Session 2014 - 15
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:                                             

90

 

, continued

 
 

      (5)  

After the entry for section 99(3) insert—

 

“100(9)

Directors failing to

1. On

A fine

  
  

seek creditors’

indictment


  
  

agreement to


   
  

appointment of

    
  

liquidator

2. Summary

In England and

       

 
    

Wales, a fine.

  
   


In Scotland, a fine

       ”

 
    

not exceeding the

  
    

statutory

  
    

maximum.

  
 

      (6)  

For the entries for section 106(4) and (6) substitute—

 

“106(5)

Liquidator failing to

Summary

Level 3 on

  
  

send to company

 

the standard

  
  

members and creditors

 

scale

  
  

a copy of account of

    
  

winding up

    
 

106(6)

Liquidator failing to

Summary

Level 3 on

One tenth of

 
  

send to registrar a copy

 

the standard

level 3 on the

 
  

of account of winding

 

scale

standard

 
  

up

  

scale ”

 
 

Other provision

 

52  (1)  

Section 246A (remote attendance at meetings) is amended as follows.

 

      (2)  

In subsection (1), for the words from “applies to” to the end substitute “applies

 

to any meeting of the members of a company summoned by the office-holder

 

under this Act or the rules, other than a meeting of the members of the

 

company in a members’ voluntary winding up.”

 

      (3)  

In subsection (8) for “creditors, members or contributories” substitute

 

“members”.

 

      (4)  

In subsection (9)(c), for the words from “made” to “of members,” substitute

 

“made”.

 

53         

In section 387(2A) (definition of “relevant date”) for “meetings to consider”

 

substitute “consideration of”.

 

54         

In section 433(3)(a) (admissibility of evidence in statement of affairs etc) omit

 

“98(6),”.

 

55  (1)  

Section 434B (representation of companies at meetings) is amended as

 

follows.

 

      (2)  

In subsection (1), for paragraph (a) substitute—

 

“(a)    

in a qualifying decision procedure, held in pursuance of this

 

Act or of rules made under it, by which a decision is sought

 

from the creditors of a company, or”.

 

      (3)  

In the heading, after “corporations” insert “in decision procedures and”.

 

56         

In Schedule 8, after paragraph 9 insert—

 

“9A      

Provision about how a company’s creditors may nominate a person

 

to be liquidator, including in the case of a voluntary winding up

 

provision conferring functions on the directors of the company.”

 

57  (1)  

Paragraph 10 of Schedule 8 (power to make provision about creditors

 

committees etc) is amended as follows.


 
 

:                                             

91

 

, continued

 
 

      (2)  

In sub-paragraph (1)—

 

(a)    

after “to the” insert “establishment,”;

 

(b)    

for “established under” substitute “provided for by”.

 

      (3)  

In sub-paragraph (2)—

 

(a)    

in paragraph (a), omit “a meeting of” in both places;

 

(b)    

in paragraph (b), for “a meeting of” substitute “seeking a decision

 

from”.

 

Part 2

 

Individual insolvency

 

Introductory

 

58         

The Insolvency Act 1986 is amended in accordance with this Part of this

 

Schedule.

 

Individual voluntary arrangements

 

59  (1)  

Section 256 (nominee’s report on debtor’s proposal) is amended as follows.

 

      (2)  

At the end of subsection (1)(a) insert “and”.

 

      (3)  

In subsection (1)(aa)—

 

(a)    

for “a meeting of the debtor’s creditors should be summoned to”

 

substitute “the debtor’s creditors should”;

 

(b)    

omit “, and”.

 

      (4)  

Omit subsection (1)(b).

 

      (5)  

In subsection (5) for “a meeting of the debtor’s creditors should be summoned

 

to” substitute “the debtor’s creditors should”.

 

      (6)  

In subsection (6), for “a meeting of the debtor’s creditors to be summoned”

 

substitute “the debtor’s creditors”.

 

60  (1)  

Section 256A (nominee’s report on debtor’s proposal) is amended as follows.

 

      (2)  

At the end of subsection (3)(a) insert “and”.

 

      (3)  

In subsection (3)(b)—

 

(a)    

for “a meeting of the debtor’s creditors should be summoned to”

 

substitute “the debtor’s creditors should”;

 

(b)    

omit “, and”.

 

      (4)  

Omit subsection (3)(c).

 

61         

In the heading before section 257, for “meeting” substitute “decisions”.

 

62  (1)  

Section 257 (summoning of creditors’ meeting) is amended as follows.

 

      (2)  

For subsections (1) and (2) substitute—

 

“(1)    

This section applies where it has been reported to the court under

 

section 256 or to the debtor’s creditors under section 256A that the

 

debtor’s creditors should consider the debtor’s proposal.

 

(2)    

The nominee (or the nominee’s replacement under section 256(3) or

 

256A(4)) must seek a decision from the debtor’s creditors as to

 

whether they approve the proposed voluntary arrangement (unless, in

 

the case of a report to which section 256 applies, the court otherwise

 

directs).

 

(2A)    

The decision is to be made by a creditors’ decision procedure.


 
 

:                                             

92

 

, continued

 
 

(2B)    

Notice of the creditors’ decision procedure must be given to every

 

creditor of the debtor of whose claim and address the nominee (or the

 

nominee’s replacement) is aware.”

 

      (3)  

In subsection (3)(b), for “meeting” substitute “creditors’ decision procedure”.

 

      (4)  

For the heading substitute “Consideration of debtor’s proposal by creditors”.

 

63  (1)  

Section 258 (decision of creditors’ meeting) is amended as follows.

 

      (2)  

For subsection (1) substitute—

 

“(1)    

This section applies where under section 257 the debtor’s creditors are

 

asked to decide whether to approve the proposed voluntary

 

arrangement.”

 

      (3)  

In subsections (2), (4) and (5) for “meeting” (in each place) substitute

 

“creditors”.

 

      (4)  

In subsection (2)—

 

(a)    

after “with” insert “or without”;

 

(b)    

for “do so” insert “approve it with modifications”.

 

      (5)  

Omit subsection (6).

 

      (6)  

For the heading substitute “Approval of debtor’s proposal”.

 

64  (1)  

Section 259 (report of decisions to court) is amended as follows.

 

      (2)  

For subsection (1) substitute—

 

“(1)    

When pursuant to section 257 the debtor’s creditors have decided

 

whether to approve the debtor’s proposal (with or without

 

modifications), the nominee (or the nominee’s replacement under

 

section 256(3) or 256A(4)) must—

 

(a)    

give notice of the creditors’ decision to such persons as may

 

be prescribed, and

 

(b)    

where the creditors considered the debtor’s proposal pursuant

 

to a report to the court under section 256(1)(aa), report the

 

creditors’ decision to the court.”

 

      (3)  

In subsection (2), for “meeting has” substitute “creditors have”.

 

65  (1)  

Section 260 (effect of approval) is amended as follows.

 

      (2)  

In subsection (1) for “the meeting summoned under section 257 approves”

 

substitute “pursuant to section 257 the debtor’s creditors decide to approve”.

 

      (3)  

In subsection (2)—

 

(a)    

in paragraph (a) for “at the meeting” substitute “at the time the

 

creditors decided to approve the proposal”;

 

(b)    

in paragraph (b)(i) for the words from “at the” to “it)” substitute “in

 

the creditors’ decision procedure by which the decision to approve the

 

proposal was made”.

 

      (4)  

In subsection (4) for “meeting” substitute “decision”.

 

66  (1)  

Section 261 (additional effect on undischarged bankrupt) is amended as

 

follows.

 

      (2)  

In subsection (1)(a), for “the creditors’ meeting summoned under section 257

 

approves” substitute “pursuant to section 257 the debtor’s creditors decide to

 

approve”.

 

      (3)  

In subsection (3)(a), for “decision of the creditors’ meeting” substitute

 

“creditors’ decision”.

 

67  (1)  

Section 262 (challenge of meeting’s decision) is amended as follows.

 

      (2)  

In subsection (1)(a), for “a creditors’ meeting summoned under” substitute “a

 

decision of the debtor’s creditors pursuant to”.


 
 

:                                             

93

 

, continued

 
 

      (3)  

In subsection (1)(b), for “at or in relation to such a meeting” substitute “in

 

relation to a creditors’ decision procedure instigated under that section”.

 

      (4)  

In subsection (2)(b)(i), for “at the creditors’ meeting” substitute “in the

 

creditors’ decision procedure”.

 

      (5)  

In subsection (3)(b)—

 

(a)    

for “creditors’ meeting” substitute “creditors’ decision procedure”;

 

(b)    

for “the meeting had taken place” substitute “a decision as to whether

 

to approve the proposed voluntary arrangement had been made”.

 

      (6)  

In subsection (4)(a) for “the meeting” substitute “a decision of the debtor’s

 

creditors”.

 

      (7)  

For subsection (4)(b) substitute—

 

“(b)    

direct any person to seek a decision from the debtor’s

 

creditors (using a creditors’ decision procedure) as to whether

 

they approve—

 

(i)    

any revised proposal the debtor may make, or

 

(ii)    

in a case falling within subsection (1)(b), the debtor’s

 

original proposal.”

 

      (8)  

In subsection (5)—

 

(a)    

for “for the summoning of a meeting to consider” substitute “in

 

relation to”;

 

(b)    

for “given at the previous meeting” substitute “previously given by the

 

debtor’s creditors”.

 

      (9)  

In subsection (7), for “meeting”, in each place, substitute “decision”.

 

    (10)  

In subsection (8), for the words from “an approval” to the end substitute “the

 

approval of a voluntary arrangement by a decision of the debtor’s creditors

 

pursuant to section 257 is not invalidated by any irregularity in relation to the

 

creditors’ decision procedure by which the decision was made.”

 

    (11)  

In the heading for “meeting’s” substitute “creditors’”.

 

68         

In section 262B(1) (prosecution of delinquent debtors), for “creditors’ meeting

 

summoned under” substitute “decision of the debtor’s creditors pursuant to”.

 

69         

In section 262C (arrangements coming to an end prematurely), for “creditors’

 

meeting summoned under” substitute “decision of the debtor’s creditors

 

pursuant to”.

 

70         

In section 263(1) (implementation and supervision of approved voluntary

 

arrangement), for “creditors’ meeting summoned under” substitute “decision

 

of the debtor’s creditors pursuant to”.

 

Bankruptcy

 

71         

In section 276(1)(b)(ii) (default in connection with voluntary arrangement) for

 

“at or in connection with a meeting summoned” substitute “in connection with

 

a creditors’ decision procedure instigated”.

 

72         

In section 283(4)(a) (definition of bankrupt’s estate), for the words from “a

 

meeting” to “held” substitute “the trustee of that estate has vacated office under

 

section 298(8)”.

 

73         

In section 287(3)(c) (powers of interim receiver), for “summon a general

 

meeting of” substitute “seek a decision on a matter from”.

 

74         

In section 296(5) (trustee to give notice relating to creditors’ committees), for

 

paragraphs (a) and (b) substitute “explain the procedure for establishing a

 

creditors’ committee under section 301.”

 

75  (1)  

Section 298 (trustee’s vacation of office) is amended as follows.


 
 

:                                             

94

 

, continued

 
 

      (2)  

In subsection (1), for “general meeting of the bankrupt’s creditors summoned”

 

substitute “decision of the bankrupt’s creditors made by a creditors’ decision

 

procedure instigated”.

 

      (3)  

In subsection (4)—

 

(a)    

for “general meeting of the bankrupt’s creditors shall be summoned”

 

substitute “creditors’ decision procedure may be instigated”;

 

(b)    

in paragraph (c)—

 

(i)    

omit “the meeting is requested by”;

 

(ii)    

after “bankrupt’s creditors” insert “so requests,”.

 

      (4)  

After subsection (4) insert—

 

“(4A)    

Where a bankrupt’s creditors are asked to decide whether a trustee

 

other than the official receiver should be removed they must also be

 

asked to decide (using a creditors’ decision procedure) whether, if the

 

trustee is removed, he shall have his release.”

 

      (5)  

In subsection (8), for the words from “a final” to the end substitute “the trustee

 

has given notice under section 331(2).”

 

      (6)  

After subsection (8) insert—

 

“(8A)    

A notice under subsection (8)—

 

(a)    

must not be given before the end of the period prescribed by

 

the rules as the period within which the creditors may object

 

to the trustee’s release, and

 

(b)    

must state whether any of the bankrupt’s creditors objected to

 

the trustee’s release.”

 

76  (1)  

Section 299 (release of trustee) is amended as follows.

 

      (2)  

In subsection (1)(a), omit “a general meeting of”.

 

      (3)  

In subsection (3), for paragraphs (a) and (b) substitute—

 

“(a)    

in the following cases, the time at which notice is given to the

 

court in accordance with the rules that the person has ceased

 

to hold office—

 

(i)    

the person has been removed from office by a

 

decision of the bankrupt’s creditors and the creditors

 

have not decided against his release,

 

(ii)    

the person has died;

 

(b)    

in the following cases, such time as the Secretary of State

 

may, on an application by the person, determine—

 

(i)    

the person has been removed from office by a

 

decision of the bankrupt’s creditors and the creditors

 

have decided against his release,

 

(ii)    

the person has been removed from office by the court

 

or by the Secretary of State,

 

(iii)    

the person has vacated office under section 298(6);”.

 

      (4)  

In subsection (3)(d), for paragraphs (i) and (ii) substitute—

 

“(i)    

if any of the bankrupt’s creditors objected to the

 

person’s release before the end of the period for so

 

objecting prescribed by the rules, such time as the

 

Secretary of State may, on an application by that

 

person, determine, and

 

(ii)    

otherwise, the time at which the person vacated

 

office.”


 
 

:                                             

95

 

, continued

 
 

      (5)  

After subsection (3) insert—

 

“(3A)    

Where the person is removed from office by a decision of the

 

bankrupt’s creditors, any decision of the bankrupt’s creditors as to

 

whether the person should have his release must be made by a

 

qualifying decision procedure.”

 

77  (1)  

Section 300 (vacancy in office of trustee) is amended as follows.

 

      (2)  

In subsection (3)—

 

(a)    

for “summon a general meeting of” substitute “in accordance with the

 

rules seek a nomination from”;

 

(b)    

for the words from “shall” to the end substitute “must seek a

 

nomination if requested to do so by not less than one-tenth in value of

 

the bankrupt’s creditors.”

 

      (3)  

After subsection (3) insert—

 

“(3A)    

The person (if any) nominated by the creditors is to be the trustee.”

 

      (4)  

In subsection (4) for the words from “summoned” to “meeting of” substitute

 

“sought, and is not proposing to seek, a nomination from the bankrupt’s”.

 

      (5)  

In subsection (8) for the words from “holding” to “331” substitute “vacation of

 

office by the trustee under section 298(8)”.

 

78  (1)  

Section 301 (creditors’ committees) is amended as follows.

 

      (2)  

In subsection (1), for the words from “general” to “otherwise)” substitute

 

“bankrupt’s creditors”.

 

      (3)  

In subsection (2)—

 

(a)    

for “A general meeting of the” substitute “The”;

 

(b)    

for “an appointment made by that meeting” substitute “the

 

appointment”.

 

79         

In section 314(7) (trustee’s power and duty to summon creditors’ meeting)—

 

(a)    

for “summon a general meeting of” substitute “seek a decision on a

 

matter from”;

 

(b)    

for “summon such a meeting” substitute “seek a decision on a matter”.

 

80         

In section 330 (final distribution), after subsection (1) insert—

 

“(1A)    

A notice under subsection (1)(b) need not be given to opted-out

 

creditors.”

 

81  (1)  

Section 331 (final meeting) is amended as follows.

 

      (2)  

For subsection (2) substitute—

 

“(2)    

The trustee must give the bankrupt’s creditors (other than opted-out

 

creditors) notice that it appears to the trustee that the administration of

 

the bankrupt’s estate is for practical purposes complete.

 

(2A)    

The notice must—

 

(a)    

be accompanied by a report of the trustee’s administration of

 

the bankrupt’s estate;

 

(b)    

explain the effect of section 299(3)(d) and how the creditors

 

may object to the trustee’s release.”

 

      (3)  

Omit subsections (3) and (4).

 

      (4)  

In the heading, for “meeting” substitute “report”.

 

82         

In section 332(2) (bankrupt’s home), for “summon a meeting under section

 

331” substitute “give notice under section 331(2)”.

 

83         

In section 356(2)(c) (offence of making false statements)—


 
 

:                                             

96

 

, continued

 
 

(a)    

for “at any meeting of his creditors” substitute “in connection with any

 

creditors’ decision procedure or deemed consent procedure”;

 

(b)    

for “at such a meeting” substitute “in connection with such a

 

procedure”.

 

84         

In Schedule 9, after paragraph 12 insert—

 

“12A      

Provision about how a bankrupt’s creditors may nominate a person

 

to be trustee.”

 

85         

In paragraph 13 of Schedule 9 (creditors’ committee)—

 

(a)    

after “to the” insert “establishment,”;

 

(b)    

for “established under” substitute “provided for by”.

 

Other provision

 

86         

Omit section 379A (remote attendance at meetings) and the heading before it.”

 

Bill, as amended, to be reported.


 
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