Proceeds of Crime (Scotland) Act 1995

Section 44.

SCHEDULE 2 Sequestration etc. of Persons Holding Realisable or Forfeitable Property

Sequestration of person holding realisable or forfeitable property

1 (1) Where the estate of a person who holds realisable or forfeitable property is sequestrated—

(a) property, other than heritable property situated in Scotland, for the time being subject to a restraint order made before the date of sequestration (within the meaning of section 12(4) of the 1985 Act) and heritable property situated in Scotland for the time being subject to a restraint order recorded in the General Register of Sasines or, as the case may be, registered in the Land Register of Scotland before such date of sequestration; and

(b) any proceeds of property realised by virtue of paragraph 1 of Schedule 1 to this Act for the time being in the hands of an administrator appointed under that paragraph,

is excluded from the debtor’s estate for the purposes of that Act.

(2) Where an award of sequestration has been made, the powers conferred on the court by sections 28 to 33 and 35 to 38 of and the said Schedule 1 to this Act or on an administrator appointed under paragraph 1 of that Schedule shall not be exercised in relation to—

(a) property comprised in the whole estate of the debtor (within the meaning of section 31(8) of the 1985 Act); or

(b) any income of the debtor which has been ordered, under subsection (2) of section 32 of that Act, to be paid to the permanent trustee or any estate which, under subsection (10) of section 31 of that Act or subsection (6) of the said section 32 of that Act, vests in the permanent trustee,

and it shall not be competent to submit a claim in relation to the confiscation order to the permanent trustee in accordance with section 48 of that Act.

(3) Nothing in the 1985 Act shall be taken as restricting, or enabling the restriction of, the exercise of the powers so conferred.

(4) Where, during the period before sequestration is awarded, an interim trustee stands appointed under section 2(5) of the 1985 Act and any property in the debtor’s estate is subject to a restraint order, the powers conferred on the interim trustee by virtue of that Act do not apply to property for the time being subject to the restraint order.

(5) Where the estate of a person is sequestrated and he has directly or indirectly made a gift caught by Part I of this Act or an implicative gift—

(a) no decree shall, at any time when proceedings as regards an offence to which Part I of this Act applies or, as the case may be, a drug trafficking offence have been instituted against him and have not been concluded or when property of the person to whom the gift was made is subject to a restraint order, be granted under section 34 or 36 of the 1985 Act (gratuitous alienations and unfair preferences) in respect of the making of the gift; and

(b) any decree granted under either of the said sections 34 and 36 after the conclusion of the proceedings shall take into account any realisation under this Act of property held by the person to whom the gift was made.

Bankruptcy in England and Wales of person holding realisable or forfeitable property

2 (1) Where a person who holds realisable or forfeitable property is adjudged bankrupt—

(a) property, other than heritable property situated in Scotland, for the time being subject to a restraint order made before the order adjudging him bankrupt and heritable property situated in Scotland for the time being subject to a restraint order recorded in the General Register of Sasines or, as the case may be, registered in the Land Register of Scotland before the order adjudging him bankrupt was made; and

(b) any proceeds of property realised by virtue of paragraph 1 of Schedule 1 to this Act for the time being in the hands of an administrator appointed under that paragraph,

is excluded from the bankrupt’s estate for the purposes of Part IX of the [1986 c. 45.] Insolvency Act 1986.

(2) Where a person has been adjudged bankrupt, the powers conferred on the court by sections 28 to 33 and 35 to 38 of and the said Schedule 1 to this Act or on an administrator appointed under paragraph 1 of that Schedule shall not be exercised in relation to—

(a) property for the time being comprised in the bankrupt’s estate for the purposes of the said Part IX;

(b) property in respect of which his trustee in bankruptcy may (without leave of the court) serve a notice under section 307, 308 or 308A of the Insolvency Act 1986 (after-acquired property and tools, clothes, etc. exceeding value of reasonable replacement and certain tenancies); and

(c) property which is to be applied for the benefit of creditors of the bankrupt by virtue of a condition imposed under section 280(2)(c) of the Insolvency Act 1986.

(3) Nothing in the Insolvency Act 1986 shall be taken as restricting, or enabling the restriction of, the exercise of the powers so conferred.

(4) Where, in the case of a debtor, an interim receiver stands appointed under section 286 of the Insolvency Act 1986 and any property of the debtor is subject to a restraint order the powers conferred on the receiver by virtue of that Act do not apply to property for the time being subject to the restraint order.

(5) Where a person is adjudged bankrupt and has directly or indirectly made a gift caught by Part I of this Act or an implicative gift—

(a) no order shall, at any time when proceedings for an offence to which Part VI of the [1988 c. 33.] Criminal Justice Act 1988 applies or, as the case may be a drug trafficking offence have been instituted against him and have not been concluded or when property of the person to whom the gift was made is subject to a restraint order, be made under section 339 or 423 of the Insolvency Act 1986 (avoidance of certain transactions) in respect of the making of the gift, and

(b) any order made under either of those sections after the conclusion of the proceedings shall take into account any realisation under this Act of property held by the person to whom the gift was made.

Winding up of company holding realisable or forfeitable property

3 (1) Where realisable or forfeitable property is held by a company and an order for the winding up of the company has been made or a resolution has been passed by the company for the voluntary winding up, the functions of the liquidator (or any provisional liquidator) shall not be exercisable in relation to—

(a) property, other than heritable property situated in Scotland, for the time being subject to a restraint order made before the relevant time and heritable property situated in Scotland for the time being subject to a restraint order recorded in the General Register of Sasines or, as the case may be, registered in the Land Register of Scotland before the relevant time; and

(b) any proceeds of property realised by virtue of paragraph 1 of Schedule 1 to this Act for the time being in the hands of an administrator appointed under that paragraph.

(2) Where, in the case of a company, such an order has been made or such a resolution has been passed, the powers conferred on the court by sections 28 to 33 and 35 to 38 of and the said Schedule 1 to this Act or on an administrator appointed under paragraph 1 of that Schedule shall not be exercised in relation to any realisable or forfeitable property held by the company in relation to which the functions of the liquidator are exercisable—

(a) so as to inhibit the liquidator from exercising those functions for the purpose of distributing any property held by the company to the company’s creditors; or

(b) so as to prevent the payment out of any property of expenses (including the remuneration of the liquidator or any provisional liquidator) properly incurred in the winding up in respect of the property.

(3) Nothing in the Insolvency Act 1986 shall be taken as restricting, or enabling the restriction of, the exercise of the powers so conferred.

(4) For the purposes of the application of Parts IV and V of the [1986 c. 45.] Insolvency Act 1986 (winding up of registered companies and winding up of unregistered companies) to a company which the court has jurisdiction to wind up, a person is not a creditor in so far as any sum due to him by the company is due in respect of a confiscation order (whether under this Act or under and within the meaning of section 2 of the [1994 c. 37.] Drug Trafficking Act 1994 or any corresponding provision in Northern Ireland).

(5) Where an order for the winding up of a company has been made or a resolution has been passed by a company for its voluntary winding up and before the relevant time the company has directly or indirectly made a gift caught by Part I of this Act or an implicative gift—

(a) no order or, as the case may be, decree shall, at any time when proceedings as regards an offence to which that Part applies or, as the case may be a drug trafficking offence have been instituted against the company and have not been concluded or when property of the person to whom the gift was made is subject to a restraint order, be made under section 238 or 239 of the Insolvency Act 1986 (transactions at an undervalue and preferences) or granted under section 242 or 243 of that Act (gratuitous alienations and unfair preferences) in respect of the making of the gift; and

(b) any order made under either of the said sections 242 and 243 or decree granted under either of the said sections 242 or 243 after the conclusion of the proceedings shall take into account any realisation under Part I of this Act of property held by the person to whom the gift was made.

(6) In this paragraph—

• “company” means any company which may be wound up under the Insolvency Act 1986; and

• “the relevant time” means—

  (a)

  where no order for the winding up of the company has been made, the time of the passing of the resolution for voluntary winding up;

  (b)

  where such an order has been made and, before the presentation of the petition for the winding up of the company by the court, such a resolution had been passed by the company, the time of the passing of the resolution; and

  (c)

  in any other case where such an order has been made, the time of the making of the order.

Property subject to floating charge

4 (1) Where any property held subject to a floating charge by a company is realisable or forfeitable property and a receiver has been appointed by, or on the application of, the holder of the charge, the powers of the receiver in relation to the property so held shall not be exercisable in relation to—

(a) so much of it, not being heritable property situated in Scotland, as is for the time being subject to a restraint order made before the appointment of the receiver and so much of it, being heritable property situated in Scotland, as is for the time being subject to a restraint order recorded in the General Register of Sasines or, as the case may be, registered in the Land Register of Scotland before such appointment; and

(b) any proceeds of property realised by virtue of paragraph 1 of Schedule 1 to this Act for the time being in the hands of an administrator appointed under that paragraph.

(2) Where, in the case of a company, such an appointment has been made, the powers conferred on the court by sections 28 to 33 and 35 to 38 of and the said Schedule 1 to this Act or on an administrator appointed under paragraph 1 of that Schedule shall not be exercised in relation to any realisable property held by the company in relation to which the powers of the receiver are exercisable—

(a) so as to inhibit the receiver from exercising his powers for the purpose of distributing any property held by the company to the company’s creditors; or

(b) so as to prevent the payment out of any property of expenses (including the remuneration of the receiver) properly incurred in the exercise of the receiver’s powers in respect of the property.

(3) Nothing in the [1986 c. 45.] Insolvency Act 1986, shall be taken as restricting, or enabling the restriction of, the exercise of the powers so conferred.

(4) In this paragraph—

• “company” has the same meaning as in paragraph 3 above; and

• “floating charge” includes a floating charge within the meaning given by section 462 of the [1985 c. 6.] Companies Act 1985 (power of incorporated company to create floating charge).

Insolvency practitioners dealing with property subject to restraint order

5 (1) Without prejudice to the generality of any enactment contained in the Insolvency Act 1986 or in the 1985 Act, where

(a) any person acting as an insolvency practitioner seizes or disposes of any property in relation to which his functions are, because that property is for the time being subject to a restraint order, not exercisable; and

(b) at the time of the seizure or disposal he believes, and has reasonable grounds for believing, that he is entitled (whether in pursuance of a court order or otherwise) to seize or dispose of that property,

he shall not be liable to any person in respect of any loss or damage resulting from the seizure or disposal except in so far as the loss or damage is caused by the insolvency practitioner’s negligence; and the insolvency practitioner shall have a lien on the property, or the proceeds of its sale, for such of his expenses as were incurred in connection with the liquidation, sequestration or other proceedings in relation to which the seizure or disposal purported to take place and for so much of his remuneration as may reasonably be assigned for his actings in connection with those proceedings.

(2) Any person who, acting as an insolvency practitioner, incurs expenses—

(a) in respect of such realisable property as is mentioned in sub-paragraph (1)(a) above and in so doing does not know and has no reasonable grounds to believe that the property is for the time being subject to a restraint order; or

(b) other than in respect of such realisable property as is so mentioned, being expenses which, but for the effect of a restraint order, might have been met by taking possession of and realising the property,

shall be entitled (whether or not he has seized or disposed of that property so as to have a lien under sub-paragraph (1) above) to payment of those expenses under paragraph 4(2) or (4)(a) of Schedule 1 to this Act.

(3) In the foregoing provisions of this paragraph, the expression “acting as an insolvency practitioner” shall be construed in accordance with section 388 (interpretation) of the said Act of 1986 except that for the purposes of such construction the reference in subsection (2)(a) of that section to a permanent or interim trustee in a sequestration shall be taken to include a reference to a trustee in a sequestration and subsection (5) of that section shall be disregarded; and the expression shall also comprehend the official receiver acting as receiver or manager of the property.

Interpretation

6 (1) In this Schedule “the 1985 Act” means the [1985 c. 66.] Bankruptcy (Scotland) Act 1985.

(2) References in this Schedule to the conclusion of proceedings, except for the purposes of paragraph 2(5) above, shall be construed—

(a) as regards property subject to a restraint order under section 28(1)(a) of this Act, in accordance with section 29(6) of this Act; and

(b) as regards property subject to a restraint order under section 28(1)(b) of this Act, in accordance with section 30(5) of this Act.

(3) References in this Schedule to property held by a person include a reference to property vested in the interim or permanent trustee in his sequestration or in his trustee in bankruptcy or liquidation.

TABLE OF DERIVATIONS

Notes:

1 This Table shows the derivation of the provisions of the Bill.

2 The following abbreviations are used in the Table:—

Acts of Parliament

1987	= Criminal Justice (Scotland) Act 1987 (c. 41)
1988	= Criminal Justice Act 1988 (c. 33)
1993	= Criminal Justice Act 1993 (c. 36)
1994	= Drug Trafficking Act 1994 (c. 37)
1995	= Criminal Justice (Scotland) Act 1995 (1995 c. 20)
1995CP	= Criminal Procedure (Consequential Provisions) (Scotland) Act (1995 c. 40)
1995CLC	= Criminal Law (Consolidation) (Scotland) Act 1995 (1995 c. 39)

Provision	Derivation
1(1)	1987 s.1(1); 1995 s.70(1), Sch.5 §.2
(2)	1987 s.1(2); 1995 s.70(2), Sch.5 §.2
(3)	1987 s.1(2B); 1995 s.70(3), Sch.5 §.2
(4)	1995 s.70(4)
(5)	1987 s.1(1); 1995 s.70(5), Sch.5 §.2
(6)	1987 s.1(2A); 1995 s.70(6), Sch.5 §.2
(7)	1987 s.1(4); 1995 s.70(7)
2	1995 s.71
3	1987 s.3; 1994 Sch.1 §.12; 1995 Sch.5 §.4
4(1)	1987 s.5(1); 1995 s.72(1), Sch.5 §.6
(2)	1987 s.5(2); 1995 s.72(2), Sch.5 §.6
(3)	1987 s.5(4); 1995 s.72(3), Sch.5 §.6
(4)	1987 s.5(5); 1995 s.72(4), Sch.5 §.6
(5)	1987 s.5(5); 1995 s.72(5), Sch.5 §.6
(6)	1987 s.5(7); 1995 Sch.5 §.6
5(1)	1995 s.73(1)
(2)	1995 s.73(2)(part)
(3)	1995 s.73(6)
(4)	1995 s.73(7)
(5)	1995 s.73(8)
6(1)	1987 s.6(1); Law Reform (Miscellaneous Provisions) (Scotland) Act 1990 (c. 40) Sch.8 §.37; 1995 Sch.5 §.7
(2)	1987 s.6(2)(part); 1995 Sch.5 §.7
(3)	1987 s.5(7A); 1995 Sch.5 §.6
(4)	1987 s.5(7B); 1995 Sch.5 §.6
(5)	1987 s.5(7C); 1995 Sch.5 §.6
7(1)	1987 s.6(2)(part); 1995 s.73(2)(part), Sch.5 §.7
(2)	1987 s.6(2)(part); 1995 s.73(2)(part), Sch.5 §.7
(3)	1987 s.6(2)(part); 1995 s.73(2)(part), Sch.5 §.7
(4)	1987 s.6(3); 1995 s.73(3), Sch.5 §.7
(5)	1987 s.6(3A); 1995 s.73(4), Sch.5 §.7
(6)	1995 s.73(5)
8(1)	1987 s.1(2C); 1995 s.74(1), Sch.5 §.2
(2)	1987 s.1(2D); 1995 s.74(2), Sch.5 §.2
(3)	1987 s.1(5); 1995 s.74(3), Sch.5 §.2
(4)	1987 s.1(2E); 1995 s.74(4), Sch.5 §.2
9(1)	1987 s.4(1)(part); 1995 s.75(1), Sch.5 §.5
(2)	1987 s.4(1)(part); 1995 s.75(2), Sch.5 §.5
(3)	1987 s.4(2); 1995 s.75(3), Sch.5 §.5
(4)	1987 s.4(3); 1995 s.75(4)
(5)	1987 s.4(4); 1995 s.75(5), Sch.5 §.5
(6)	1987 s.4(6); 1995 s.75(6), Sch.5 §.5
(7)	1995 s.75(7)
(8)	1987 s.4(5)
10	1987 s.2; 1995 s.76, Sch.5 §.3
11	1987 s.6A; 1995 s.77, Sch.5 §.8
12	1987 s.25; 1995 s.78, Sch.23
13(1)	1987 s.6B(1); 1995 s.79(1), Sch.5 §.8
(2)	1987 s.6B(2); 1995 s.79(2), Sch.5 §.8
(3)	1987 s.6B(3); 1995 s.79(3), Sch.5 §.8
(4)	1987 s.6B(4); 1995 s.79(4), Sch.5 §.8
(5)	1987 s.6B(7); 1995 s.79(5), Sch.5 §.8
(6)	1987 s.6B(6); 1995 s.79(6), Sch.5 §.8
(7)	1987 s.6B(9); 1995 s.79(7), Sch.5 §.8
(8)	1987 s.6B(8); 1995 s.79(8), Sch.5 §.8
(9)	1987 s.6B(5); 1995 Sch.5 §.8
(10)	1987 s.6B(10); 1995 s.79(9), Sch.5 §.8
14	1987 s.7; 1994 Sch.1 §.13; 1995 s.80, Sch.5 §.9
15	Criminal Justice (International Co-operation) Act 1990 (c. 5) s.15; 1995 s.81
16	1987 s.23; 1995 s.82, Sch.5 §.21
17(1)	1987 s.26(1); 1995 s.83(1), Sch.5 §.24
(2)	1987 s.26(1A); 1995 s.83(2), Sch.5 §.24
(3)	1987 s.26(2); 1995 s.83(3), Sch.5 §.24
(4)	1987 s.26(3); 1995 s.83(4), Sch.5 §.24
(5)	1987 s.26(4); 1995 s.83(5), Sch.5 §.24
(6)	1987 s.26(6), 47(5); 1995 s.83(6), Sch.5 §.24
(7)	1987 s.47(1); 1995 s.83(7), Sch.5 §.33
18	1995 s.18
19	1995 s.19
20	1995 s.20
21	1995 s.84
22	1995 s.85
23	1995 s.86
24	1995 s.87
25	1995 s.88
26	1995 s.89
27	1995 s.90
28(1)	1987 s.8(1); 1995 s.91(1), Sch.5 §.11
(2)	1987 s.8(2); 1995 s.91(2), Sch.5 §.11
(3)	1987 s.8(7); 1995 s.91(3), Sch.5 §.11
(4)	1987 s.8(8); 1995 s.91(4), Sch.5 §.11
(5)	1987 s.10(1); 1994 Sch.1 §.14; 1995 s.91(5)
(6)	1987 s.10(2); 1995 s.91(6)
(7)	1987 s.8(9); 1995 s.91(7), Sch.5 §.11
(8)	1987 s.12(1); 1995 s.91(8), Sch.5 §.14
(9)	1987 s.12(2); 1995 s.91(9)
(10)	1987 s.12(3); 1995 s.91(10), Sch.5 §.14
29(1)	1995 s.92(1); Drafting
(2)	1987 s.8(3); 1995 s.92(2), Sch.5 §.11
(3)	1987 s.8(4); 1995 s.92(3), Sch.5 §.11
(4)	1987 s.8(5); 1995 s.92(4), Sch.5 §.11
(5)	1987 s.8(6); 1995 s.92(5), Sch.5 §.11
(6)	1987 s.47(5); 1995 s.92(6), Sch.5 §.33
(7)	1987 s.8(10); 1995 s.92(7), Sch.5 §.11
30	1995 s.93
31	1987 s.9; 1995 s.94, Sch.5 §.11
32	1987 s.11; 1995 s.95, Sch.5 §.12
33	1987 s.11A; 1995 s.96, Sch.5 §.13
34	1995 s.97; Drafting
35	1987 s.27; 1994 Sch.1 §.18; 1995 s.98
36	1987 s.28; 1994 Sch.1 §.19; 1995 s.99
37	1987 s.28A; 1995 s.100, Sch.5 §.25
38	1987 s.28B; 1995 s.101, Sch.5 §.25
39(1)	1987 s.29(1); 1995 s.102(1)
(2)	1987 s.29(2); 1995 s.102(2)
(3)	1987 s.29(3); 1995 s.102(3)
(4)	1987 s.29(3A); 1993 s.22(2)
(5)	1987 s.29(4); 1993 s.21(3); 1995 s.102(4)
40	1987 s.30; Law Reform Miscellaneous Provisions (Scotland) Act 1990 (c. 40) s.63; 1993 s.21(3); 1995 s.103
41	1987 s.30A; Law Reform Miscellaneous Provisions (Scotland) Act 1990 (c. 40) s.63; 1995 s.104
42	1995 s.105
43	1987 s.32; 1995 s.106, Sch.5 §.27
44	1995 s.107; Drafting
45	1987 s.7A; 1995 s.108, Sch.5 §.10
46	1987 s.37A; 1995 s.109, Sch.5 §.32
47(1)	1987 s.45(1); 1995 s.110(4)
(2)	1987 s.45(2); 1995 s.110(5)
(3)	1987 s.45(5); 1995 s.110(7)
(4)	1987 s.45(4); 1995 s.110(6)
48	1987 s.46
49(1)	1995 s.111(1)
(2)	1987 s.1(6); 1988 Sch.5 §.19; 1990 Sch.4 §.5; 1993 s.24(13)
(3)	1987 s.1(6)
(4)	1987 s.1(7); 1993 s.24(15)
(5)	1987 s.1(6); 1990 Sch.4 §.5; 1993 s.24(14)
(6)	1987 ss.5(3), 8(12); 1995 s.111(3), Sch.5 §s.6, 11
(7)	1987 s.47(6); 1995 s.111(4), Sch.5 §.33
50(1), (2)	Drafting
(3) — (5)	1995 s.115(4) — (6)
Sch. 1
§.1	1987 s.13; 1995 Sch.3 §.1, Sch.5 §.15
§.2	1987 s.14; 1995 Sch.3 §.2, Sch.5 §.16
§.3	1987 s.15; 1995 Sch.3 §.3
§.4	1987 s.16; 1988 Sch.5 §.21; 1995 Sch.3 §.4, Sch.5 §.17
§.5	1987 s.17; 1995 Sch.3 §.5, Sch.5 §.18
§.6	1987 s.18; 1995 Sch.3 §.6, Sch.5 §.19
§.7	1987 s.19; 1995 Sch.3 §.7
§.8	1987 s.20; 1995 Sch.3 §.8, Sch.5 §.20
§.9	1987 s.21; 1995 Sch.3 §.9
§.10	1987 s.26(5), (6), 47(5); 1995 Sch.3 §.10
§.11	1987 s.22; 1995 Sch.5 §.11
§.12	1987 s.24; 1995 Sch.5 §.12
Sch. 2	1
§.1	1987 s.33; Housing Act 1988 (c. 50) Sch.17 §.81; 1995 Sch.4 §.1, Sch.5 §.28
§.2	1987 s.34; 1988 Sch.5 §.22; Housing Act 1988 (c. 50) Sch.17 §.81; 1995 Sch.4 §.2, Sch.5 §.29
§.3	1987 s.35; 1995 Sch.4 §.3, Sch.5 §.30
§.4	1987 s.36; 1995 Sch.4 §.4, Sch.5 §.31
§.5	1987 s.37; 1995 Sch.4 §.5, Sch.5 §.32
§.6	1987 s.47(1), (4); 1995 Sch.4 §.6