INSOLVENCY, ENGLAND AND WALES Citation and commencement 1 1 These Rules may be cited as the Insolvency (Amendment) Rules 2004. 2 These Rules shall come into force on 1st April 2004 (“the commencement date”). Interpretation 2 1 In these Rules references to the “principal Rules” are to the Insolvency Rules 1986 and a Rule referred to by number alone means the Rule so numbered in the principal Rules. 2 These Rules shall be construed as one with the principal Rules. Transitional provisions 3 1 This Rule applies in any case where before the commencement date— a a winding-up order is made or a resolution for the winding up of the company is passed and the liquidator is entitled to remuneration by virtue of Rule 4.127(6), Rule 4.128(1) or Rule 4.148A(4); or b a bankruptcy order is made and the trustee is entitled to remuneration by virtue of Rule 6.138(6) or Rule 6.139(1). 2 In a case to which this Rule applies the liquidator or, as the case may be, the trustee shall continue to be entitled to remuneration on the basis that— a the amendments made to the principal Rules by these Rules do not apply; and b the amendments made to the Insolvency Regulations 1994 by the Insolvency (Amendment) Regulations 2004 had not been made. Amendment to Rule 2.55 4 In paragraph (4) of Rule 2.55 after the word “bankrupt,” there is inserted the word “or” and for the words “composition or arrangement with his creditors” there is substituted “bankruptcy restrictions order, bankruptcy restrictions undertaking or interim bankruptcy restrictions order”. Amendment to Rule 2.57 5 In paragraph (1)(a) of Rule 2.57 omit the words “, or compounds or arranges with his creditors”. Amendment to Rule 3.21 6 In paragraph (4) of Rule 3.21 after the word “bankrupt,” there is inserted “or a disqualified director,” and for the words “composition or arrangement with his creditors” there is substituted “bankruptcy restrictions order, bankruptcy restrictions undertaking or interim bankruptcy restrictions order”. Amendment to Rule 3.23 7 In paragraph (1)(a) of Rule 3.23 omit the words “, or compounds or arranges with his creditors”. Amendment to Rule 4.7 8 In Rule 4.7— a for paragraph (2) there is substituted— 2 No petition shall be filed unless there is produced on presentation of the petition a receipt for the deposit payable or paragraph (2A) applies. 2A This paragraph applies in any case where the Secretary of State has given written notice to the court that the petitioner has made suitable alternative arrangements for the payment of the deposit to the official receiver and such notice has not been revoked in relation to the petitioner in accordance with paragraph (2B). 2B A notice of the kind referred to in paragraph (2A) may be revoked in relation to the petitioner in whose favour it is given by a further notice in writing to the court stating that the earlier notice is revoked in relation to the petitioner. ; and b in paragraph (4)(b) delete the words “of the administration order or notice of appointment”. Substitution of Rule 4.74 9 For Rule 4.74 there is substituted— Supply of Forms (NO CVL APPLICATION) 4.74 A form of proof shall be sent to any creditor of the company by the liquidator where the creditor so requests. . Amendment to Rule 4.75 10 For Rule 4.75(1) there is substituted— 1 Subject to Rule 4.73(5), the following matters shall be stated in a creditor’s proof of debt— a the creditor’s name and address, and, if a company, its company registration number; b the total amount of his claim (including any Value Added Tax) as at the date on which the company went into liquidation; c whether or not that amount includes outstanding uncapitalised interest; d particulars of how and when the debt was incurred by the company; e particulars of any security held, the date when it was given and the value which the creditor puts upon it; f details of any reservation of title in respect of goods to which the debt refers; and g the name, and address and authority of the person signing the proof (if other than the creditor himself). Amendment to Rule 4.124 11 In paragraph (1) of Rule 4.124 for the words “who have proved their debts” there is substituted “of which he is aware”. Amendment to Rule 4.125 12 In paragraph (1) of Rule 4.125 for the words “who have proved their debts” there is substituted “of which he is aware”. Insertion of new Rule 4.125A 13 After Rule 4.125 there is inserted— Rule as to reporting 4.125A 1 The court may, on the liquidator or official receiver’s application, relieve him of any duty imposed on him by Rule 4.124 or 4.125, or authorise him to carry out the duty in a way other than there required. 2 In considering whether to act under this Rule, the court shall have regard to the cost of carrying out the duty, to the amount of the assets available, and to the extent of the interest of creditors or contributories, or any particular class of them. . Amendment to Rule 4.127 14 For paragraph (6) of Rule 4.127 there is substituted— 6 Where the liquidator is not the official receiver and his remuneration is not fixed as above, the liquidator shall be entitled to remuneration fixed in accordance with the provisions of Rule 4.127A. . Insertion of New Rules 4.127A and 4.127B 15 After Rule 4.127 there is inserted— Liquidator’s entitlement to remuneration where it is not fixed under Rule 4.127 4.127A 1 This Rule applies where the liquidator is not the official receiver and his remuneration is not fixed in accordance with Rule 4.127. 2 The liquidator shall be entitled by way of remuneration for his services as such, to such sum as is arrived at by— a first applying the realisation scale set out in Schedule 6 to the monies received by him from the realisation of the assets of the company (including any Value Added Tax thereon but after deducting any sums paid to secured creditors in respect of their securities and any sums spent out of money received in carrying on the business of the company); and b then by adding to the sum arrived at under sub-paragraph (a) such sum as is arrived at by applying the distribution scale set out in Schedule 6 to the value of assets distributed to creditors of the company (including payments made in respect of preferential debts) and to contributories. Liquidator’s remuneration where he realises assets on behalf of chargeholder 4.127B 1 This Rule applies where the liquidator is not the official receiver and realises assets on behalf of a secured creditor. 2 Where the assets realised for a secured creditor are subject to a charge which when created was a mortgage or a fixed charge, the liquidator shall be entitled to such sum by way of remuneration as is arrived at by applying the realisation scale set out in Schedule 6 to the monies received by him in respect of the assets realised (including any sums received in respect of Value Added Tax thereon but after deducting any sums spent out of money received in carrying on the business of the company). 3 Where the assets realised for a secured creditor are subject to a charge which when created was a floating charge, the liquidator shall be entitled to such sum by way of remuneration as is arrived at by— a first applying the realisation scale set out in Schedule 6 to monies received by him from the realisation of those assets (including any Value Added Tax thereon but ignoring any sums received which are spent in carrying on the business of the company); and b then by adding to the sum arrived at under sub-paragraph (a) such sum as is arrived at by applying the distribution scale set out in Schedule 6 to the value of the assets distributed to the holder of the charge. . Amendment to Rule 4.128 16 Omit Rule 4.128(1). Amendment to Rule 4.138 17 Omit Rule 4.138(2). Amendment to Rule 4.148A 18 For paragraph (4) of Rule 4.148A there is substituted— 4 Where the liquidator’s remuneration is not fixed as above, the liquidator shall be entitled to remuneration calculated in accordance with the provisions of Rule 4.148B. . Insertion of new Rule 4.148B 19 After Rule 4.148A there is inserted— Liquidator’s remuneration in members' voluntary liquidation where it is not fixed under Rule 4.148A 4.148B 1 This Rule applies where the liquidator’s remuneration is not fixed in accordance with Rule 4.148A. 2 The liquidator shall be entitled by way of remuneration for his services as such, to such sum as is arrived at by— a first applying the realisation scale set out in Schedule 6 to the monies received by him from the realisation of the assets of the company (including any Value Added Tax thereon but after deducting any sums paid to secured creditors in respect of their securities and any sums spent out of money received in carrying on the business of the company); and b then by adding to the sum arrived at under sub-paragraph (a) such sum as is arrived at by applying the distribution scale set out in Schedule 6 to the value of assets distributed to creditors of the company (including payments made in respect of preferential debts) and to contributories. . Amendment to Rule 4.159 20 In paragraph (4) of Rule 4.159 after the word “bankrupt” there is inserted “or a disqualified director,” and for the words “composition or arrangement with his creditors” there is substituted “bankruptcy restrictions order, bankruptcy restrictions undertaking or an interim bankruptcy restrictions order”. Amendment to Rule 4.161 21 In paragraph (1)(a) of Rule 4.161 omit the words “or compounds or arranges with his creditors”. Amendment to Rule 4.218 22 In paragraph (1)(c) of Rule 4.218 after the words “under section 414” there are inserted the words “or section 415A”. Amendment to Rule 4.231 23 In Rule 4.231(3) after “4.125(1) (final meeting),” insert “4.125A(2) (rule on reporting),”. Amendment of Rule 5.43 24 In Rule 5.43 at the end there is inserted— 3 A proposal is not approved if those voting against it include more than half in value of the creditors, counting in the latter only those— a who gave notice to the official receiver in accordance with Rule 5.40; b whose votes are not to be left out of account under paragraph (2); and c who are not, to the best of the official receiver’s belief, associates of the debtor. 4 It is for the official receiver to decide whether, under this Rule a person is an associate of the debtor for the purposes of paragraph (3)(c) and in relation to this he is entitled to rely on the information provided by the debtor’s statement of affairs or otherwise in accordance with this Part of the Rules. . Amendment to Rule 5.60 25 In Rule 5.60— a in paragraph (3) after “in writing,” there is inserted “within 28 days of the date of the order,”; and b paragraph (4) is omitted. Amendment to Rule 6.10 26 For paragraph (2) there is substituted— 2 No petition shall be filed unless there is produced on presentation of the petition a receipt for the deposit payable or paragraph (2A) applies. 2A This paragraph applies in any case where the Secretary of State has given written notice to the court that the petitioner has made suitable alternative arrangements for the payment of the deposit to the official receiver and such notice has not been revoked in relation to the petitioner in accordance with paragraph (2B). 2B A notice of the kind referred to in paragraph (2A) may be revoked in relation to the petitioner in whose favour it is given by a further notice in writing to the court stating that the earlier notice is revoked in relation to the petitioner. . Substitution of Rule 6.97 27 For Rule 6.97 there is substituted— Supply of forms 6.97 A form of proof shall be sent to any creditor of the bankrupt by the official receiver or trustee where the creditor so requests. . Amendment to Rule 6.98 28 1 For Rule 6.98(1) there is substituted— 1 Subject to Rule 6.96(4), the following matters shall be stated in a creditor’s proof of debt— a the creditor’s name and address, and, if a company, its company registration number; b the total amount of his claim (including any Value Added Tax) as at the date on which the company went into liquidatioin; c whether or not that amount includes outstanding uncapitalised interest; d particulars of how and when the debt was incurred by the company; e particulars of any security held, the date when it was given and the value which the creditor puts upon it; f details of any reservation of title in respect of goods to which the debt refers; and g the name, and address and authority of the person signing the proof (if other than the creditor himself). 2 In Rule 6.98(3) after “the trustee” insert “the official receiver, acting as receiver and manager”. Amendment to Rule 6.99 29 In Rule 6.99(1) after “the trustee” insert “or the official receiver, acting as receiver and manager”. Amendment to Rule 6.136 30 In paragraph (1) of Rule 6.136 for the words “who have proved their debts” there is substituted “of which he is aware”. Amendment to Rule 6.137 31 In paragraph (1) of Rule 6.137 for the words “who have proved their debts” there is substituted “of which he is aware”. Insertion of new Rule 6.137A 32 After Rule 6.137 there shall be inserted— Rule as to reporting 6.137A 1 The court may, on the trustee or official receiver’s application, relieve him of any duty imposed on him by Rules 6.136 or 6.137, or authorise him to carry out the duty in a way other than there required. 2 In considering whether to act as above, the court shall have regard to the cost of carrying out the duty, to the amount of the funds available in the estate, and to the extent of the interest of creditors or any particular class of them. . Amendment to Rule 6.138 33 For paragraph (6) there is substituted— 6 Where the trustee is not the official receiver and his remuneration is not fixed as above, the trustee shall be entitled to remuneration calculated in accordance with Rule 6.138A. . Insertion of new Rule 6.138A 34 After Rule 6.138 there is inserted— Trustee’s remuneration where it is not fixed in accordance with Rule 6.138 6.138A 1 This Rule applies where the trustee is not the official receiver and his remuneration is not fixed in accordance with Rule 6.138. 2 Subject to paragraph (3), the trustee shall be entitled by way of remuneration for his services as such, to such sum as is arrived at by— a first applying the realisation scale set out in Schedule 6 to the monies received by him from the realisation of the assets of the bankrupt (including any Value Added Tax thereon but after deducting any sums paid to secured creditors in respect of their securities and any sums spent out of money received in carrying on the business of the bankrupt); and b then by adding to the sum arrived at under sub-paragraph (a) such sum as is arrived at by applying the distribution scale set out in Schedule 6 to the value of assets distributed to creditors of the bankrupt (including sums paid in respect of preferential debts). 3 That part of the trustee’s remuneration calculated by reference to the realisation scale shall not exceed such sum as is arrived at by applying the realisation scale to such part of the bankrupt’s assets as are required to pay the items referred to in paragraph (4). 4 The items referred to in paragraph (3) are— a the bankruptcy debts (including any interest payable by virtue of section 328(4)) to the extent required to be paid by these Rules (ignoring those debts paid otherwise than out of the proceeds of the realisation of the bankrupt’s assets or which have been secured to the satisfaction of the court); b the expenses of the bankruptcy other than— i fees or the remuneration of the official receiver; and ii any sums spent out of money received in carrying on the business of the bankrupt; c fees payable by virtue of any order made under section 415; and d the remuneration of the official receiver. . Amendment to Rule 6.139 35 For paragraph (1) there is substituted— 1 Where the trustee (not being the official receiver) realises assets on behalf of a secured creditor, the trustee is entitled to such sum by way of remuneration as is arrived at by applying the realisation scale set out in Schedule 6 to the monies received by him in respect of the assets realised (including any Value Added Tax thereon). . Amendment to Rule 6.146 36 Omit Rule 6.146(2). Amendment to Rule 6.156 37 In paragraph (4) of Rule 6.156 after the word “bankrupt” there is inserted “or a disqualified director,” and for the words “composition or arrangement with his creditors” there is substituted “bankruptcy restrictions order, bankruptcy restrictions undertaking or an interim bankruptcy restrictions order”. Amendment to Rule 6.158 38 In paragraph (1)(a) of Rule 6.158 omit the words “or compounds or arranges with his creditors”. Amendment to Rule 6.213 39 In Rule 6.213— a in paragraph (3) after “require” insert “within 28 days of the order”; and b in paragraph (4) omit the words from “The Secretary of State shall notify” to “has been paid.”. Amendment to Rule 6.214A 40 For Rule 6.214A(4) there is substituted— 4 Where the official receiver receives no objection from either a creditor or a trustee he may file a notice under section 279(2) by sending to the court two copies of Form 6.82. The court shall endorse each copy with the date of filing and shall return one copy to the official receiver. The official receiver shall send a copy of the endorsed form to the bankrupt. . Amendment to Rule 6.224 41 In paragraph (1)(c) of Rule 6.224 after the words “under section 415” there are inserted the words “or 415A”. Insertion of new Rule 6.237CA 42 After Rule 6.237C insert— Vesting of bankrupt’s estate—substituted period. 6.237CA For the purposes of section 283A(2) for the period of three years set out therein there shall be substituted, where the trustee in bankruptcy has sent notice to the bankrupt that he considers— a the continued vesting of the property in the bankrupt’s estate to be of no benefit to creditors; or b the re-vesting to the bankrupt will facilitate a more efficient administration of the bankrupt’s estate, the period of one month from the date of that notice. . Amendment to Rule 6.237D 43 At the end of Rule 6.237D there is inserted— 10 In determining the value of the bankrupt’s interest for the purposes of paragraph (6)(c), the court shall disregard that part of the value of the property in which the bankrupt’s interest subsists which is equal to the value of— a any loans secured by mortgage or other charge against the property; b any other third party interest; and c the reasonable costs of sale. . Amendment to Rule 6A.5 44 In Rule 6A.5 omit “Subject to paragraph (2),”. Amendment to Rule 6A.6— 45 In Rule 6A.6— a in paragraph (1) for sub-paragraph (a) there is substituted— a the name, gender, occupation (if any) and date of birth of the bankrupt, aa the bankrupt’s last known address, ; and b in paragraph (2) for sub-paragraph (a) there is substituted— a the name, gender, occupation (if any) and date of birth of the bankrupt, aa the bankrupt’s last known address, . Amendments to Schedule 4 of the principal Rules 46 In Schedule 4 to the principal Rules for Forms 2.8B, 2.9B, 2.11B, 2.25B, 4.25, 5.7, 5.8, 6.28, 6.37, 6.71, 6.79A, 6.82 and 6.84 there shall be substituted the forms so numbered in the Schedule to these Rules. Insertion of Schedule 6 47 After Schedule 5 there is inserted— SCHEDULE 6 DETERMINATION OF INSOLVENCY OFFICE HOLDER'S REMUNERATION Rules 4.127A, 4.127B,4.148B and 6.138A As regards the determination of the remuneration of trustees and liquidators the realisation and distribution scales are as set out in the table below— The realisation scale i on the first £5000 or fraction thereof 20% ii on the next £5000 or fraction thereof 15% iii on the next £90000 or fraction thereof 10% iv on all further sums realised 5% The distribution scale i on the first £5000 or fraction thereof 10% ii on the next £5000 or fraction thereof 7.5% iii on the next £90000 or fraction thereof 5% iv on all further sums distributed 2.5%. Falconer of Thoroton, C. 3rd March 2004 I concur, on behalf of the Secretary of State, Gerry Sutcliffe, Parliamentary Under-Secretary of State for Employment Relations, Competition and Consumers, Department of Trade and Industry 3rd March 2004