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The Smart Meter Communication Licensee Administration (England and Wales) Rules 2020

Type Statutory-Instrument

Publication 2020-06-19

State In force

Department Queen's Printer of Acts of Parliament

Source legislation.gov.uk

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(1) A person claiming to be a creditor of the SMCL and wishing to recover the person’s debt in whole or part must submit the person’s claim in writing to the SMCL administrator, unless this Rule or an order of the court provides otherwise.

(2) A creditor who claims for a debt is referred to as “proving” for that debt and a document by which the creditor seeks to establish their claim is the creditor’s “proof”.

(3) A proof must—

(a) be made out by, or under the direction of, the creditor and be authenticated by the creditor or a person authorised on the creditor’s behalf; and

(b) state the following matters—

(i) the creditor’s name and address;

(ii) if the creditor is a company, its registered number;

(iii) the total amount of the creditor’s claim (including any value added tax) as at the date on which the SMCL entered SMCL administration, less any payments made after that date in respect of the claim, any deduction under Rule 58 and any adjustment by way of set off in accordance with Rule 59;

(iv) whether or not the claim includes outstanding uncapitalised interest;

(v) particulars of how and when the debt was incurred by the SMCL;

(vi) particulars of any security held, the date on which it was given and the value which the creditor puts on it;

(vii) details of any reservation of title in respect of goods to which the debt refers; and

(viii) the name, address and authority of the person authenticating the proof (if a person other than the creditor).

(4) There must be specified in the proof details of any document by reference to which the debt can be substantiated; but the document need not be delivered with the proof unless the SMCL administrator has requested it.

(5) The SMCL administrator may call for the creditor to produce any document or other evidence which the SMCL administrator considers is necessary to substantiate the whole or any part of a claim.

(6) A creditor is deemed to have proved for the purposes of determination and payment of a dividend but not otherwise where—

(a) the debt is a small debt;

(b) a notice has been delivered to the creditor under Rule 73 which complies with Rule 74 (further contents of notice to creditors owed small debts); and

(7) For the purposes of this Part “small debt” means a debt (being the total amount owed to a creditor) which does not exceed £1,000 (which amount is prescribed for the purposes of paragraph 13A of Schedule 8 to the 1986 Act[^f00035]).

Provable debts

49

(1) Subject as follows, in SMCL administration proceedings all claims by creditors are provable as debts against the SMCL, whether they are present or future, certain or contingent, ascertained or sounding only in damages.

(2) Any obligation arising under a confiscation order made under Part 2, 3 or 4 of the Proceeds of Crime Act 2002[^f00036] is not provable.

(3) The following are not provable except at a time when all other claims of creditors in the SMCL administration proceedings (other than any of a kind mentioned in this paragraph) have been paid in full with interest under Rule 62—

(a) any claim arising by virtue of section 382(1)(a) of the Financial Services and Markets Act 2000[^f00037], not being a claim also arising by virtue of section 382(1)(b) of that Act;

(b) any claim which by virtue of the 1986 Act or any other enactment is a claim the payment of which is to be postponed.

(4) Nothing in this Rule prejudices any enactment or rule of law under which a particular kind of debt is not provable, whether on grounds of public policy or otherwise.

Costs of proving

50

Unless the court otherwise orders—

(a) every creditor bears the cost of proving the creditor’s own debt, including costs incurred in providing documents or evidence under Rule 48(5); and

(b) costs incurred by the SMCL administrator in estimating the value of a debt under Rule 57 are payable out of the assets as an expense of the SMCL administration.

SMCL administrator to allow inspection of proofs

51

The SMCL administrator must, so long as proofs delivered to the SMCL administrator are in the possession of the SMCL administrator, allow them to be inspected, at all reasonable times on any business day, by any of the following persons—

(a) any creditor who has delivered a proof (unless the creditor’s proof has been wholly rejected for purposes of dividend or otherwise);

(b) any contributory of the SMCL; and

New SMCL administrator appointed

52

(1) If a new SMCL administrator is appointed in place of another, the former SMCL administrator must as soon as reasonably practicable deliver to the new SMCL administrator all proofs which the former SMCL administrator has received, together with an itemised list of them.

(2) As soon as reasonably practicable following receipt of the itemised list and all of the proofs listed by it, the itemised list must be authenticated by the new SMCL administrator and returned to the former SMCL administrator.

Admission and rejection of proofs for dividend

53

(1) The SMCL administrator may admit or reject a proof for dividend (in whole or in part).

(2) If the SMCL administrator rejects a proof in whole or in part, the SMCL administrator must deliver to the creditor a statement of the SMCL administrator’s reasons for doing so, as soon as reasonably practicable.

Appeal against decision on proof

54

(1) If a creditor is dissatisfied with the SMCL administrator’s decision with respect to the creditor’s proof (including any decision on whether the debt is preferential), the creditor may apply to the court for the decision to be reversed or varied.

(2) The application must be made within 21 days of the creditor receiving the statement delivered under Rule 53(2).

(3) A member or any other creditor may, if dissatisfied with the SMCL administrator’s decision admitting or rejecting the whole or any part of a proof, make such an application within 21 days of becoming aware of the SMCL administrator’s decision.

(4) Where an application is made to the court under this Rule, the court must fix a venue for the application to be heard, notice of which must be sent by the applicant to the creditor who delivered the proof in question (if the applicant is not the creditor who delivered the proof) and the SMCL administrator.

(5) The SMCL administrator must, on receipt of the notice, file the relevant proof with the court, together (if appropriate) with a copy of the statement sent under Rule 53(2).

(6) Where the application is made by a member, the court must not disallow the proof (in whole or in part) unless the member shows that there is (or would be but for the amount claimed in the proof), or that it is likely that there will be (or would be but for the amount claimed in the proof), a surplus of assets to which the SMCL would be entitled.

(7) After the application has been heard and determined, the proof must, unless it has been wholly disallowed, be returned by the court to the SMCL administrator.

(8) The SMCL administrator is not personally liable for costs incurred by any person in respect of an application under this Rule unless the court otherwise orders.

Withdrawal or variation of proof

55

A creditor’s proof may at any time, by agreement between the creditor and the SMCL administrator, be withdrawn or varied as to the amount claimed.

Exclusion of proof by the court

56

(1) The court may exclude a proof or reduce the amount claimed—

(a) on the SMCL administrator’s application, where the SMCL administrator thinks that the proof has been improperly admitted, or ought to be reduced; or

(b) on the application of a creditor, if the SMCL administrator declines to interfere in the matter.

(2) Where application is made to the court under this Rule, the court must fix a venue for the application to be heard, notice of which must be sent by the applicant—

(a) in the case of an application by the SMCL administrator, to the creditor who submitted the proof; and

(b) in the case of an application by a creditor, to the SMCL administrator and to the creditor who submitted the proof (if that creditor is not the applicant).

CHAPTER 2 — Quantification of claims

Estimate of value of debt

57

(1) The SMCL administrator must estimate the value of any debt which, by reason of its being subject to any contingency or for any other reason, does not have a certain value; and the SMCL administrator may revise any estimate previously made, if the SMCL administrator thinks fit by reference to any change of circumstances or to information becoming available.

(2) The SMCL administrator must inform the creditor as to the estimate under paragraph (1) and any revision of it.

(3) Where the value of a debt is estimated under this Rule, the amount provable in the SMCL administration in the case of that debt is that of the estimate for the time being.

Discounts

58

There must in every case be deducted from the claim all trade and other discounts which would have been available to the SMCL but for its SMCL administration except any discount for immediate, early or cash settlement.

Mutual credits and set off

59

(1) This Rule applies where the SMCL administrator has delivered a notice under Rule 73 (notice of a proposed distribution).

(2) In this Rule “mutual dealings” means mutual credits, mutual debts or other mutual dealings between the SMCL and a creditor proving or claiming to prove for a debt in the SMCL administration but does not include—

(a) any debt arising out of an obligation incurred after the SMCL entered SMCL administration;

(b) any debt arising out of an obligation incurred at a time when the creditor had notice that—

(i) an application under section 161 of the 2004 Act (permission to pass resolution for voluntary winding up) was pending;

(ii) a petition for the winding up of the SMCL was pending;

(iii) an application for an administration order under the 1986 Act was pending;

(iv) an application for an SMCL administration order was pending; or

(v) any person had given notice of intention to appoint an administrator under the 1986 Act;

(c) any debt which has been acquired by a creditor by assignment or otherwise, pursuant to an agreement between the creditor and any other party where that agreement was entered into—

(i) at a time when the creditor had notice that an application under section 161 of the 2004 Act was pending;

(ii) at a time when the creditor had notice that a petition for the winding up of the SMCL was pending;

(iii) at a time when the creditor had notice that an application for an administration order under the 1986 Act was pending;

(iv) at a time when the creditor had notice that an application for an SMCL administration order was pending;

(v) at a time when the creditor had notice that any person had given notice of intention to appoint an administrator under the 1986 Act; or

(vi) after the SMCL entered SMCL administration.

(3) An account must be taken as at the date of the notice referred to in paragraph (1) of what is due from each party to the other in respect of the mutual dealings and the sums due from one party must be set off against the sums due from the other.

(4) A sum must be treated as being due to or from the SMCL for the purposes of paragraph (3) whether—

(a) it is payable at present or in the future;

(b) the obligation by virtue of which it is payable is certain or contingent; or

(5) Rule 57 applies for the purposes of this Rule to any obligation to or from the SMCL which, by virtue of its being subject to any contingency or for any other reason, does not bear a certain value.

(6) Rules 60 to 62 apply for the purposes of this Rule in relation to any sums due to the SMCL which—

(a) are payable in a currency other than sterling;

(b) are of a periodical nature; or

(7) Rule 86 applies for the purposes of this Rule to any sum due to or from the SMCL which is payable in the future.

(8) Only the balance (if any) of the account owed to the creditor is provable in the SMCL administration.

(9) Alternatively the balance (if any) owed to the SMCL must be paid to the SMCL administrator as part of the assets except where all or part of the balance results from a contingent or prospective debt owed by the creditor and in such a case the balance (or that part of it which results from the contingent or prospective debt) must be paid if and when the debt becomes due and payable.

(10) In this Rule “obligation” means an obligation however arising, whether by virtue of an agreement, rule of law or otherwise.

Debt in foreign currency

60

(1) A proof for a debt incurred or payable in a currency other than sterling must state the amount of the debt in that currency.

(2) The SMCL administrator must convert all such debts into sterling at a single rate for each currency determined by the SMCL administrator by reference to the exchange rates prevailing on the date on which the SMCL entered SMCL administration.

(3) On the next occasion when the SMCL administrator communicates with the creditors the SMCL administrator must advise them of any rate so determined.

(4) A creditor who considers that the rate determined by the SMCL administrator is unreasonable may apply to the court.

(5) If on hearing the application the court finds that the rate is unreasonable it may itself determine the rate.

Payments of a periodical nature

61

(1) In the case of rent and other payments of a periodical nature, the creditor may prove for any amounts due and unpaid up to the date on which the SMCL entered SMCL administration.

(2) Where at that date any payment was accruing due, the creditor may prove for so much as would have been due at that date, if accruing from day to day.

Interest

62

(1) Where a debt proved in the SMCL administration bears interest, that interest is provable as part of the debt except in so far as it is payable in respect of any period after the relevant date.

(2) In the circumstances set out in this Rule, the creditor’s claim may include interest on the debt for periods before the relevant date although not previously reserved or agreed.

(3) If the debt is due by virtue of a written instrument, and payable at a certain time, interest may be claimed for the period from that time to the relevant date.

(4) If the debt is due otherwise, interest may only be claimed if, before the relevant date, demand for payment of the debt was made in writing by or on behalf of the creditor, and notice was given that interest would be payable from the date of the demand to the date of payment.

(5) Interest under paragraph (4) may only be claimed for the period from the date of the demand to the relevant date and, for the purposes of the 1986 Act and these Rules, must be charged at a rate not exceeding that mentioned in paragraph (6).

(6) The rate of interest to be claimed under paragraphs (3) and (4) is the rate specified in section 17 of the Judgments Act 1838[^f00038] on the relevant date.

(7) Any surplus remaining after payment of the debts proved must, before being applied for any other purpose, be applied in paying interest on those debts in respect of the periods during which they have been outstanding since the relevant date.

(8) All interest payable under paragraph (7) ranks equally whether or not the debts on which it is payable rank equally.

(9) The rate of interest payable under paragraph (7) is whichever is the greater of the rate specified under paragraph (6) and the rate applicable to the debt apart from the SMCL administration.

(10) In this Rule, “relevant date” means the date on which the SMCL entered SMCL administration.

Debt payable at future time

63

A creditor may prove for a debt of which payment was not yet due on the date when the SMCL entered SMCL administration, subject to Rule 86 (adjustment of dividend where payment made before time).

Voluntary surrender of security

64

A creditor who voluntarily surrenders a security may prove for the whole of the creditor’s debt as if it were unsecured.

Value of security

65

(1) A secured creditor may, with the agreement of the SMCL administrator or the permission of the court, at any time alter the value which the secured creditor’s proof puts upon the secured creditor’s security.

(2) However, if a secured creditor has voted in respect of the unsecured balance of the secured creditor’s debt the secured creditor may re-value the secured creditor’s security only with permission of the court.

Surrender for non-disclosure

66

(1) If a secured creditor fails to disclose a security in the secured creditor’s proof, the secured creditor must surrender that security for the general benefit of creditors, unless the court, on application by the secured creditor, relieves the secured creditor from the effect of this Rule on the grounds that the omission was inadvertent or the result of honest mistake.

(2) If the court grants that relief, it may require or allow the creditor’s proof to be amended, on such terms as may be just.

(3) Nothing in this Rule or the following two Rules affects the rights in rem of creditors or third parties in respect of tangible or intangible, moveable or immoveable assets (including both specific assets and collections of indefinite assets as a whole which change from time to time) belonging to the debtor that are situated outside the United Kingdom.

Redemption by SMCL administrator

67

(1) The SMCL administrator may at any time deliver a notice to a creditor whose debt is secured that the SMCL administrator proposes, at the expiration of 28 days from the date of the notice, to redeem the security at the value put upon it in the creditor’s proof.

(2) The creditor then has 21 days (or such longer period as the SMCL administrator may allow) in which, if the creditor so wishes, to alter the value of the creditor’s security in accordance with Rule 65.

(3) If the creditor alters the value of the security in accordance with Rule 65, the SMCL administrator may only redeem at the new value.

(4) If the SMCL administrator redeems the security, the cost of transferring it is payable out of the assets of the SMCL.

(5) A secured creditor may at any time deliver a notice to the SMCL administrator requiring the SMCL administrator to elect whether or not to redeem the security at the value then placed on it; and the SMCL administrator then has three months in which to redeem the security or elect not to redeem the security.

Test of security’s value

68

(1) If the SMCL administrator is dissatisfied with the value which a secured creditor puts on the creditor’s security (whether in the creditor’s proof or by way of revaluation under Rule 65), the SMCL administrator may require any property comprised in the security to be offered for sale.

(2) The terms of the sale must be such as may be agreed between the SMCL administrator and the secured creditor, or as the court may direct; and if the sale is by auction, the SMCL administrator on behalf of the SMCL, and the creditor on the creditor’s own behalf, may appear and bid.

(3) This Rule does not apply if the value of the security has been altered with the court’s permission.

Realisation of security by creditor

69

If a creditor who has valued the creditor’s security subsequently realises it (whether or not at the instance of the SMCL administrator)—

(a) the net amount realised must be treated in all respects (including in relation to any valuation in a proof) as an amended valuation made by the creditor; and

(b) the creditor may prove for the balance of the creditor’s debt.

CHAPTER 3 — Distributions

Distribution to creditors generally

70

(1) This Chapter applies where the SMCL administrator makes, or proposes to make, a distribution to any class of creditors other than secured creditors.

(2) Where the distribution is to a particular class of creditors, a reference in this Chapter to creditors is, in so far as the context requires, a reference to that class of creditors only.

Debts of insolvent SMCL to rank equally

71

Debts other than preferential debts rank equally between themselves in the SMCL administration and, after the preferential debts, must be paid in full unless the assets are insufficient for meeting them, in which case they abate in equal proportions between themselves.

Supplementary provisions as to dividend

72

(1) In the calculation and distribution of a dividend the SMCL administrator must make provision for—

(a) any debts which appear to the SMCL administrator to be due to persons who, by reason of the distance of their place of residence, may not have had sufficient time to tender and establish their proofs;

(b) any debts which are the subject of claims which have not yet been determined; and

(2) A creditor who has not proved the creditor’s debt before the declaration of any dividend is not entitled to disturb, by reason that the creditor has not participated in it, the distribution of that dividend or any other dividend declared before the creditor’s debt was proved, but—

(a) when the creditor has proved that debt the creditor is entitled to be paid, out of any money for the time being available for the payment of any further dividend, any dividend which the creditor has failed to receive; and

(b) any dividend payable under sub-paragraph (a) must be paid before the money is applied to the payment of any such further dividend.

(3) No action lies against the SMCL administrator for a dividend, but if the SMCL administrator refuses to pay a dividend the court may, if it thinks just, order the SMCL administrator to pay it and also to pay, out of the SMCL administrator’s own money—

(a) interest on the dividend, at the rate for the time being specified in section 17 of the Judgments Act 1838, from the time when it was withheld; and

(b) the costs of the proceedings in which the order to pay is made.

Notice of proposed distribution

73

(1) Where the SMCL administrator is proposing to make a distribution to creditors or declare a dividend the SMCL administrator must give notice of the fact.

(2) The notice given pursuant to paragraph (1) must—

(a) be delivered to all creditors whose addresses are known to the SMCL administrator;

(b) state whether the proposed distribution or dividend is—

(i) to preferential creditors; or

(ii) preferential creditors and unsecured creditors;

(c) state that it is the intention of the SMCL administrator to make a distribution to creditors or declare a dividend (as the case may be) within the period of two months from the last date for proving;

(d) specify whether the proposed distribution or dividend is interim or final;

(e) specify a date up to which proofs must be delivered being a date which—

(i) is the same date for all creditors; and

(ii) is not less than 21 days from that of the notice;

(f) specify the place to which proofs must be delivered;

(g) include the additional information required by Rule 74 where the SMCL administrator intends to treat a small debt as proved for the purposes of paying a dividend; and

(h) where the SMCL administrator proposes to declare a dividend to unsecured creditors, state the value of the prescribed part, except where the court has made an order under section 176A(5) of the 1986 Act.

(3) Subject to paragraph (4)(b), a copy of the notice—

(a) must be gazetted; and

(b) may be advertised in such other manner as the SMCL administrator thinks fit.

(4) Where the proposed dividend is only to preferential creditors—

(a) the notice need only be delivered to those creditors in whose cases the SMCL administrator has reason to believe that their debts are preferential; and

(b) the notice need only be gazetted if the SMCL administrator thinks fit.

Further contents of notice to creditors owed small debts etc.

74

(1) The SMCL administrator may treat a debt, which is a small debt according to the accounting records or the statement of affairs of the SMCL, as if it were proved for the purposes of paying a dividend.

(2) Where the SMCL administrator intends to treat such a debt as if it were proved, the notice delivered under Rule 73 must also—

(a) state the amount of the debt which the SMCL administrator believes to be owed to the creditor according to the accounting records or statement of affairs of the SMCL;

(b) state that the SMCL administrator will treat the debt which is stated in the notice, being for £1,000 or less, as proved for the purposes of paying a dividend unless the creditor advises the SMCL administrator that the amount of the debt is incorrect or that no debt is owed;

(c) require the creditor to notify the SMCL administrator by the last date for proving if the amount of the debt is incorrect or if no debt is owed; and

(d) inform the creditor that where the creditor advises the SMCL administrator that the amount of the debt is incorrect the creditor must also submit a proof to receive a dividend.

(3) The information required by paragraph (2)(a) may take the form of a list of small debts which the SMCL administrator intends to treat as proved which includes the debt owed to the particular creditor to whom the notice is being delivered.

Sole or final dividend

75

(1) Where it is intended that the distribution is to be a sole or final dividend, the SMCL administrator must, after the last date for proving set out in the notice under Rule 73—

(a) pay any sums payable in accordance with the provisions of paragraph 99 of Schedule B1 to the 1986 Act;

(b) pay any sums (including any debts or liabilities and the SMCL administrator’s own remuneration and expenses) which would, if the SMCL administrator were to cease to be the SMCL administrator of the SMCL, be payable out of the property of which the SMCL administrator had custody or control in accordance with the provisions of paragraph 99 of Schedule B1 to the 1986 Act; and

(c) declare and distribute that dividend without regard to the claim of any person in respect of a debt not already proved.

(2) The reference in paragraph (1)(c) to debts that have not been proved does not include small debts treated as proved by the SMCL administrator.

(3) The court may, on the application of any person, postpone the date specified in the notice as the last date for proving.

Admission or rejection of proofs following last date for proving

76

(1) Unless the SMCL administrator has already dealt with them, the SMCL administrator must within five business days of the last date for proving set out in the notice under Rule 73—

(a) admit or reject (in whole or in part) proofs delivered to the SMCL administrator; or

(b) make such provision in respect of them as the SMCL administrator thinks fit.

(2) The SMCL administrator is not obliged to deal with a proof delivered after the last date for proving, but may do so, if the SMCL administrator thinks fit.

(3) In the declaration of a dividend a payment must not be made more than once in respect of the same debt.

Postponement or cancellation of dividend

77

The SMCL administrator may postpone or cancel a dividend, if in the period of two months referred to in Rule 73(2)(c) an application is made to the court for the SMCL administrator’s decision on a proof to be reversed or varied, or for a proof to be excluded, or for a reduction of the amount claimed.

Declaration of dividend

78

(1) Subject to Rule 77 and paragraph (2), within the two month period referred to in Rule 73(2)(c), the SMCL administrator must proceed to declare the dividend of which the SMCL administrator gave notice.

(2) Except with the permission of the court, the SMCL administrator must not declare a dividend so long as there is pending any application to the court to reverse or vary a decision of the SMCL administrator’s on a proof, or to exclude a proof or to reduce the amount claimed.

(3) If the court gives permission under paragraph (2), the SMCL administrator must make such provision in respect of the proof in question as the court directs.

Notice of declaration of a dividend

79

(1) Where the SMCL administrator declares a dividend the SMCL administrator must deliver notice of that fact to all creditors who have proved their debts.

(2) The notice must include the following particulars relating to the SMCL administration—

(a) amounts raised from the sale of assets, indicating (so far as is practicable) amounts raised by the sale of particular assets;

(b) payments made by the SMCL administrator when acting as such;

(c) where the SMCL administrator proposed to make a distribution to unsecured creditors, the value of the prescribed part, except where the court has made an order under section 176A(5) of the 1986 Act;

(d) provision (if any) made for unsettled claims, and funds (if any) retained for particular purposes;

(e) the total amount to be distributed and the rate of dividend; and

(f) whether, and if so when, any further dividend is expected to be declared.

80

(1) The dividend may be distributed simultaneously with the notice declaring it.

(2) Payment of the dividend may be made by post, or arrangements may be made with any creditor for it to be paid to the creditor in another way, or held for the creditor’s collection.

Notice of no dividend, or no further dividend

81

If the SMCL administrator delivers notice to creditors that the SMCL administrator is unable to declare any dividend or (as the case may be) any further dividend, the notice must contain a statement to the effect either—

(a) that no funds have been realised; or

(b) that the funds realised have already been distributed or used or allocated for paying the expenses of SMCL administration.

Proof altered after payment of dividend

82

(1) If after payment of dividend the amount claimed by a creditor in the creditor’s proof is increased, the creditor is not entitled to disturb the distribution of the dividend; but the creditor is entitled to be paid, out of any money for the time being available for the payment of any further dividend, any dividend which the creditor has failed to receive.

(2) Any dividend payable under paragraph (1) must be paid before the money there referred to is applied to the payment of any such further dividend.

(3) If, after a creditor’s proof has been admitted, the proof is withdrawn or excluded, or the amount is reduced, the creditor is liable to repay to the SMCL administrator, for the credit of the SMCL administration, any amount overpaid by way of dividend.

Secured creditors

83

(1) The following applies where a creditor alters the value of the creditor’s security at a time when a dividend has been declared.

(2) If the alteration results in a reduction of the creditor’s unsecured claim ranking for dividend, the creditor must as soon as reasonably practicable repay to the SMCL administrator, for the credit of the SMCL administration, any amount received by the creditor as dividend in excess of that to which the creditor would be entitled having regard to the alteration of the value of the security.

(3) If the alteration results in an increase of the creditor’s unsecured claim, the creditor is entitled to receive from the SMCL administrator, out of any money for the time being available for the payment of a further dividend, before any such further dividend is paid, any dividend which the creditor has failed to receive, having regard to the alteration of the value of the security.

(4) However, the creditor is not entitled to disturb any dividend declared (whether or not distributed) before the date of the alteration.

Disqualification from dividend

84

If a creditor contravenes any provision of the 1986 Act or these Rules relating to the valuation of securities, the court may, on the application of the SMCL administrator, order that the creditor be wholly or partly disqualified from participation in any dividend.

Assignment of right to dividend

85

(1) If a person entitled to a dividend (“the entitled person”) delivers notice to the SMCL administrator that the entitled person wishes the dividend to be paid to another person, or that the entitled person has assigned the entitlement to another person, the SMCL administrator must pay the dividend to that other person accordingly.

(2) A notice delivered under this Rule must specify the name and address of the person to whom payment is to be made.

Adjustment where dividend paid before time

86

(1) Where a creditor has proved for a debt of which payment is not due at the date of the declaration of a dividend, the creditor is entitled to the dividend equally with other creditors, but subject as follows.

(2) For the purpose of dividend (and no other purpose), the amount of the creditor’s admitted proof (or, if a distribution has previously been made to the creditor, the amount remaining outstanding in respect of the creditor’s admitted proof) is to be reduced by applying the following formula—

where— “x” is the value of the admitted proof; and “n” is the period beginning with the date on which the SMCL entered SMCL administration and ending with the date on which the payment of the creditor’s debt would otherwise be due expressed in years (part of a year being expressed as a decimal fraction of a year).

Division of unsold assets

87

(1) The SMCL administrator may, with the permission of the creditors, divide in its existing form amongst the SMCL’s creditors, according to its estimated value, any property which from its peculiar nature or other special circumstances cannot be readily or advantageously sold.

(2) The SMCL administrator must—

(a) in the receipts and payments account included in the progress report under Rule 26, state the estimated value of the property divided amongst the creditors of the SMCL during the period to which the report relates; and

(b) as a note to the account, provide details of the basis of the valuation.

PART 8 — The SMCL administrator

Fixing of remuneration

88

(1) The SMCL administrator is entitled to receive remuneration for services as SMCL administrator.

(2) The remuneration must be fixed by reference to the time properly given by the SMCL administrator and the SMCL administrator’s staff in attending to matters arising in the SMCL administration.

(3) The SMCL administrator must make an application to court for the remuneration to be fixed by the court.

(4) The SMCL administrator must deliver at least 14 days’ notice of the SMCL administrator’s application to the following, who may appear or be represented—

(a) the Secretary of State;

(b) GEMA; and

(5) In fixing the remuneration, the court must have regard to the following matters—

(a) the complexity (or otherwise) of the case;

(b) any respects in which, in connection with the SMCL’s affairs, there falls on the SMCL administrator any responsibility of an exceptional kind or degree;

(c) the effectiveness with which the SMCL administrator appears to be carrying out, or to have carried out, the SMCL administrator’s duties as such; and

(d) the value and nature of the property with which the SMCL administrator has to deal.

(6) Where there are joint SMCL administrators, it is for them to agree between themselves how the remuneration payable should be apportioned; and any dispute arising between them may be referred to the court for settlement by order.

(7) If the SMCL administrator is a solicitor and employs the SMCL administrator’s own firm, or any partner in it, to act on behalf of the SMCL, profit costs must not be paid unless this is authorised by the court.

Remuneration of new SMCL administrator

89

If a new SMCL administrator is appointed in place of another, any court order in effect under Rule 88 immediately before the former SMCL administrator ceased to hold office continues to apply in respect of the remuneration of the new SMCL administrator until a further court order is made in accordance with those provisions.

PART 9 — Ending SMCL administration

Final progress reports

90

In this Part—

“final progress report” means a progress report which includes a summary of— the SMCL administrator’s proposals; any major amendments to, or deviations from, those proposals; the steps taken during the SMCL administration; and the outcome; and

“progress report” means a report which complies with Rule 26.

Application to court

91

(1) An application to court under paragraph 79 of Schedule B1 to the 1986 Act[^f00039] for an order ending an SMCL administration must have attached to it—

(a) a progress report for the period since—

(i) the last progress report (if any), or

(ii) if there has been no previous progress report, the date on which the SMCL entered SMCL administration; and

(b) a statement indicating what the applicant thinks should be the next steps for the SMCL (if applicable).

(2) Where such an application is made, the applicant must—

(a) at least five business days before the application is made, deliver notice of the applicant’s intention to apply to court to—

(i) the person who made the application for the SMCL administration order (unless the applicant in both cases is the same); and

(ii) the creditors of the SMCL; and

(b) attach to the application to court a statement that notice has been delivered to the creditors, and copies of any response from creditors to that notice.

(3) Where such an application is made other than by the SMCL administrator—

(a) the applicant must also, at least five business days before the application is made, deliver notice to the SMCL administrator of the applicant’s intention to apply to court; and

(b) upon receipt of such notice the SMCL administrator must, before the end of the five business day notice period, provide the applicant with a progress report for the period since the last progress report (if any) or the date the SMCL entered SMCL administration.

(4) Where the application is made other than by the Secretary of State, the application must also state that it is made with the consent of the Secretary of State.

(5) Where the SMCL administrator applies to court under paragraph 79 of Schedule B1 to the 1986 Act in conjunction with a petition under section 124 of the 1986 Act[^f00040] for an order to wind up the SMCL, the notice to creditors under paragraph (2)(a)(ii) must also state whether the SMCL administrator intends to seek appointment as liquidator.

Notification by SMCL administrator of court order

92

(1) Where the court makes an order to end the SMCL administration, it must, where the applicant is not the SMCL administrator, deliver a copy of the order to the SMCL administrator.

(2) The SMCL administrator must as soon as reasonably practicable deliver a copy of the order and a copy of the final progress report to—

(a) the registrar of companies;

(b) the directors of the SMCL; and

(c) the Secretary of State, GEMA and all those persons to whom notice of the SMCL administrator’s appointment was delivered.

Moving from SMCL administration to creditors’ voluntary liquidation

93

(1) Where, for the purposes of paragraph 83(3) of Schedule B1 to the 1986 Act, the SMCL administrator delivers to the registrar of companies a notice of moving from SMCL administration to creditors’ voluntary liquidation, the notice must include the name and IP number of the proposed liquidator.

(2) The notice to the registrar of companies must be accompanied by a copy of the SMCL administrator’s final progress report (which must include details of the assets to be dealt with in the liquidation).

(3) As soon as reasonably practicable after delivery of the notice to the registrar of companies, the SMCL administrator must deliver—

(a) a copy of the notice and final progress report to the Secretary of State, GEMA and all those persons to whom notice of the SMCL administrator’s appointment was delivered; and

(b) a copy of the final progress report with any other copy of the notice that is sent as required by paragraph 83(5)(b) of Schedule B1 to the 1986 Act.

(4) For the purposes of paragraph 83(7)(a) of Schedule B1 to the 1986 Act, a person is nominated as liquidator in accordance with Rules 21(7) or 25(3)(e) and that person’s appointment takes effect following registration under paragraph (1) of this Rule—

(a) by virtue of the SMCL administrator’s proposals or revised proposals; or

(b) where a creditors’ meeting is held in accordance with Rule 30, as a consequence of such a meeting.

(5) GEMA must notify the Secretary of State before consenting to the SMCL administrator delivering a notice of moving from SMCL administration to creditors’ voluntary liquidation to the registrar of companies.

Moving from SMCL administration to dissolution

94

(1) Where, for the purposes of paragraph 84(1) of Schedule B1 to the 1986 Act[^f00041], the SMCL administrator delivers to the registrar of companies a notice of moving from SMCL administration to dissolution, the SMCL administrator must attach to that notice a final progress report.

(2) As soon as reasonably practicable after delivering the notice to the registrar of companies, the SMCL administrator must deliver—

(a) a copy of the notice and final progress report to the Secretary of State, GEMA and all those persons to whom notice of the SMCL administrator’s appointment was delivered; and

(b) a copy of the final progress report with any other copy of the notice that is sent as required by paragraph 84(5)(b) of Schedule B1 to the 1986 Act.

(3) Where a court makes an order under paragraph 84(7) of Schedule B1 to the 1986 Act—

(a) it must, where the applicant is not the SMCL administrator, deliver a copy of the order to the SMCL administrator; and

(b) the SMCL administrator must deliver a copy of the order to the registrar of companies with the notice required by paragraph 84(8) of Schedule B1 to the 1986 Act.

(4) GEMA must notify the Secretary of State before directing the SMCL administrator to deliver a notice of moving from SMCL administration to dissolution to the registrar of companies.

Provision of information to the Secretary of State

95

Where the SMCL administration ends pursuant to paragraph 79, 83 or 84 of Schedule B1 to the 1986 Act, the SMCL administrator must, at the same time as delivering the final progress report to the Secretary of State under Rule 92(2), 93(3) or 94(2), provide the Secretary of State with the following information—

(a) a breakdown of the relevant debts (within the meaning of section 7(4) of the 2018 Act) of the SMCL which remain outstanding; and

(b) details of any shortfall (within the meaning of section 7(3)(a) of the 2018 Act) in the property of the SMCL available for meeting those relevant debts.

PART 10 — Replacing the SMCL administrator

Grounds for resignation

96

(1) The SMCL administrator may give notice of resignation—

(a) on the grounds of ill health;

(b) because the SMCL administrator intends ceasing to be in practice as an insolvency practitioner; or

(c) because there is some conflict of interest, or a change in personal circumstances, which prevents or makes impracticable the further discharge by the SMCL administrator of the duties of SMCL administrator.

(2) The SMCL administrator may, with the permission of the court, give notice of the SMCL administrator’s resignation on grounds other than those specified in paragraph (1).

Notice of intention to resign

97

(1) The SMCL administrator must give at least five business days’ notice of the SMCL administrator’s intention—

(a) to resign in a case falling within Rule 96(1); or

(b) to apply for the court’s permission to resign in a case falling within Rule 96(2).

(2) The notice must be delivered—

(a) to the Secretary of State;

(b) to GEMA;

(d) if there is no such SMCL administrator, to the SMCL and its creditors, including any floating charge holders.

(3) The notice must—

(a) be headed “Notice of intention to resign as SMCL administrator”; and

(b) include immediately below the heading—

(i) the full name, registered address, registered number and any other trading names of the SMCL; and

(ii) details of the court where the proceedings are and the relevant court reference number.

(4) The notice must also include—

(a) the date of the appointment of the SMCL administrator;

(b) the name of the person who made the SMCL administration application; and

(c) the date with effect from which the SMCL administrator intends to resign; or the date on which the SMCL administrator intends to file with the court an application for permission to resign.

(5) The notice must be accompanied by a summary of the SMCL administrator’s receipts and payments.

Notice of resignation

98

(1) Notice of resignation under paragraph 87(2) of Schedule B1 to the 1986 Act must be given by filing the notice with the court.

(2) Within five business days of filing the notice of resignation with the court, the SMCL administrator must deliver a copy of the notice to—

(a) the registrar of companies; and

(b) all persons to whom notice of intention to resign was delivered under Rule 97.

(3) The notice of resignation must—

(a) be headed “Notice of resignation by SMCL administrator”; and

(b) include immediately below the heading—

(i) the full name, registered address, registered number and any other trading names of the SMCL; and

(ii) details of the court where the proceedings are and the relevant court reference number.

(4) The notice must also state—

(a) the date of the appointment of the SMCL administrator;

(b) the name of the person who made the SMCL administration application;

(d) where the resignation is with the permission of the court, the date on which permission was given.

Application to court to remove SMCL administrator from office

99

(1) An application for an order under paragraph 88 of Schedule B1 to the 1986 Act that the SMCL administrator be removed from office must state the grounds on which the order is requested.

(2) A copy of the application must be delivered, not less than five business days before the date fixed for the hearing—

(a) to the SMCL administrator;

(b) to the Secretary of State;

(d) to the joint SMCL administrator (if any); and

(e) where there is not a joint SMCL administrator, to the SMCL and its creditors, including any floating charge holders.

(3) Where the court makes an order removing the SMCL administrator it must deliver a copy of the order to the applicant.

(4) Following receipt of a copy of the order, the applicant must deliver a copy of the order—

(a) as soon as reasonably practicable, to the SMCL administrator; and

(b) within five business days, to—

(i) the registrar of companies; and

(ii) all persons to whom a copy of the application was delivered under paragraph (2).

Notice of vacation of office when SMCL administrator ceases to be qualified to act

100

An SMCL administrator who has ceased to be qualified to act as an insolvency practitioner in relation to the SMCL and gives notice in accordance with paragraph 89 of Schedule B1 to the 1986 Act must also deliver notice to—

(a) the Secretary of State;

(b) GEMA; and

SMCL administrator deceased

101

(1) If the SMCL administrator dies, a notice of the fact and date of death must be filed with the court.

(2) The notice must be filed as soon as reasonably practicable by one of the following—

(a) a surviving SMCL administrator;

(b) a member of the deceased SMCL administrator’s firm (if the deceased was a member or employee of a firm);

(d) a personal representative of the deceased SMCL administrator.

(3) If such a notice has not been filed within the 21 days following the SMCL administrator’s death then any other person may file the notice.

(4) The person who files the notice must also deliver a notice to the registrar of companies which contains—

(a) the date of the appointment of the SMCL administrator; and

(b) the fact and date of death.

Application to replace

102

(1) Where an application is made to court under paragraph 91(1) of Schedule B1 to the 1986 Act to appoint a replacement SMCL administrator, the application must be accompanied by a statement in accordance with Rule 6 by the person proposed to be the replacement SMCL administrator.

(2) In addition to those persons referred to in section 156(2) of the 2004 Act and Rule 9(3), the applicant must deliver a copy of the application to the person who made the application for the SMCL administration order.

(3) Rule 171 applies to the service of an application under paragraph 91(1) of Schedule B1 to the 1986 Act as it applies to service of an application for an SMCL administration order.

(4) Rules 11 and 12 apply to an application under paragraph 91(1) of Schedule B1 to the 1986 Act as they apply to an application for an SMCL administration order.

Appointment of replacement or additional SMCL administrator

103

Where a replacement SMCL administrator is appointed or an additional SMCL administrator is appointed as a joint SMCL administrator—

(a) Rule 13 applies;

(b) the replacement or additional SMCL administrator must deliver notice of the appointment to the registrar of companies; and

(c) all documents must clearly identify the appointment as of a replacement SMCL administrator or an additional SMCL administrator appointed as a joint SMCL administrator.

SMCL administrator’s duties on vacating office

104

(1) An SMCL administrator who ceases to be in office as such, in consequence of removal, resignation or ceasing to be qualified to act as an insolvency practitioner, must as soon as reasonably practicable deliver to the person succeeding as SMCL administrator—

(a) the assets (after deduction of any expenses properly incurred and distributions made by the departing SMCL administrator);

(b) the records of the SMCL administration, including correspondence, proofs and other documents relating to the SMCL administration while it was within the responsibility of the departing SMCL administrator; and

(2) It is an offence for the SMCL administrator to fail to comply with this Rule.

PART 11 — Court procedure and practice

CHAPTER 1 — Applications

Preliminary

105

This Chapter applies to any application made to the court in SMCL administration proceedings, except an application for an SMCL administration order.

Contents of application

106

(1) Each application must state—

(a) that the application is made under the 1986 Act or these Rules (as applicable);

(b) the section of the 1986 Act or paragraph of a Schedule to the 1986 Act or the number of the Rule under which it is made;

(d) the name of the SMCL which is the subject of the SMCL administration proceedings;

(e) the court (and where applicable, the division or district registry of that court) in which the application is made;

(f) where the court has previously allocated a number to the SMCL administration proceedings within which the application is made, that number;

(g) the nature of the remedy or order applied for or the directions sought from the court;

(h) the names and addresses of the persons on whom it is intended to serve the application or that no person is intended to be served;

(i) where the 1986 Act or these Rules require that notice of the application is to be delivered to specified persons, the names and addresses of all those persons (so far as known to the applicant); and

(j) the applicant’s address for service.

(2) The application must be authenticated by the applicant if the applicant is acting in person or, when the applicant is not so acting, by or on behalf of the applicant’s solicitor.

Application under section 176A(5) of the 1986 Act to disapply section 176A of the 1986 Act

107

(1) An application under section 176A(5) of the 1986 Act must be accompanied by a witness statement by the SMCL administrator.

(2) The witness statement must—

(a) state that the application arises in the course of an SMCL administration;

(b) contain a summary of the financial position of the SMCL; and

(c) contain the information substantiating the SMCL administrator’s view that the cost of making a distribution to unsecured creditors would be disproportionate to the benefits.

(3) An application under section 176A(5) of the 1986 Act may be made without the application being served upon or notification to any other party.

Notice of order under section 176A(5) of the 1986 Act

108

(1) Where the court makes an order under section 176A(5) of the 1986 Act, it must as soon as reasonably practicable deliver two sealed copies of the order to the SMCL administrator.

(2) Where the court has made an order under section 176A(5) of the 1986 Act, the SMCL administrator must as soon as reasonably practicable deliver notice of the order to each creditor of whose address and claim the SMCL administrator is aware.

(3) Paragraph (2) does not apply where the court directs otherwise.

(4) The court may direct that the requirement in paragraph (2) is complied with if a notice is published by the SMCL administrator which, in addition to containing the contents required by Chapter 4 of Part 14, states that the court has made an order disapplying the requirement to set aside the prescribed part.

(5) As soon as reasonably practicable a notice under paragraph (4)—

(a) must be gazetted; and

(b) may be advertised in such other manner as the SMCL administrator thinks fit.

(6) The SMCL administrator must deliver a copy of the order to the registrar of companies as soon as reasonably practicable after the making of the order.

Filing and service of application

109

(1) An application filed with the court in hard copy form must be accompanied by one copy and a number of additional copies equal to the number of persons who are to be served with the application.

(2) Where an application is filed with the court, the court must fix a venue for the application to be heard unless—

(a) it considers it is not appropriate to do so;

(b) the Rule under which the application is brought provides otherwise; or

(3) The applicant must serve a sealed copy of the application, endorsed with the venue for the hearing, on the respondent named in the application unless the court directs or these Rules provide otherwise.

(4) The court may also give one or more of the following directions—

(a) that the application be served upon persons other than those specified by the relevant provision of the 1986 Act or these Rules;

(b) that service upon any person may be dispensed with;

(d) such other directions as the court sees fit.

(5) A sealed copy of the application must be served at least 14 days before the date fixed for its hearing unless—

(a) the provision of the 1986 Act or these Rules under which the application is made makes different provision; or

(b) the case is one of urgency, to which paragraph (6) applies.

(6) Where the case is one of urgency, the court may (without prejudice to its general power to extend or abridge time limits)—

(a) hear the application immediately, either with or without notice to, or the attendance of, other parties; or

(b) authorise a shorter period of service than that provided for by paragraph (5);

and any such application may be heard on terms providing for the filing or service of documents, or the carrying out of other formalities, as the court thinks just.

Hearings without notice

110

Where the provisions of the 1986 Act or these Rules do not require service of the application on, or notice of it to be delivered to, any person, the court may—

(a) hear the application as soon as reasonably practicable without fixing a venue;

(b) fix a venue for the application to be heard in which case Rule 109 applies to the extent that it is relevant; or

but nothing in those provisions is to be taken as prohibiting the applicant from giving such notice if the applicant wishes to do so.

Hearing of application

111

(1) In the High Court, the jurisdiction of the court to hear and determine an application may be exercised by an Insolvency and Companies Court Judge or district judge of the High Court (to whom any application must be made in the first instance) unless—

(a) a direction to the contrary has been given, or

(b) it is not within the judge’s power to make the order required.

(2) Where the application is made to an Insolvency and Companies Court Judge or district judge of the High Court, that judge may refer to a High Court Judge any matter which the Insolvency and Companies Court Judge or district judge of the High Court thinks should properly be decided by a High Court Judge, and the High Court Judge may either dispose of the matter or refer it back to the Insolvency and Companies Court Judge or district judge of the High Court with such directions as the High Court Judge thinks just.

(3) Nothing in this Rule precludes an application being made directly to a High Court Judge in a proper case.

Witness statements

112

(1) Subject to Rule 113, where evidence is required by the 1986 Act or these Rules as to any matter, such evidence may be given by witness statement unless—

(a) in any specific case a Rule or the 1986 Act makes different provision; or

(b) the court otherwise directs.

(2) Unless the provisions of the 1986 Act or these Rules under which the application is made provide otherwise, or the court otherwise directs—

(a) if the applicant intends to rely at the first hearing on evidence in a witness statement, the applicant must file the witness statement with the court and serve a copy on the respondent, not less than 14 days before the date fixed for the hearing; and

(b) where a respondent to an application intends to oppose it and rely for that purpose on evidence in a witness statement, the respondent must file the witness statement with the court and serve a copy on the applicant, not less than five business days before the date fixed for the hearing.

(3) The court may, on the application of any party to the matter in question, order the attendance for cross-examination of the person making the witness statement.

(4) Where, after such an order has been made, the person in question does not attend, that person’s witness statement must not be used in evidence without the permission of the court.

Use of reports

113

(1) A report may be filed in court by the SMCL administrator instead of a witness statement, unless the application involves other parties or the court otherwise directs.

(2) In any case where a report is filed instead of a witness statement, the report is to be treated for the purposes of Rule 112 and any hearing before the court as if it were a witness statement.

Directions; adjournment of hearings

114

(1) The court may at any time give such directions as it thinks just as to—

(a) service or notice of the application on or to any other person;

(b) whether the application is to be served and generally the procedure on the application including whether a hearing is necessary;

(d) the manner in which any evidence is to be provided and in particular as to—

(i) the taking of evidence wholly or partly by witness statement or orally;

(ii) any report to be made by the SMCL administrator; and

(iii) the cross-examination of the maker of a witness statement or of a report.

(2) The court may adjourn the hearing of an application on such terms as it thinks just.

CHAPTER 2 — Enforcement procedures

Enforcement of court orders

115

In SMCL administration proceedings, orders of the court may be enforced in the same manner as a judgment to the same effect.

Orders enforcing compliance

116

(1) The court may, on an application by the SMCL administrator, make such orders as it thinks necessary for the enforcement of obligations falling on any person in accordance with—

(a) paragraph 47 of Schedule B1 to the 1986 Act (duty to submit statement of affairs); or

(b) section 235 of the 1986 Act (duty to co-operate with SMCL administrator).

(2) An order of the court under this Rule may provide that all costs of and incidental to the application for it are to be borne by the person against whom the order is made.

Warrant under section 236 of the 1986 Act

117

(1) For the purpose of the issue of a warrant under section 236 of the 1986 Act[^f00042] (inquiry into insolvent company’s dealings), the persons referred to in that section as the prescribed officer of the court are the tipstaff and the tipstaff’s assistants of the court.

(2) In this Rule, references to property include books, papers and other documents and records.

(3) When a person is arrested under a warrant issued under section 236 of the 1986 Act (“the arrested person”), the arresting officer must as soon as reasonably practicable bring the arrested person before the court issuing the warrant in order that the arrested person may be examined.

(4) If the arrested person cannot immediately be brought up for examination, the officer must deliver the arrested person into the custody of the governor of the prison named in the warrant (or where that prison is not able to accommodate the arrested person, the governor of such other prison with appropriate facilities that is able to accommodate the arrested person), who must keep the arrested person in custody and produce the arrested person before the court as it may from time to time direct.

(5) After arresting the person named in the warrant, the officer must as soon as reasonably practicable report to the court the arrest or delivery into custody (as the case may be) and apply to the court to fix a venue for the arrested person’s examination.

(6) The court must appoint the earliest practicable time for the examination, and must—

(a) direct the governor of the prison to produce the arrested person for examination at the time and place appointed; and

(b) as soon as reasonably practicable deliver notice of the venue to the SMCL administrator.

(7) Where any property in the arrested person’s possession is seized, the property must, as directed by the warrant, be—

(a) delivered to whoever is specified in the warrant as authorised to receive it, or otherwise dealt with in accordance with the directions in the warrant; or

(b) kept by the officer seizing it pending the receipt of written orders from the court as to its disposal.

CHAPTER 3 — The court file

Court file

118

(1) The court must open and maintain a file (the “court file”) in any case where documents are filed with it under the 1986 Act or these Rules.

(2) Any documents which are filed with the court under the 1986 Act or these Rules must be placed on the court file.

(3) The following persons may inspect the court file, or obtain from the court a copy of the court file, or of any document in the court file—

(a) the SMCL administrator;

(b) the Secretary of State;

(d) a person who is, or at any time has been, a director or officer of the SMCL; and

(e) a person who is a member of the SMCL.

(4) A person’s right to inspect or obtain copies may be exercised on that person’s behalf by someone authorised to do so by that person.

(5) Any person who is not otherwise entitled to inspect the court file or obtain copies may do so if the court gives permission.

(6) The court may direct that the court file, a document (or part of it) or a copy of a document (or part of it) must not be made available under paragraph (3) or (4) without the permission of the court.

(7) An application for a direction under paragraph (6) may be made by—

(a) the SMCL administrator; or

(b) any person appearing to the court to have an interest.

(8) Inspection of the court file, with permission if required, may be at any reasonable time.

(9) The right to a copy of a document is subject to payment of the fee chargeable under an order made under section 92 of the Courts Act 2003[^f00043].

(10) The following applications may be made without notice to any other party, but the court may direct that notice must be delivered to any person who would be affected by its decision—

(a) an application for permission to inspect the court file or obtain a copy of a document under paragraph (5); or

(b) an application for a direction under paragraph (6).

(11) If for the purposes of powers conferred by the 1986 Act or these Rules, the Secretary of State or the SMCL administrator requests the transmission of the court file, the court must comply with the request (unless the file is for the time being in use for the court’s own purposes).

Office copies of documents

119

(1) The court must provide an office copy of a document from the court file to a person who has under these Rules the right to inspect the court file where that person has requested such a copy and paid the fee under Rule 118(9).

(2) A person’s right under this Rule may be exercised on that person’s behalf by someone authorised to do so by that person.

(3) An office copy provided by the court under this Rule must be in such form as the relevant judge thinks appropriate, and must bear the court’s seal.

(4) In this Rule “relevant judge” means the High Court Judge, Insolvency and Companies Court Judge or district judge of the High Court before whom the proceedings are brought.

CHAPTER 4 — Costs and detailed assessment

Application of Chapter and interpretation

120

(1) This Chapter applies to costs of and in connection with SMCL administration proceedings.

(2) In this Chapter, “costs” includes charges and expenses.

(3) CPR Parts 44 and 47[^f00044] (which relate to costs) apply to such costs.

Requirement to assess costs by the detailed procedure

121

(1) Where the costs of any person are payable as an expense out of the assets of the SMCL, the amount payable must be decided by detailed assessment unless agreed between the SMCL administrator and the person entitled to payment.

(2) In the absence of such agreement, the SMCL administrator may serve notice requiring the person entitled to payment to commence detailed assessment proceedings in accordance with CPR Part 47.

(3) Detailed assessment proceedings must be commenced in the court to which the SMCL administration proceedings are allocated.

(4) Where the costs of any person employed by the SMCL administrator in SMCL administration proceedings are required to be decided by detailed assessment or fixed by order of the court, the SMCL administrator may make payments on account to such person in respect of those costs provided that person undertakes in writing—

(a) to repay as soon as reasonably practicable any money which may, when detailed assessment is made, prove to have been overpaid; and

(b) to pay interest on any such sum as is mentioned in sub-paragraph (a) at the rate specified in section 17 of the Judgments Act 1838 on the date payment was made and for the period beginning with the date of payment and ending with the date of repayment.

(5) In any proceedings before the court, the court may order costs to be decided by detailed assessment.

Procedure where detailed assessment required

122

(1) Before making a detailed assessment of the costs of any person employed in SMCL administration proceedings by the SMCL administrator, the costs officer must require a certificate of employment, which must be endorsed on the bill and authenticated by the SMCL administrator.

(2) The certificate must include—

(a) the name and address of the person employed;

(b) details of the functions to be carried out under the employment; and

(3) Every person whose costs in SMCL administration proceedings are required to be decided by detailed assessment must, on being required in writing to do so by the SMCL administrator, commence detailed assessment proceedings in accordance with CPR Part 47.

(4) If that person does not commence detailed assessment proceedings within three months of being required to do so under paragraph (3), or within such further time as the court, on application, may permit, the SMCL administrator may deal with the assets of the SMCL without regard to any claim for costs by that person, whose claim is forfeited by such failure to commence proceedings.

(5) Where in any such case such a claim for costs lies additionally against an SMCL administrator in the SMCL administrator’s personal capacity, that claim is also forfeited by such failure to commence proceedings.

Costs paid otherwise than out of the assets of the SMCL

123

Where the amount of costs is decided by detailed assessment under an order of the court directing that the costs are to be paid otherwise than out of the assets of the SMCL, the costs officer must note on the final costs certificate by whom, or the manner in which, the costs are to be paid.

Award of costs against SMCL administrator

124

Without prejudice to any provision of the 1986 Act or these Rules by virtue of which the SMCL administrator is not in any event to be liable for costs and expenses, where an SMCL administrator is made a party to any proceedings on the application of another party to the proceedings, the SMCL administrator is not to be personally liable for the costs unless the court otherwise directs.

Application for costs

125

(1) This Rule applies where a party to, or person affected by, SMCL administration proceedings—

(a) applies to the court for an order allowing their costs, or part of them, of or incidental to the proceedings; and

(b) that application is not made at the time of the proceedings.

(2) The applicant must serve a sealed copy of the application on the SMCL administrator.

(3) The SMCL administrator may appear on the application.

(4) No costs of or incidental to the application are to be allowed to the applicant unless the court is satisfied that the application could not have been made at the time of the proceedings.

Costs and expenses of witnesses

126

(1) An officer of the SMCL to which the SMCL administration proceedings relate is not to receive an allowance as a witness in an examination or other proceedings before the court except as directed by the court.

(2) A person making any application in SMCL administration proceedings is not to receive an allowance as a witness for attending the hearing of the application, but the costs officer may allow that person’s expenses of travelling and subsistence.

Final costs certificate

127

(1) A final costs certificate of the costs officer is final and conclusive as to all matters which have not been objected to in the manner provided for under the CPR.

(2) Where it is proved to the satisfaction of a costs officer that a final costs certificate has been lost or destroyed, the costs officer may issue a duplicate.

CHAPTER 5 — Persons who lack capacity to manage their affairs

Introductory

128

(1) The Rules in this Chapter apply where it appears to the court in SMCL administration proceedings that a person affected by the proceedings is unable to manage and administer that person’s own property and affairs by reason of—

(a) lacking capacity within the meaning of the Mental Capacity Act 2005[^f00045];

(b) suffering from a physical affliction; or

(2) Such a person is referred to in this Chapter as “the incapacitated person”.

Appointment of another person to act

129

(1) The court may appoint such person as it thinks just to appear for, represent or act for the incapacitated person.

(2) The appointment may be made either generally or for the purpose of a particular application or proceeding, or for the exercise of particular rights or powers which the incapacitated person might have exercised but for the incapacitated person’s incapacity.

(3) The court may make the appointment either of its own motion or on application by—

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

(b) any person who appears to the court to be a suitable person to make the application; or

(4) An application under paragraph (3) may be made without notice to any other party; but the court may require such notice of the application as it thinks necessary to be delivered to the person alleged to be incapacitated, or any other person, and may adjourn the hearing of the application to enable the notice to be delivered.

Witness statement in support of application

130

An application under Rule 129(3) must be supported by a witness statement made by a registered medical practitioner as to the mental or physical condition of the incapacitated person.

Service of notices following appointment

131

Any notice served on, or sent to, a person appointed under Rule 129 has the same effect as if it had been served on, or sent to, the incapacitated person.

CHAPTER 6 — Appeals in SMCL administration proceedings

Appeals and reviews of SMCL administration orders

132

(1) A court which has jurisdiction in relation to SMCL administration proceedings may review, rescind or vary any order made by it in the exercise of that jurisdiction.

(2) An appeal made in the exercise of the court’s jurisdiction in relation to SMCL administration proceedings lies —

(a) from a decision of an Insolvency and Companies Court Judge or district judge of the High Court, to a High Court Judge; and

(b) from a decision of a High Court Judge, to the Civil Division of the Court of Appeal.

(3) In this Rule, “Civil Division of the Court of Appeal” means the division of the Court of Appeal established by section 3(1) of the Senior Courts Act 1981[^f00046].

Procedure on appeal

133

(1) An appeal against a decision at first instance may only be brought with either the permission of the court which made the decision or the permission of the court which has jurisdiction to hear the appeal.

(2) An appellant must file an appellant’s notice (within the meaning of CPR Part 52[^f00047]) within 21 days after the date of the decision of the court that the appellant wishes to appeal.

(3) The procedure set out in CPR Part 52 applies to any appeal to which this Chapter applies.

CHAPTER 7 — General

Principal court rules and practice to apply

134

(1) The provisions of the CPR (including any related practice directions) apply to SMCL administration proceedings with any necessary modifications, except so far as disapplied by or inconsistent with these Rules.

(2) SMCL administration proceedings must be allocated to the multi-track, for which CPR Part 29[^f00048] makes provision, and accordingly those provisions of the CPR which provide for directions questionnaires and track allocation do not apply.

(3) CPR Part 32 (evidence) applies to a false statement in a document verified by a statement of truth made under these Rules as it applies to a false statement in a document verified by a statement of truth made under CPR Part 22 (statements of truth).

Performance of functions by the Court

135

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