Tribunals, Courts and Enforcement Bill [HL]

House of Commons

Session 2006 - 07
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Other Bills before Parliament

Tribunals, Courts and Enforcement Bill [HL]

Tribunals, Courts and Enforcement Bill [HL]
Part 5 — Debt management and relief
Chapter 1 — Administration orders
69

Effects of order
112L
Effect on other debt management arrangements
(1)
This section applies if—
(a)
an administration order is made, and
(b)
immediately before the order is made, other debt management
5
arrangements are in force in respect of the debtor.
(2)
The other debt management arrangements cease to be in force when the
administration order is made.
(3)
If the proper county court is aware of the other debt management
arrangements, the court must give the relevant authority notice that the
10
order has been made.
(4)
In a case where the proper county court is aware of other debt
management arrangements at the time it makes the order, it must give
the notice as soon as practicable after making the order.
(5)
In a case where the proper county court becomes aware of those
15
arrangements after it makes the order, it must give the notice as soon as
practicable after becoming aware of them.
(6)
“Other debt management arrangements” means any of the following—
(a)
an enforcement restriction order under Part 6A of this Act;
(b)
a debt relief order under Part 7A of the Insolvency Act 1986;
20
(c)
a debt repayment plan arranged in accordance with a debt
management scheme that is approved under Chapter 4 of Part
5 of the Tribunals, Courts and Enforcement Act 2006.
(7)
“The relevant authority” means—
(a)
in relation to an enforcement restriction order: the proper
25
county court (within the meaning of Part 6A);
(b)
in relation to a debt relief order: the official receiver;
(c)
in relation to a debt repayment plan: the operator of the debt
management scheme in accordance with which the plan is
arranged.
30
(8)
For the purposes of this section a debt relief order is “in force” if the
moratorium applicable to the order under section 251H of the
Insolvency Act 1986 has not yet ended.
112M
Duty to provide information
(1)
This section applies if, and for as long as, an administration order has
35
effect in respect of a debtor.
(2)
The debtor must, at the prescribed times, provide the proper county
court with particulars of his—
(a)
earnings,
(b)
income,
40
(c)
assets, and
(d)
outgoings.
(3)
The debtor must provide particulars of those matters—
(a)
as the matters are at the time the particulars are provided, and

Tribunals, Courts and Enforcement Bill [HL]
Part 5 — Debt management and relief
Chapter 1 — Administration orders
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(b)
as the debtor expects the matters to be at such times in the future
as are prescribed.
(4)
If the debtor intends to dispose of any of his property he must, within
the prescribed period, provide the proper county court with particulars
of the following matters—
5
(a)
the property he intends to dispose of;
(b)
the consideration (if any) he expects will be given for the
disposal;
(c)
such other matters as may be prescribed;
(d)
such other matters as the court may specify.
10
(5)
But subsection (4) does not apply if the disposal is of—
(a)
goods that are exempt goods for the purposes of Schedule 12 to
the Tribunals, Courts and Enforcement Act 2006,
(b)
goods that are protected under any other enactment from being
taken control of under that Schedule, or
15
(c)
prescribed property.
(6)
The duty under subsection (4) to provide the proper county court with
particulars of a proposed disposal of property applies whether the
debtor is the sole owner, or one of several owners, of the property.
(7)
In any provision of this section “prescribed” means prescribed in
20
regulations for the purposes of that provision.
112N
Offence if information not provided
(1)
A person commits an offence if he fails to comply with—
(a)
section 112M(2) and (3), or
(b)
section 112M(4).
25
(2)
A person who commits an offence under subsection (1) may be ordered
by a judge of the proper county court to pay a fine of not more than £250
or to be imprisoned for not more than 14 days.
(3)
Where under subsection (2) a person is ordered to be imprisoned by a
judge of the proper county court, the judge may at any time—
30
(a)
revoke the order, and
(b)
if the person is already in custody, order his discharge.
(4)
Section 129 of the County Courts Act 1984 (c. 28) (enforcement of fines)
applies to payment of a fine imposed under subsection (2).
(5)
For the purposes of section 13 of the Administration of Justice Act 1960
35
(c. 65) (appeal in cases of contempt of court), subsection (2) is to be
treated as an enactment enabling a county court to deal with an offence
under subsection (1) as if it were a contempt of court.
(6)
A district judge or deputy district judge shall have the same powers
under this section as a judge of a county court.
40
112O
Existing county court proceedings to be stayed
(1)
This section applies if these conditions are met—
(a)
an administration order is made;

Tribunals, Courts and Enforcement Bill [HL]
Part 5 — Debt management and relief
Chapter 1 — Administration orders
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(b)
proceedings in a county court (other than bankruptcy
proceedings) are pending against the debtor in respect of a
qualifying debt;
(c)
by virtue of a requirement included in the order by virtue of
section 112G, the creditor under the qualifying debt is not
5
entitled to continue the proceedings in respect of the debt;
(d)
the county court receives notice of the administration order.
(2)
The county court must stay the proceedings.
(3)
The court may allow costs already incurred by the creditor.
(4)
If the court allows such costs, it may on application or of its motion add
10
them—
(a)
to the debt, or
(b)
if the debt is a scheduled debt, to the amount scheduled to the
order in respect of the debt.
(5)
But the court may not add the costs under subsection (4)(b) if the court
15
is under a duty under section 112U(6)(b) to revoke the order because
the total amount of the debtor’s qualifying debts (including the costs)
is more than the prescribed maximum.
112P
Appropriation of money paid
(1)
Money paid into court under an administration order is to be
20
appropriated—
(a)
first in satisfaction of any relevant court fees; and
(b)
then in liquidation of debts.
(2)
Relevant court fees are any fees under an order made under section 92
of the Courts Act 2003 which are payable by the debtor in respect of the
25
administration order.
112Q
Discharge from debts
(1)
If the debtor repays a scheduled debt to the extent provided for by the
administration order, the proper county court must—
(a)
order that the debtor is discharged from the debt, and
30
(b)
de-schedule the debt.
(2)
If the debtor repays all of the scheduled debts to the extent provided for
by the administration order, the proper county court must revoke the
order.
(3)
Subsections (1) and (2) apply to all scheduled debts, including any
35
which, under the administration order, are to be repaid other than to
their full extent.
Variation
112R
Variation
(1)
The proper county court may vary an administration order.
40
(2)
The power under this section is exercisable—
(a)
on the application of the debtor;
(b)
on the application of a qualifying creditor;

Tribunals, Courts and Enforcement Bill [HL]
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Chapter 1 — Administration orders
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(c)
of the court’s own motion.
112S
Variation of duration
(1)
The power under section 112R includes power to vary an
administration order so as to specify a day, or (if a day has already been
specified under section 112K or this subsection) a different day, on
5
which the order will cease to have effect.
(2)
But the new termination day must fall on or before the last day of the
maximum permitted period.
(3)
If the proper county court varies an administration under subsection
(1), the order ceases to have effect on the new termination day.
10
(4)
In this section—
(a)
“new termination day” means the day on which the order will
cease to have effect in accordance with the variation under
subsection (1);
(b)
“maximum permitted period” means the period of five years
15
beginning with the day on which the order was originally
made.
(5)
This section is subject to section 112W (effect of revocation).
112T
De-scheduling debts
(1)
The power under section 112R includes power to vary an
20
administration order by de-scheduling a debt.
(2)
But the debt may be de-scheduled only if it appears to the proper
county court that it is just and equitable to do so.
Revocation
112U
Duty to revoke order
25
(1)
The proper county court must revoke an administration order in either
of these cases—
(a)
where it becomes apparent that, at the time the order was made,
the condition in subsection 112B(2) was not met (debtor in fact
did not have two or more qualifying debts);
30
(b)
where the debtor is no longer a debtor under any qualifying
debts.
(2)
The proper county court must revoke an administration order in either
of these cases—
(a)
where it becomes apparent that, at the time the order was made,
35
the condition in subsection 112B(3) was not met (debtor in fact
had business debt), and he is still a debtor under the business
debt, or any of the business debts, in question;
(b)
where the debtor subsequently becomes a debtor under a
business debt, and he is still a debtor under that debt.
40
(3)
The proper county court must revoke an administration order where it
becomes apparent that, at the time the order was made, the condition
in section 112B(4) was not met (debtor in fact excluded under AO,
voluntary arrangement or bankruptcy exclusion).

Tribunals, Courts and Enforcement Bill [HL]
Part 5 — Debt management and relief
Chapter 1 — Administration orders
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(4)
The proper county court must revoke an administration order where,
after the order is made—
(a)
the debtor becomes excluded under the voluntary arrangement
exclusion, or
(b)
a bankruptcy order is made against the debtor, and is still in
5
force.
(5)
The proper county court must revoke an administration order in either
of these cases—
(a)
where it becomes apparent that, at the time the order was made,
the condition in section 112B(5) was not met (debtor in fact able
10
to pay qualifying debts);
(b)
where the debtor is now able to pay all of his qualifying debts.
(6)
The proper county court must revoke an administration order in either
of these cases—
(a)
where it becomes apparent that, at the time the order was made,
15
the condition in section 112B(6) was not met (debtor’s
qualifying debts in fact more than prescribed maximum);
(b)
where the total amount of the debtor’s qualifying debts is now
more than the prescribed maximum.
(7)
The proper county court must revoke an administration order in either
20
of these cases—
(a)
where it becomes apparent that, at the time the order was made,
the condition in section 112B(7) was not met (debtor’s surplus
income in fact less than, or the same as, the prescribed
minimum);
25
(b)
where the debtor’s surplus income is now less than, or the same
as, the prescribed minimum.
112V
Power to revoke order
(1)
The proper county court may revoke an administration order in any
case where there is no duty under this Part to revoke it.
30
(2)
The power of revocation under this section may, in particular, be
exercised in any of the following cases—
(a)
where the debtor has failed to make two payments (whether
consecutive or not) required by the order;
(b)
where the debtor has failed to provide the proper county court
35
with the particulars required by—
(i)
section 112M(2) and (3), or
(ii)
section 112M(4).
(3)
The power of revocation under this section is exercisable—
(a)
on the application of the debtor;
40
(b)
on the application of a qualifying creditor;
(c)
of the court’s own motion.
112W
Effect of revocation
(1)
This section applies if, under any duty or power in this Part, the proper
county court revokes an administration order.
45

Tribunals, Courts and Enforcement Bill [HL]
Part 5 — Debt management and relief
Chapter 1 — Administration orders
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(2)
The order ceases to have effect in accordance with the terms of the
revocation.
Notification of certain events
112X
Notice when order made, varied, revoked etc
(1)
If a notifiable event occurs in relation to an administration order, the
5
proper county court must send notice of the event to the creditor under
every scheduled debt.
(2)
There is a notifiable event in any of the following cases—
(a)
when the administration order is made;
(b)
when a debt is scheduled to the administration order at any
10
time after the making of the order;
(c)
when the administration order is varied;
(d)
when the administration order is revoked;
(e)
when the proper county court is given notice under any of the
provisions listed in section 112K(7) (effect of enforcement
15
restriction order or debt repayment plan on administration
order).
Total amount of qualifying debts not properly calculated
112Y
Failure to take account of all qualifying debts
(1)
This section applies if—
20
(a)
an administration order has been made, but
(b)
it becomes apparent that the total amount of the debtor’s
qualifying debts was not properly calculated for the purposes of
section 112B(6), because of an undeclared debt.
(2)
A debt is undeclared if it ought to have been, but was not, taken into
25
account in the calculation for the purposes of section 112B(6).
(3)
If these conditions are met—
(a)
the undeclared debt is due (whether it became due before or
after the making of the order);
(b)
the total debt is less than, or the same as, the prescribed
30
maximum;

the proper county court must schedule the undeclared debt to the
order.
(4)
If these conditions are met—
(a)
the undeclared debt is not due;
35
(b)
the total debt is less than, or the same as, the prescribed
maximum;

the proper county court must schedule the undeclared debt to the order
when the debt becomes due.
(5)
If the total debt is more than the prescribed maximum, the proper
40
county court must revoke the administration order (whether or not the
undeclared debt is due).

Tribunals, Courts and Enforcement Bill [HL]
Part 5 — Debt management and relief
Chapter 1 — Administration orders
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(6)
In this section “total debt” means the total amount of the debtor’s
qualifying debts (including the undeclared debt).
(7)
Subsections (3) and (4) are subject to section 112AG(5).
Interpretation
112Z
Introduction
5
Sections 112AA to 112AH apply for the purposes of this Part.
112AA
Main definitions
(1)
In this Part—
“administration order” has the meaning given by section 112A;
“debtor” has the meaning given by section 112B;
10
“prescribed maximum” means the amount prescribed in
regulations for the purposes of section 112B(6);
“prescribed minimum” means the amount prescribed in
regulations for the purposes of section 112B(7);
“qualifying creditor” means a creditor under a qualifying debt.
15
(2)
References to the currency of an administration order are references to
the period which—
(a)
begins when the order first has effect, and
(b)
ends when the order ceases to have effect.
(3)
In relation to an administration order, references to the proper county
20
court are references to the county court that made the order.
(4)
But that is subject to rules of court as to the venue for, and transfer of,
proceedings in county courts.
112AB
Expressions relating to debts
(1)
All debts are qualifying debts, except for the following—
25
(a)
any debt secured against an asset;
(b)
any debt of a description specified in regulations.
(2)
A business debt is any debt (whether or not a qualifying debt) which is
incurred by a person in the course of a business.
(3)
Only debts that have already arisen are included in references to debts;
30
and accordingly such references do not include any debt that will arise
only on the happening of some future contingency.
112AC
  Inability to pay debts
(1)
In a case where an individual is the debtor under a debt that is
repayable by a single payment, the debtor is to be regarded as unable
35
to pay the debt only if—
(a)
the debt has become due;
(b)
the debtor has failed to make the single payment; and
(c)
the debtor is unable to make that payment.
(2)
In a case where an individual is the debtor under a debt that is
40
repayable by a number of payments, the debtor is to be regarded as
unable to pay the debt only if—