Tribunals, Courts and Enforcement Bill [HL]

House of Commons

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

Tribunals, Courts and Enforcement Bill [HL]
Part 5 — Debt management and relief
Chapter 1 — Administration orders
76

(a)
the debt has become due;
(b)
the debtor has failed to make one or more of the payments; and
(c)
the debtor is unable to make all of the missed payments.
112AD
  Calculating the debtor’s qualifying debts
(1)
The total amount of a debtor’s qualifying debts is to be calculated in
5
accordance with subsections (2) and (3).
(2)
All of the debtor’s qualifying debts which have arisen before the
calculation must be taken into account (whether or not the debts are
already due at the time of the calculation).
(3)
Regulations must make further provision about how the total amount
10
of a debtor’s qualifying debts is to be calculated.
(4)
Regulations may make provision about how the amount of any
particular qualifying debt is to be calculated.
(5)
That includes the calculation of the amount of a debt for these
purposes—
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(a)
calculating the total amount of the debtor’s qualifying debts;
(b)
scheduling the debt to an administration order.
112AE
  Calculating the debtor’s surplus income
(1)
The debtor’s surplus income is to be calculated in accordance with
regulations.
20
(2)
Regulations under this section must, in particular, make the following
provision—
(a)
provision about what is surplus income;
(b)
provision about the period by reference to which the debtor’s
surplus income is to be calculated.
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(3)
Regulations under this section may, in particular, provide for the
debtor’s assets to be taken account of when calculating his surplus
income.
112AF
  Debts becoming due
(1)
A debt that is repayable by a single payment becomes due when the
30
time for making that payment is reached.
(2)
A debt that is repayable by a number of payments becomes due when
the time for making the first of the payments is reached.
112AG
  Scheduling and de-scheduling debts
(1)
A debt is scheduled to an administration order if the relevant
35
information is included in a schedule to the order.
(2)
A debt is de-scheduled if the relevant information is removed from a
schedule in which it was included as mentioned in subsection (1).
(3)
In relation to a debt, the relevant information is—
(a)
the amount of the debt, and
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(b)
the name of the creditor under the debt.
(4)
A scheduled debt is a debt that is scheduled to an administration order.

Tribunals, Courts and Enforcement Bill [HL]
Part 5 — Debt management and relief
Chapter 1 — Administration orders
77

(5)
The proper county court must not schedule a debt to an administration
order unless the court has had regard to any representations made by
any person about why the debt should not be scheduled.
(6)
But subsection (5) does not apply to any representations which are
made by the debtor in relation to the scheduling of a debt under section
5
112Y.
(7)
The proper county court must not de-schedule a debt unless the court
has had regard to any representations made by any person about why
the debt should not be de-scheduled.
(8)
But subsection (7) does not apply in relation to the de-scheduling of a
10
debt under section 112Q.
(9)
A court must not schedule a debt to an administration order, or de-
schedule a debt, except in accordance with the provisions of this Part.
112AH
  The AO, voluntary arrangement and bankruptcy exclusions
(1)
The debtor is excluded under the AO exclusion if—
15
(a)
an administration order currently has effect in respect of him, or
(b)
an administration order has previously had effect in respect of
him, and the period of 12 months — beginning with the day
when that order ceased to have effect — has yet to finish.
(2)
But in a case that falls within subsection (1)(b), the debtor is not
20
excluded under the AO exclusion if the previous administration
order—
(a)
ceased to have effect in accordance with any of the provisions
listed in section 112K(7) (effect of enforcement restriction order
or debt repayment plan on administration order), or
25
(b)
was revoked in accordance with section 112U(1)(b) (debtor no
longer has any qualifying debts).
(3)
The debtor is excluded under the voluntary arrangement exclusion if—
(a)
an interim order under section 252 of the Insolvency Act 1986
has effect in respect of him (interim order where debtor intends
30
to make proposal for voluntary arrangement), or
(b)
he is bound by a voluntary arrangement approved under Part 8
of the Insolvency Act 1986.
(4)
The debtor is excluded under the bankruptcy exclusion if—
(a)
a petition for a bankruptcy order to be made against him has
35
been presented but not decided, or
(b)
he is an undischarged bankrupt.
Regulations
112AI
  Regulations under this Part
(1)
It is for the Lord Chancellor to make regulations under this Part.
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(2)
Any power to make regulations under this Part is exercisable by
statutory instrument.

Tribunals, Courts and Enforcement Bill [HL]
Part 5 — Debt management and relief
Chapter 2 — Enforcement restriction orders
78

(3)
A statutory instrument containing regulations under this Part is subject
to annulment in pursuance of a resolution of either House of
Parliament.”
(2)
Schedule 16 makes amendments consequential on the substitution of the new
Part 6 in the 1984 Act.
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(3)
This section does not apply to any case in which an administration order was
made, or an application for such an order was made, before the day on which
this section comes into force.
Chapter 2
Enforcement restriction orders
10
102
Enforcement restriction orders
(1)
After Part 6 of the County Courts Act 1984 (c. 28) (administration orders)
insert—
“Part 6A
Enforcement Restriction Orders
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Enforcement restriction orders
117A
Enforcement restriction orders
(1)
An enforcement restriction order is an order that imposes the
requirements specified in sections 117C to 117E on certain creditors.
(2)
An enforcement restriction order may also impose a requirement in
20
accordance with section 117F on the debtor.
117B
Power to make order
(1)
A county court may make an enforcement restriction order if the
conditions in subsections (2) to (8) are met.
(2)
The order must be made in respect of an individual who is a debtor
25
under two or more qualifying debts.
(3)
That individual (“the debtor”) must not be a debtor under any business
debts.
(4)
The debtor must not be excluded under any of the following—
(a)
the ERO exclusion;
30
(b)
the voluntary arrangement exclusion;
(c)
the bankruptcy exclusion.
(5)
The debtor must be unable to pay one or more of his qualifying debts.
(6)
The debtor must be suffering from a sudden and unforeseen
deterioration in his financial circumstances.
35
(7)
There must be a realistic prospect that the debtor’s financial
circumstances will improve within the period of six months beginning
when the order is made.

Tribunals, Courts and Enforcement Bill [HL]
Part 5 — Debt management and relief
Chapter 2 — Enforcement restriction orders
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(8)
It must be fair and equitable to make the order.
(9)
Before making an enforcement restriction order, the county court must
have regard to any representations made by any person about why the
order should not be made.
(10)
Subsection (9) is subject to Civil Procedure Rules.
5
Requirements imposed by order
117C
Presentation of bankruptcy petition
(1)
An enforcement restriction order must, during the currency of the
order, impose the following requirement.
(2)
The requirement is that no qualifying creditor of the debtor is to present
10
a bankruptcy petition against the debtor in respect of a qualifying debt,
unless the creditor has the permission of the proper county court.
(3)
The proper county court may give permission for the purposes of
subsection (2) subject to such conditions as it thinks fit.
117D
Remedies other than bankruptcy
15
(1)
An enforcement restriction order must, during the currency of the
order, impose the following requirement.
(2)
The requirement is that no qualifying creditor of the debtor is to pursue
any remedy for the recovery of a qualifying debt unless—
(a)
regulations under subsection (3) provide otherwise, or
20
(b)
the creditor has the permission of the proper county court.
(3)
Regulations may specify classes of debt which are exempted (or
exempted for specified purposes) from any requirement imposed by
subsection (2).
(4)
The proper county court may give permission for the purposes of
25
subsection (2)(b) subject to such conditions as it thinks fit.
(5)
This section does not have any effect in relation to bankruptcy
proceedings.
117E
Stopping supplies of gas or electricity
(1)
An enforcement restriction order must, during the currency of the
30
order, impose the requirement in subsection (3).
(2)
In relation to that requirement, a domestic utility creditor is any person
who—
(a)
provides the debtor with a supply of mains gas or mains
electricity for the debtor’s own domestic purposes, and
35
(b)
is a creditor under a qualifying debt that relates to the provision
of that supply.
(3)
The requirement is that no domestic utility creditor is to stop the supply
of gas or electricity, or the supply of any associated services, except in
the cases in subsections (4) to (6).
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Tribunals, Courts and Enforcement Bill [HL]
Part 5 — Debt management and relief
Chapter 2 — Enforcement restriction orders
80

(4)
The first case is where the reason for stopping a supply relates to the
non-payment by the debtor of charges incurred in connection with that
supply after the making of the enforcement restriction order.
(5)
The second case is where the reason for stopping a supply is
unconnected with the non-payment by the debtor of any charges
5
incurred in connection with—
(a)
that supply, or
(b)
any other supply of mains gas or mains electricity, or of
associated services, that is provided by the domestic utility
creditor.
10
(6)
The third case is where the proper county court gives permission to
stop a supply.
(7)
The proper county court may give permission for the purposes of
subsection (6) subject to such conditions as it thinks fit.
(8)
A supply of mains gas is a supply of the kind mentioned in section
15
5(1)(b) of the Gas Act 1986 (c. 44).
(9)
A supply of mains electricity is a supply of the kind mentioned in
section 4(1)(c) of the Electricity Act 1989 (c. 29).
117F
Repayment requirement
(1)
An enforcement restriction order may impose a repayment
20
requirement on the debtor.
(2)
The county court may include the requirement in the order at the time
it makes the order.
(3)
The proper county court may, at any time after an enforcement
restriction order has been made, vary the order so as to include a
25
repayment requirement.
(4)
The proper county court may, at any time when an enforcement
restriction order includes a repayment requirement, vary the order so
as to—
(a)
remove the repayment requirement, or
30
(b)
include a different repayment requirement.
(5)
A repayment requirement is a requirement that the debtor make
payments, in respect of one or more of his qualifying debts, to the
person or persons to whom he owes the debt or debts.
(6)
A county court may include a repayment requirement in an order only
35
if—
(a)
the debtor has surplus income at the time of the inclusion of the
requirement, and
(b)
the inclusion of the requirement would be fair and equitable.
(7)
The debtor’s surplus income is to be calculated in accordance with
40
regulations.
(8)
Regulations under subsection (7) must make the following provision—
(a)
provision about what is surplus income;

Tribunals, Courts and Enforcement Bill [HL]
Part 5 — Debt management and relief
Chapter 2 — Enforcement restriction orders
81

(b)
provision about the period by reference to which the debtor’s
surplus income is to be calculated.
(9)
Regulations under subsection (7) may, in particular, provide for the
debtor’s assets to be taken account of for the purpose of calculating his
surplus income.
5
(10)
The proper county court may vary an enforcement restriction order
under this section—
(a)
of its own motion;
(b)
on the application of the debtor;
(c)
on the application of a qualifying creditor.
10
Making an order
117G
Application for order
(1)
A county court may make an enforcement restriction order only on the
application of the debtor.
(2)
The debtor may make an application for an enforcement restriction
15
order whether or not a judgment has been obtained against him in
respect of any of his debts.
117H
Duration
(1)
A county court may, at the time it makes an enforcement restriction
order, specify a day on which the order will cease to have effect.
20
(2)
The court may not specify a day which falls after the last day of the
maximum permitted period.
(3)
If the court specifies a day under this section, the order ceases to have
effect on that day.
(4)
If the court does not specify a day under this section, the order ceases
25
to have effect at the end of the maximum permitted period.
(5)
The maximum permitted period is the period of 12 months beginning
with the day on which the order is made.
(6)
This section is subject to—
(a)
section 112S (variation of duration);
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(b)
section 112W (effect of revocation);
(7)
This section is also subject to the following (effect of administration
order or debt relief order on enforcement restriction order)—
(a)
section 112L of this Act;
(b)
section 251F of the Insolvency Act 1986.
35
Effects of order
117I
Effect on other debt management arrangements
(1)
This section applies if—
(a)
an enforcement restriction order is made, and
(b)
immediately before the order is made, other debt management
40
arrangements are in force in respect of the debtor.

Tribunals, Courts and Enforcement Bill [HL]
Part 5 — Debt management and relief
Chapter 2 — Enforcement restriction orders
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(2)
The other debt management arrangements cease to be in force when the
enforcement restriction 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
order has been made.
5
(4)
In a case where the proper county court is aware of those 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 only becomes aware of those
arrangements after it makes the order, it must give the notice as soon as
10
practicable after becoming aware of them.
(6)
“Other debt management arrangements” means any of the following—
(a)
an administration order under Part 6 of this Act;
(b)
a debt relief order under Part 7A of the Insolvency Act 1986;
(c)
a debt repayment plan arranged in accordance with a debt
15
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 administration order: the proper county court
(within the meaning of Part 6);
20
(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.
(8)
For the purposes of this section a debt relief order is “in force” if the
25
moratorium applicable to the order under section 251H of the
Insolvency Act 1986 has not yet ended.
117J
Duty to provide information
(1)
This section applies if, and for as long as, an enforcement restriction
order has effect in respect of a debtor.
30
(2)
The debtor must, at the prescribed times, provide the proper county
court with particulars of his—
(a)
earnings,
(b)
income,
(c)
assets, and
35
(d)
outgoings.
(3)
The debtor must provide particulars of those matters—
(a)
as the matters are at the time the particulars are provided, and
(b)
as the debtor expects the matters to be at such times in the future
as may be prescribed.
40
(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—
(a)
the property he intends to dispose of;