Tribunals, Courts and Enforcement Bill [HL]

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Session 2006 - 07
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Tribunals, Courts and Enforcement Bill [HL]

Tribunals, Courts and Enforcement Bill [HL]
Schedule 17 — Part 7A of the Insolvency Act 1986
265

(3)
If on the effective date a creditor to whom a specified qualifying debt
is owed has any such petition, action or other proceeding as
mentioned in subsection (2)(b) pending in any court, the court may—
(a)
stay the proceedings on the petition, action or other
proceedings (as the case may be), or
5
(b)
allow them to continue on such terms as the court thinks fit.
(4)
In subsection (2)(a) and (b) references to the debt include a reference
to any interest, penalty or other sum that becomes payable in relation
to that debt after the application date.
(5)
Nothing in this section affects the right of a secured creditor of the
10
debtor to enforce his security.
251H
The moratorium period
(1)
The moratorium relating to the qualifying debts specified in a debt
relief order continues for the period of one year beginning with the
effective date for the order, unless—
15
(a)
the moratorium terminates early; or
(b)
the moratorium period is extended by the official receiver
under this section or by the court under section 251M.
(2)
The official receiver may only extend the moratorium period for the
purpose of—
20
(a)
carrying out or completing an investigation under section
251K;
(b)
taking any action he considers necessary (whether as a result
of an investigation or otherwise) in relation to the order; or
(c)
in a case where he has decided to revoke the order, providing
25
the debtor with the opportunity to make arrangements for
making payments towards his debts.
(3)
The official receiver may not extend the moratorium period for the
purpose mentioned in subsection (2)(a) without the permission of
the court.
30
(4)
The official receiver may not extend the moratorium period beyond
the end of the period of three months beginning after the end of the
initial period of one year mentioned in subsection (1).
(5)
The moratorium period may be extended more than once, but any
extension (whether by the official receiver or by the court) must be
35
made before the moratorium would otherwise end.
(6)
References in this Part to a moratorium terminating early are to its
terminating before the end of what would otherwise be the
moratorium period, whether on the revocation of the order or by
virtue of any other enactment.
40
251I
Discharge from qualifying debts
(1)
Subject as follows, at the end of the moratorium applicable to a debt
relief order the debtor is discharged from all the qualifying debts
specified in the order (including all interest, penalties and other
sums which may have become payable in relation to those debts
45
since the application date).

Tribunals, Courts and Enforcement Bill [HL]
Schedule 17 — Part 7A of the Insolvency Act 1986
266

(2)
Subsection (1) does not apply if the moratorium terminates early.
(3)
Subsection (1) does not apply in relation to any qualifying debt
which the debtor incurred in respect of any fraud or fraudulent
breach of trust to which the debtor was a party.
(4)
The discharge of the debtor under subsection (1) does not release any
5
other person from—
(a)
any liability (whether as partner or co-trustee of the debtor or
otherwise) from which the debtor is released by the
discharge; or
(b)
any liability as surety for the debtor or as a person in the
10
nature of such a surety.
(5)
If the order is revoked by the court under section 251M after the end
of the moratorium period, the qualifying debts specified in the order
shall (so far as practicable) be treated as though subsection (1) had
never applied to them.
15
Duties of debtor
251J
Providing assistance to official receiver etc
(1)
The duties in this section apply to a debtor at any time after the
making of an application by him for a debt relief order.
(2)
The debtor must—
20
(a)
give to the official receiver such information as to his affairs,
(b)
attend on the official receiver at such times, and
(c)
do all such other things,

as the official receiver may reasonably require for the purpose of
carrying out his functions in relation to the application or, as the case
25
may be, the debt relief order made as a result of the application.
(3)
The debtor must notify the official receiver as soon as reasonably
practicable if he becomes aware of—
(a)
any error in, or omission from, the information supplied to
the official receiver in, or in support of, the application;
30
(b)
any change in his circumstances between the application date
and the determination date that would affect (or would have
affected) the determination of the application.
(4)
The duties under subsections (2) and (3) apply after (as well as
before) the determination of the application, for as long as the official
35
receiver is able to exercise functions of the kind mentioned in
subsection (2).
(5)
If a debt relief order is made as a result of the application, the debtor
must notify the official receiver as soon as reasonably practicable if—
(a)
there is an increase in his income during the moratorium
40
period applicable to the order;
(b)
he acquires any property or any property is devolved upon
him during that period;
(c)
he becomes aware of any error in or omission from any
information supplied by him to the official receiver after the
45
determination date.

Tribunals, Courts and Enforcement Bill [HL]
Schedule 17 — Part 7A of the Insolvency Act 1986
267

(6)
A notification under subsection (3) or (5) must give the prescribed
particulars (if any) of the matter being notified.
Objections, investigations and revocation
251K
Objections and investigations
(1)
Any person specified in a debt relief order as a creditor to whom a
5
specified qualifying debt is owed may object to—
(a)
the making of the order;
(b)
the inclusion of the debt in the list of the debtor’s qualifying
debts; or
(c)
the details of the debt specified in the order.
10
(2)
An objection under subsection (1) must be—
(a)
made during the moratorium period relating to the order and
within the prescribed period for objections;
(b)
made to the official receiver in the prescribed manner;
(c)
based on a prescribed ground;
15
(d)
supported by any information and documents as may be
prescribed;

and the prescribed period mentioned in paragraph (a) must not be
less than 28 days after the creditor in question has been notified of
the making of the order.
20
(3)
The official receiver must consider every objection made to him
under this section.
(4)
The official receiver may—
(a)
as part of his consideration of an objection, or
(b)
on his own initiative,
25

carry out an investigation of any matter that appears to the official
receiver to be relevant to the making of any decision mentioned in
subsection (5) in relation to a debt relief order or the debtor.
(5)
The decisions to which an investigation may be directed are—
(a)
whether the order should be revoked or amended under
30
section 251L;
(b)
whether an application should be made to the court under
section 251M; or
(c)
whether any other steps should be taken in relation to the
debtor.
35
(6)
The power to carry out an investigation under this section is
exercisable after (as well as during) the moratorium relating to the
order.
(7)
The official receiver may require any person to give him such
information and assistance as he may reasonably require in
40
connection with an investigation under this section.
(8)
Subject to anything prescribed in the rules as to the procedure to be
followed in carrying out an investigation under this section, an
investigation may be carried out by the official receiver in such
manner as he thinks fit.
45

Tribunals, Courts and Enforcement Bill [HL]
Schedule 17 — Part 7A of the Insolvency Act 1986
268

251L
Power of official receiver to revoke or amend a debt relief order
(1)
The official receiver may revoke or amend a debt relief order during
the applicable moratorium period in the circumstances provided for
by this section.
(2)
The official receiver may revoke the order on the ground that—
5
(a)
any information supplied to him by the debtor—
(i)
in, or in support of, the application, or
(ii)
after the determination date,

was incomplete, incorrect or otherwise misleading;
(b)
the debtor has failed to comply with a duty under section
10
251J;
(c)
a bankruptcy order has been made in relation to the debtor;
or
(d)
the debtor has made a proposal under Part 8 (or has notified
the official receiver of his intention to do so).
15
(3)
The official receiver may revoke the order on the ground that he
should not have been satisfied—
(a)
that the debts specified in the order were qualifying debts of
the debtor as at the application date;
(b)
that the conditions specified in Part 1 of Schedule 4ZA were
20
met;
(c)
that the conditions specified in Part 2 of that Schedule were
met or that any failure to meet such a condition did not
prevent his making the order.
(4)
The official receiver may revoke the order on the ground that either
25
or both of the conditions in paragraphs 7 and 8 of Schedule 4ZA
(monthly surplus income and property) are not met at any time after
the order was made.

For this purpose those paragraphs are to be read as if references to
the determination date were references to the time in question.
30
(5)
Where the official receiver decides to revoke the order, he may
revoke it either—
(a)
with immediate effect, or
(b)
with effect from such date (not more than three months after
the date of the decision) as he may specify.
35
(6)
In considering when the revocation should take effect the official
receiver must consider (in the light of the grounds on which the
decision to revoke was made and all the other circumstances of the
case) whether the debtor ought to be given the opportunity to make
arrangements for making payments towards his debts.
40
(7)
If the order has been revoked with effect from a specified date the
official receiver may, if he thinks it appropriate to do so at any time
before that date, revoke the order with immediate effect.
(8)
The official receiver may amend a debt relief order for the purpose of
correcting an error in or omission from anything specified in the
45
order.

Tribunals, Courts and Enforcement Bill [HL]
Schedule 17 — Part 7A of the Insolvency Act 1986
269

(9)
But subsection (8) does not permit the official receiver to add any
debts that were not specified in the application for the debt relief
order to the list of qualifying debts.
(10)
The rules may make further provision as to the procedure to be
followed by the official receiver in the exercise of his powers under
5
this section.
Role of the court
251M
Powers of court in relation to debt relief orders
(1)
Any person may make an application to the court if he is dissatisfied
by any act, omission or decision of the official receiver in connection
10
with a debt relief order or an application for such an order.
(2)
The official receiver may make an application to the court for
directions or an order in relation to any matter arising in connection
with a debt relief order or an application for such an order.
(3)
The matters referred to in subsection (2) include, among other things,
15
matters relating to the debtor’s compliance with any duty arising
under section 251J.
(4)
An application under this section may, subject to anything in the
rules, be made at any time.
(5)
The court may extend the moratorium period applicable to a debt
20
relief order for the purposes of determining an application under this
section.
(6)
On an application under this section the court may dismiss the
application or do one or more of the following—
(a)
quash the whole or part of any act or decision of the official
25
receiver;
(b)
give the official receiver directions (including a direction that
he reconsider any matter in relation to which his act or
decision has been quashed under paragraph (a));
(c)
make an order for the enforcement of any obligation on the
30
debtor arising by virtue of a duty under section 251J;
(d)
extend the moratorium period applicable to the debt relief
order;
(e)
make an order revoking or amending the debt relief order;
(f)
make an order under section 251N; or
35
(g)
make such other order as the court thinks fit.
(7)
An order under subsection (6)(e) for the revocation of a debt relief
order—
(a)
may be made during the moratorium period applicable to the
debt relief order or at any time after that period has ended;
40
(b)
may be made on the court’s own motion if the court has made
a bankruptcy order in relation to the debtor during that
period;
(c)
may provide for the revocation of the order to take effect on
such terms and at such a time as the court may specify.
45

Tribunals, Courts and Enforcement Bill [HL]
Schedule 17 — Part 7A of the Insolvency Act 1986
270

(8)
An order under subsection (6)(e) for the amendment of a debt relief
order may not add any debts that were not specified in the
application for the debt relief order to the list of qualifying debts.
251N
Inquiry into debtor’s dealings and property
(1)
An order under this section may be made by the court on the
5
application of the official receiver.
(2)
An order under this section is an order summoning any of the
following persons to appear before the court—
(a)
the debtor;
(b)
the debtor’s spouse or former spouse or the debtor’s civil
10
partner or former civil partner;
(c)
any person appearing to the court to be able to give
information or assistance concerning the debtor or his
dealings, affairs and property.
(3)
The court may require a person falling within subsection (2)(c)—
15
(a)
to provide a written account of his dealings with the debtor;
or
(b)
to produce any documents in his possession or under his
control relating to the debtor or to the debtor’s dealings,
affairs or property.
20
(4)
Subsection (5) applies where a person fails without reasonable
excuse to appear before the court when he is summoned to do so by
an order under this section.
(5)
The court may cause a warrant to be issued to a constable or
prescribed officer of the court—
25
(a)
for the arrest of that person, and
(b)
for the seizure of any records or other documents in that
person’s possession.
(6)
The court may authorise a person arrested under such a warrant to
be kept in custody, and anything seized under such a warrant to be
30
held, in accordance with the rules, until that person is brought before
the court under the warrant or until such other time as the court may
order.
Offences
251O
False representations and omissions
35
(1)
A person who makes an application for a debt relief order is guilty of
an offence if he knowingly or recklessly makes any false
representation or omission in making the application or providing
any information or documents to the official receiver in support of
the application.
40
(2)
A person who makes an application for a debt relief order is guilty of
an offence if—
(a)
he intentionally fails to comply with a duty under section
251J(3) in connection with the application; or

Tribunals, Courts and Enforcement Bill [HL]
Schedule 17 — Part 7A of the Insolvency Act 1986
271

(b)
he knowingly or recklessly makes any false representation or
omission in providing any information to the official receiver
in connection with such a duty or otherwise in connection
with the application.
(3)
It is immaterial for the purposes of an offence under subsection (1) or
5
(2) whether or not a debt relief order is made as a result of the
application.
(4)
A person in respect of whom a debt relief order is made is guilty of
an offence if—
(a)
he intentionally fails to comply with a duty under section
10
251J(5) in connection with the order; or
(b)
he knowingly or recklessly makes any false representation or
omission in providing information to the official receiver in
connection with such a duty or otherwise in connection with
the performance by the official receiver of functions in
15
relation to the order.
(5)
It is immaterial for the purposes of an offence under subsection (4)—
(a)
whether the offence is committed during or after the
moratorium period; and
(b)
whether or not the order is revoked after the conduct
20
constituting the offence takes place.
251P
Concealment or falsification of documents
(1)
A person in respect of whom a debt relief order is made is guilty of
an offence if, during the moratorium period in relation to that
order—
25
(a)
he does not provide, at the request of the official receiver, all
his books, papers and other records of which he has
possession or control and which relate to his affairs;
(b)
he prevents the production to the official receiver of any
books, papers or other records relating to his affairs;
30
(c)
he conceals, destroys, mutilates or falsifies, or causes or
permits the concealment, destruction, mutilation or
falsification of, any books, papers or other records relating
his affairs;
(d)
he makes, or causes or permits the making of, any false
35
entries in any book, document or record relating to his affairs;
or
(e)
he disposes of, or alters or makes any omission in, or causes
or permits the disposal, altering or making of any omission
in, any book, document or record relating to his affairs.
40
(2)
A person in respect of whom a debt relief order is made is guilty of
an offence if—
(a)
he did anything falling within paragraphs (c) to (e) of
subsection (1) during the period of 12 months ending with
the application date; or
45
(b)
he did anything falling within paragraphs (b) to (e) of
subsection (1) after that date but before the effective date.