(1)Any payment made by any person other than the Board to the policyholder, to a person entitled to the benefit of a judgment, or to any other person, being a payment which is referable to any such liability of a company in liquidation as is mentioned in section 6, 7 or 8 above, shall be treated as reducing any sum payable to the policyholder or to the person entitled to the benefit of the judgment, in accordance with any provision of those sections, by reference to that liability.
(2)This subsection applies in any case where it appears to the Board, in respect of a long term policy of a company in liquidation—
(a)that any other person has made a payment to the policyholder or to any other person which is referable to any liability of the company under the policy which was outstanding at the beginning of the liquidation or which is otherwise required in accordance with subsection (3) below to be taken into account in relation to the policy; or
(b)that any other person has taken any other measures for assisting or protecting the policyholder (whether measures of a like description to those open to the Board under subsection (5) of section 11 above or otherwise) which ought to be taken into account for the purpose of excluding or modifying any of their duties towards the policyholder under sections 10 and 11 above.
(3)Any payment made—
(a)by reference to any valuation of a long term policy of a company in liquidation or of any of the benefits provided for under any such policy; or
(b)by reference to any future benefits under a long term policy of a company in liquidation;
shall be taken into account in relation to that policy for the purposes of subsection (2)(a) above (whether it was made to the policyholder or to any other person).
(4)Nothing in sections 10 and 11 above shall require the Board, in a case to which subsection (2) above applies, to take any measures for assisting the policyholder in respect of the long term policy in question where it appears to the Board to be inappropriate to do so in view of any such payment or other measures of assistance or protection as are mentioned in that subsection.
(5)In any case to which subsection (2) above applies, other than one falling within subsection (4) above, the Board may treat any sum payable to the policyholder in accordance with section 10 or section 11(7), (9) or (10) above and any sum to be secured for the policyholder by virtue of section 11(4) above as reduced to any extent appearing to them to be appropriate in the circumstances of the case.
(6)Any sums secured by the Board under subsection (7) of section 11 above for a policyholder of a company in liquidation or for any other person by reference to any future benefits under a long term policy shall be treated as reducing any sum payable to the policyholder in respect of that policy in accordance with subsection (9) or (10) of that section.
(7)The Board may postpone taking any of the measures provided for by sections 6 to 11 above in any case where it appears to the Board that, independently of any measures they may take, any other person (not being the liquidator) may make any payment or take any measures which would, by virtue of subsection (1), (4) or (5) above, affect any of their duties under those sections in relation to the case in question.
(8)A payment is referable to a liability of a company in liquidation for the purposes of this section if it has the effect of reducing or discharging, or is otherwise made by reference to, that liability or any liability of the policyholder or any other person from which that liability arises.
(9)In this section “future benefit” has the same meaning as in section 11 above.