Small Business, Enterprise and Employment Bill (HL Bill 57)

whether the person should have his release must be made by a
qualifying decision procedure.”

44 Omit section 194 (resolutions passed at adjourned meetings).

45 (1) Section 195 (meetings to ascertain wishes of creditors or contributories) is
5amended as follows.

(2) In subsection (1)(b), for the words from “meetings” to the end substitute
“qualifying decision procedures to be instigated or the deemed consent
procedure to be used in accordance with any directions given by the court,
and appoint a person to report the result to the court”.

(3) 10In the heading, for “Meetings” substitute “Court’s powers”.

46 (1) Section 201 (voluntary winding up - dissolution) is amended as follows.

(2) In subsection (1)—

(a) omit “and return”;

(b) after “or” insert “his final account and statement under”.

(3) 15In subsection (2)—

(a) for “and return” substitute “, or the account and statement,”;

(b) after “register” insert “it or”;

(c) for “the return” substitute “the account”.

47 In section 202(3) (early dissolution in England and Wales) after “creditors”
20insert “, other than opted-out creditors,”.

48 In section 204(2) (early dissolution: Scotland) for “meeting or meetings”
substitute “liquidator has been appointed”.

49 (1) Section 205 (compulsory winding up - dissolution) is amended as follows.

(2) For subsection (1)(a) substitute—

“(a) 25a final account and statement sent under section 146(4) (final
account);”.

(3) In subsection (2)—

(a) after “receipt of” insert “the final account and statement or”;

(b) after “register” insert “them or”;

(c) 30omit the second “of the notice”.

50 In section 208(2) (misconduct in course of winding up), for “at any meeting”
substitute “in connection with any qualifying decision procedure or deemed
consent procedure”.

51 (1) Schedule 10 (offences) is amended as follows.

(2) 35For the entries for section 94(4) and (6) substitute—

(3) 5Omit the entry for section 98(6).

(4) In the entry for section 99(3), in column 2, for the words from “attend” to
“meeting” substitute “send statement in prescribed form to creditors”.

(5) After the entry for section 99(3) insert—

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

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
25office-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
30“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
5Act 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
10person 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.

(2) 15In 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) 20in paragraph (b), for “a meeting of” substitute “seeking a decision
from”.

Part 2 Individual insolvency

Introductory

58 25The 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) 30In 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) 35In 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) 5for “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) 10Section 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) 15The 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) 20The decision is to be made by a creditors’ decision procedure.

(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
25procedure”.

(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) 30This 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) 35In 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) 40Section 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
5section 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),
10report 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) 15In 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
20the 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
25approves” 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) 30In subsection (1)(a), for “a creditors’ meeting summoned under” substitute
“a decision of the debtor’s creditors pursuant to”.

(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
35creditors’ 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
40made”.

(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) 5any 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
10relation 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
15approval 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’
20meeting 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 25In 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)
30for “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 35In 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) 40Section 298 (trustee’s vacation of office) is amended as follows.

(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) 5after “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
10the 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) 15must 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) 20Section 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
25to 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) 30in 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) 35the 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—

if any of the bankrupt’s creditors objected to the
40person’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
45office.”

(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
5qualifying 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) 10for 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) 15In 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) 20In 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
25appointment”.

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
30matter”.

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) 35For 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) 40be 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 5In 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)—

(a) for “at any meeting of his creditors” substitute “in connection with
any creditors’ decision procedure or deemed consent procedure”;

(b) 10for “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 15In 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
20it.

Section 130

SCHEDULE 10 Trustees in bankruptcy

Insolvency Act 1986 (c. 45)Insolvency Act 1986 (c. 45)

1 The Insolvency Act 1986 is amended as provided in paragraphs 2 to 11.

2 25In section 286(3) (interim receiver to have powers and duties conferred by
section 287) for “of a receiver and manager under” substitute “given by”.

3 (1) Section 287 (receivership pending appointment of first trustee) is amended
as follows.

(2) For the heading substitute “Powers of interim receiver”.

(3) 30In subsection (1)—

(a) for the words from the beginning to “official receiver” substitute “An
interim receiver appointed under section 286”;

(b) for “bankrupt’s estate” substitute “debtor’s property”.

(4) In subsection (2)—

(a) 35for “the official” substitute “an interim”;

(b) for “bankrupt’s estate” substitute “debtor’s property”;

(c) for “the estate” (in both places) substitute “the property”.

(5) In subsection (3)—

(a) for “The official” substitute “An interim”;

(b) for “of the estate” substitute “of the debtor’s property”;

(c) in paragraph (a), for the words from “any” to the end substitute “the
5debtor’s property,”;

(d) for paragraph (b), substitute—

“(b) is not required to do anything that involves his
incurring expenditure, except in pursuance of
directions given by—

(i) 10the Secretary of State, where the official
receiver is the interim receiver, or

(ii) the court, in any other case,”;

(e) in paragraph (c) for “bankrupt’s” substitute “debtor’s”.

(6) In subsection (4)—

(a) 15for paragraph (a) substitute—

“(a) an interim receiver acting as receiver or manager of
the debtor’s property under this section seizes or
disposes of any property which is not the debtor’s
property, and”;

(b) 20in paragraph (b) for “official receiver” substitute “interim receiver”;

(c) for “official receiver is” substitute “interim receiver is”;

(d) for “bankruptcy” substitute “interim receivership”.

(7) Omit subsection (5).

4 Omit section 291(1) to (3) (bankrupt’s duty to deliver possession of estate to
25official receiver).

5 (1) Section 292 (power to make appointments) is amended as follows.

(2) For the heading substitute “Appointment of trustees: general provision”.

(3) For subsection (1) substitute—

“(1) This section applies to any appointment of a person (other than the
30official receiver) as trustee of a bankrupt’s estate.”

(4) Omit subsection (5).

6 Omit sections 293 to 295 (meeting of creditors to appoint first trustee).

7 In section 296 (appointment of trustee by Secretary of State)—

(a) in subsection (1) omit “(other than section 297(1) below)”;

(b) 35in subsection (3) omit “or on a reference under section 295”.

8 Omit section 297.

9 (1) Section 298 (removal of trustees) is amended as follows.

(2) Omit subsection (2).

(3) In subsection (4)—

(a) 40for “section 293(3) or 295(4)” substitute “section 291A(1)”;

(b) for “section 297(5)” substitute “section 291A(2)”.