PART 6Debtor’s contribution

Payments by debtor following sequestration

96Payment break

1

The trustee may, on the application of the debtor, extend the payment period of a debtor contribution order by granting a payment break.

2

A “payment break” is a period not exceeding 6 months during which payments under the debtor contribution order are deferred.

3

A debtor may apply for a payment break if—

a

there has been a reduction of at least 50% in the debtor’s disposable income (as determined using the common financial tool) as a result of any of the circumstances mentioned in subsection (4) arising in relation to the debtor, and

b

the debtor has not previously applied for a payment break in relation to a debtor contribution order applying after the sequestration of the debtor’s estate.

4

The circumstances are—

a

a period of unemployment or a change in employment,

b

a period of leave from employment because of—

i

the birth or adoption of a child, or

ii

the need to care for a dependant,

c

a period of illness of the debtor,

d

a divorce,

e

a dissolution of civil partnership,

f

a separation from a person to whom the debtor is married or with whom the debtor is in civil partnership, and

g

the death of a person who, along with the debtor, cared for a dependant of the debtor.

5

An application for a payment break must specify the period during which the debtor wishes payments to be deferred.

6

If, in the opinion of the trustee, a payment break is fair and reasonable, the trustee may grant it on such conditions and for such period as the trustee thinks fit.

7

The trustee must notify in writing the grant of a payment break to—

a

the debtor,

b

AiB (if the trustee is not AiB), and

c

any third person required to make a payment under the debtor contribution order.

8

If the trustee decides not to grant a payment break, the trustee must notify the debtor of that decision and of the reasons for that decision.

9

The payment period in a debtor contribution order is deemed to be varied by the addition to the period of any payment break granted under this section.