Bankruptcy (Scotland) Act 1985 (repealed)

Section 59.

SCHEDULE 5 U.K. Voluntary Trust Deeds for Creditors

Modifications etc. (not altering text)

C1 Sch. 5 modified (10.8.2005) by The Insurers (Reorganisation and Winding Up) Regulations 2004 (S.I. 2004/353), reg. 33(7) (as amended by The Insurers (Reorganisation and Winding Up) (Lloyd's) Regulations 2005 (S.I. 2005/1998), reg. 40(11)

Remuneration of trustee S

1 S Whether or not provision is made in the trust deed for auditing the trustee’s accounts and for determining the method of fixing the trustee’s remuneration or whether or not the trustee and the creditors have agreed on such auditing and the method of fixing the remuneration, the debtor, the trustee or any creditor may, at any time before the final distribution of the debtor’s estate among the creditors, have the trustee’s accounts audited by and his remuneration fixed by the Accountant in Bankruptcy.

Valid from 01/04/2008

[F1 Accountant in Bankruptcy's power to carry out audit S

Textual Amendments

F1 Sch. 5 para. 1A and preceding cross-heading inserted (1.4.2008) by Bankruptcy and Diligence etc. (Scotland) Act 2007 (asp 3), ss. 23(1), 227(3) (with s. 223); S.S.I. 2008/115, art. 3(2)(3), Sch. 2 (with arts. 4-6, 10 (as amended (with effect from 31.1.2011) by S.S.I. 2011/31, art. 5))

1A S The Accountant in Bankruptcy may, at any time, audit the trustee's accounts and fix his remuneration.]

Registration of notice of inhibition S

2 (1) The trustee, from time to time after the trust deed has been delivered to him, may cause a notice in such form as shall be prescribed by the Court of Session by act of sederunt to be recorded in the register of inhibitions and adjudications; and such recording shall have the same effect as the recording in that register of letters of inhibition against the debtor. S

(2) The trustee, after the debtor’s estate has been finally distributed among his creditors or the trust deed has otherwise ceased to be operative, shall cause to be so recorded a notice in such form as shall be prescribed as aforesaid recalling the notice recorded under sub-paragraph (1) above.

Lodging of claim to bar effect of limitation of actions U.K.

3 U.K. The submission of a claim by a creditor to the trustee acting under a trust deed shall bar the effect of any enactment or rule of law relating to limitation of actions in any part of the United Kingdom.

Valuation of claims S

4 Unless the trust deed otherwise provides, Schedule 1 to this Act shall apply in relation to a trust deed as it applies in relation to a sequestration but subject to the following modifications—

(a) in paragraphs 1, 2 and 5 for the word “sequestration” wherever it occurs there shall be substituted the words “granting of the trust deed”;

(b) in paragraph 3—

(i) in sub-paragraph (2), for the words from the beginning of paragraph (a) to “or sheriff” there shall be substituted the words “the trustee”; and

(ii) in sub-paragraph (3), for the reference to the permanent trustee there shall be substituted a reference to the trustee;

(c) paragraph 4 shall be omitted; and

(d) in paragraph 5(2) for the references to the permanent trustee there shall be substituted references to the trustee.

Protected trust deeds S

[F2 5 (1) Paragraphs 6 and 7 of this Schedule shall apply in respect of a trust deed if—

(a) the trustee is a person who would not be disqualified under section 24(2) of this Act from acting as the permanent trustee if the debtor’s estate were being sequestrated;

(b) after the trust deed has been delivered to him, the trustee publishes in the Edinburgh Gazette the notice specified in sub-paragraph (3) below;

(c) not later than one week after the date of publication of such notice, the trustee sends to every creditor known to him—

(i) a copy of the trust deed;

(ii) a copy of the notice; and

(iii) such other information as may be prescribed;

(d) within the period of 5 weeks beginning with the date of publication of such notice, the trustee has not received notification in writing from a majority in number or not less than one third in value of the creditors that they object to the trust deed and do not wish to accede to it; and

(e) immediately after the expiry of the said period of 5 weeks, the trustee sends to the Accountant in Bankruptcy for registration in the register of insolvencies a copy of the trust deed with a certificate endorsed thereon that it is a true copy and that he has not received notification as mentioned in sub-sub-paragraph (d) above.

(2) Any creditor who has been sent a copy of the notice referred to in sub-paragraph (1)(b) above and who has not notified the trustee as mentioned in sub-paragraph (1)(d) above that he objects to the trust deed shall be treated for all purposes as if he had acceded to the trust deed; and any reference in this Act to a creditor who has acceded to a trust deed shall include a reference to a creditor who is treated for all purposes as if he had so acceded.

(3) The notice mentioned in sub-paragraph (1)(b) above shall be in the prescribed form and shall contain such information as may be prescribed.

(4) The Secretary of State may by regulations amend sub-paragraphs (1) to (3) above by replacing them, varying them or adding to or deleting anything from them.

(5) Regulations made under sub-paragraph (4) above may contain such amendments of this Act as appear to the Secretary of State to be necessary in consequence of any amendment made by the regulations to the said sub-paragraphs (1) to (3).]

Textual Amendments

F2 Sch. 5 para. 5 substituted (1.4.1993, subject to savings in arts. 4, 5 of S.I. 1993/438) by 1993 c. 6, s. 11(3), Sch. 1 para. 32(2) (with s. 12(6)); S.I. 1993/438, art.3

F3 6 S Where the provisions of paragraph 5 of this Schedule have been fulfilled, then—

[F4 (a) subject to paragraph 7 of this Schedule, a creditor who has—

(i) not been sent a copy of the notice as mentioned in paragraph 5(1)(c) above; or

(ii) notified the trustee of his objection to the trust deed as mentioned in paragraph 5(1)(d) above,

shall have no higher right to recover his debt than a creditor who has acceded to the trust deed;]

(b) the debtor may not petition for the sequestration of his estate while the trust deed subsists.

Textual Amendments

F3 Sch. 5 para. 5 substituted (19.2.2008) for Sch. 5 paras. 5-13 by Bankruptcy and Diligence etc. (Scotland) Act 2007 (asp 3), ss. 20(1), 227(3) (with s. 223); S.S.I. 2008/45, art. 2 (with art. 3)

F4 Sch. 5 para. 6(a) substituted (1.4.1993, subject to savings in arts. 4, 5 of S.I. 1993/438) by 1993 c. 6, s. 11(3), Sch. 1 para. 32(3) (with s. 12(6)); S.I. 1993/438, art.3

F5 7 (1) A qualified creditor [F6 who has not been sent a copy of the notice as mentioned in paragraph 5(1)(c) above or who has notified the trustee of his objection to the trust deed as mentioned in paragraph 5(1)(d) above] may present a petition for sequestration of the debtor’s estate— S

(a) not later than 6 weeks after the date of publication of the notice under [F7 paragraph 5(1)(b)] of this Schedule; but

(b) subject to section 8(1)(b) of this Act, at any time if he avers that the provision for distribution of the estate is or is likely to be unduly prejudicial to a creditor or class of creditors.

(2) The court may award sequestration in pursuance of sub-paragraph (1)(a) above if it considers that to do so would be in the best interests of the creditors.

(3) The court shall award sequestration in pursuance of sub-paragraph (1)(b) above if, but only if, it is satisfied that the creditor’s said averment is correct.

Textual Amendments

F5 Sch. 5 para. 5 substituted (19.2.2008) for Sch. 5 paras. 5-13 by Bankruptcy and Diligence etc. (Scotland) Act 2007 (asp 3), ss. 20(1), 227(3) (with s. 223); S.S.I. 2008/45, art. 2 (with art. 3)

F6 Words in Sch. 5 para. 7(1) substituted (1.4.1993, subject to savings in arts. 4, 5 of S.I. 1993/438) by 1993 c. 6, s. 11(3), Sch. 1 para. 32(4)(a) (with s. 12(6)); S.I. 1993/438, art.3

F7 Words in Sch. 5 para. 7(1)(a) substituted (1.4.1993, subject to savings in arts. 4, 5 of S.I. 1993/438) by 1993 c. 6, s. 11(3), Sch. 1 para. 32(4)(b) (with s. 12(6)); S.I. 1993/438, art.3

F8 8 S In this Act a trust deed in respect of which paragraphs 6 and 7 of this Schedule apply is referred to as a “protected trust deed”.

Textual Amendments

F8 Sch. 5 para. 5 substituted (19.2.2008) for Sch. 5 paras. 5-13 by Bankruptcy and Diligence etc. (Scotland) Act 2007 (asp 3), ss. 20(1), 227(3) (with s. 223); S.S.I. 2008/45, art. 2 (with art. 3)

F9 9 S Where the trustee under a protected trust deed has made the final distribution of the estate among the creditors, he shall, not more than 28 days after the final distribution, send to the Accountant in Bankruptcy for registration in the register of insolvencies—

(a) a statement in the prescribed form indicating how the estate was realised and distributed; and

(b) a certificate to the effect that the distribution was in accordance with the trust deed.

Textual Amendments

F9 Sch. 5 para. 5 substituted (19.2.2008) for Sch. 5 paras. 5-13 by Bankruptcy and Diligence etc. (Scotland) Act 2007 (asp 3), ss. 20(1), 227(3) (with s. 223); S.S.I. 2008/45, art. 2 (with art. 3)

F10 10 S Where the trustee under a protected trust deed has obtained a discharge from the creditors who have acceded to the trust deed he shall forthwith give notice of the discharge—

(a) by sending the notice by recorded delivery to every creditor known to him [F11 who has not been sent a copy of the notice as mentioned in paragraph 5(1)(c) above or who has notified the trustee of his objection to the trust deed as mentioned in paragraph 5(1)(d) above]; and

(b) by sending the notice to the Accountant in Bankruptcy who shall register the fact of the discharge in the register of insolvencies,

and, except where the court makes an order under paragraph 12 below, the sending of such notice to a creditor [F11 who has not been sent a copy of the notice as mentioned in paragraph 5(1)(c) above or who has notified the trustee of his objection to the trust deed as mentioned in paragraph 5(1)(d) above] shall be effective to make the discharge binding upon that creditor.

Textual Amendments

F10 Sch. 5 para. 5 substituted (19.2.2008) for Sch. 5 paras. 5-13 by Bankruptcy and Diligence etc. (Scotland) Act 2007 (asp 3), ss. 20(1), 227(3) (with s. 223)

F11 Words in Sch. 5 para. 10 substituted (1.4.1993, subject to savings in arts. 4, 5 of S.I. 1993/438) by 1993 c. 6, s. 11(3), Sch. 1 para. 32(5) (with s. 12(6)); S.I. 1993/438, art.3

F12 Creditors not acceding to protected trust deed S

Textual Amendments

F12 Sch. 5 para. 5 substituted (19.2.2008) for Sch. 5 paras. 5-13 by Bankruptcy and Diligence etc. (Scotland) Act 2007 (asp 3), ss. 20(1), 227(3) (with s. 223); S.S.I. 2008/45, art. 2 (with art. 3)

F13 11 S A creditor [F14 who has not been sent a copy of the notice as mentioned in paragraph 5(1)(c) above or who has notified the trustee of his objection to the trust deed as mentioned in paragraph 5(1)(d) above] may, not more than 28 days after notice has been sent under paragraph 10 above, apply to the court for an order under paragraph 12 below.

Textual Amendments

F13 Sch. 5 para. 5 substituted (19.4.2008) for Sch. 5 paras. 5-13 by Bankruptcy and Diligence etc. (Scotland) Act 2007 (asp 3), ss. 20(1), 227(3) (with s. 223); S.S.I. 2008/45, art. 2 (with art. 3)

F14 Words in Sch. 5 para. 11 substituted (1.4.1993, subject to savings in arts. 4, 5 of S.I. 1993/438) by 1993 c. 6, s. 11(3), Sch. 1 para. 32(6) (with s. 12(6)); S.I. 1993/438, art.3

F15 12 S Where, on an application by a creditor under paragraph 11 above, the court is satisfied (on grounds other than those on which a petition under paragraph 7(1)(b) above was or could have been presented by that creditor) that the intromissions of the trustee under the protected trust deed with the estate of the debtor have been so unduly prejudicial to that creditor’s claim that he should not be bound by the discharge it may order that he shall not be so bound.

Textual Amendments

F15 Sch. 5 para. 5 substituted (19.2.2008) for Sch. 5 paras. 5-13 by Bankruptcy and Diligence etc. (Scotland) Act 2007 (asp 3), ss. 20(1), 227(3) (with s. 223)

F16 13 S Where the court makes an order under paragraph 12 above, the clerk of court shall send a copy of the order to—

(a) the trustee; and

(b) the Accountant in Bankruptcy who shall register the copy of the order in the register of insolvencies.

Textual Amendments

F16 Sch. 5 para. 5 substituted (19.2.2008) for Sch. 5 paras. 5-13 by Bankruptcy and Diligence etc. (Scotland) Act 2007 (asp 3), ss. 20(1), 227(3) (with s. 223)