partnership, against which a winding-up petition is presented by virtue of that article. (2) Where the official receiver has ceased to be the responsible insolvency practitioner and a person is appointed in his stead, the official receiver has his release with effect from the following time, that is to say— (a) in a case where that person was nominated by a combined general meeting of creditor of the partnership and of any insolvent member or members, or was appointed by the Secretary of State, the time at which the official receiver gives notice to the court that he has been replaced; (b) in a case where that person is appointed by the court, such time as the court may determine. (3) If the official receiver while he is a responsible insolvency practitioner give notice to the Secretary of State that the winding up of the partnership or of any corporate member or the administration of the estate of any individual member is for practical purposes complete, he has his release as liquidator or trustee (as the case may be) with effect from such time as the Secretary of State may determine. (4) A person other than the official receiver who has ceased to be a responsible in solvency practitioner has his release with effect from the following time, that is to say— (a) in the case of a person who has died, the time at which notice is given to the court in accordance with the rules that that person has ceased to hold office; (b) in the case of a person who has been removed from office by the court or by the Secretary of State, or who has vacated office under section 172(4), such time as the Secretary of State may, on an application by that person, determine; (c) in the case of a person who has resigned, such time as may be directed by the court (or, if he was appointed by the Secretary of State, such time as may be directed by the court or as the Secretary of State may, on an application by that person, determine); (d) in the case of a person who has vacated office under section 172(6)— (i) if the final meeting referred to in that subsection has resolved against that person’s release, such time as the Secretary of State may, on an application by that person, determine, and (ii) if that meeting has not so resolved, the time at which that person vacated office. (5) A person who has ceased to hold office as a provisional liquidator has his release with effect from such time as the court may, on an application by him, determine. (6) Where a bankruptcy order in respect of an individual member is annulled, the responsible insolvency practitioner at the time of the annulment has his release with effect from such time as the court may determine. (7) Where the responsible insolvency practitioner or provisional liquidator (including in both cases the official receiver when so acting) has his release under this section, he is, with effect from the time specified in the preceding provisions of this section discharged from all liability both in respect of acts or omissions of his in the winding up of the insolvent partnership or any corporate member or the administration of the estate of any individual member (as the case may be) and otherwise in relation to his conduct as responsible insolvency practitioner or provisional liquidator. - But nothing in this section prevents the exercise, in relation to a person who has had his release under this section, of the court’s powers under section 212 (summary remedy against delinquent directors, liquidators, etc.) or section 304 (liability of trustee).

Sections 175 and 328: Priority of expenses and debts

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Sections 175 and 328(1) to (3) and (6) are modified so as to read as follows—