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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

70

 

(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—

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(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;

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(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

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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

71

 

(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—

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(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;

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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—

 
 

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

72

 

(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—

15

(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

40

(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

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(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.

40

(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

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(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.

5

(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

99      

Enforcement restriction orders

(1)   

After Part 6 of the County Courts Act 1984 (c. 28) (administration orders)

insert—

“Part 6A

Enforcement Restriction Orders

15

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).

40

 
 

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

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(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;

 
 

 
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