Bankruptcy (Scotland) Act 1985

The Companies Act 1985 (c.6)

19 (1) In section 613 (ranking of claims in Scotiand)—

(a) in subsection (1), for the words from " following provisions " to the end of paragraph (c) there shall be substituted the words—

“following enactments—

(a) sections 22 (except subsection (8)), 23(1) and (2),48 (except in so far as it relates to the application of section 22(8)), 49 and 50 of, and Schedule 1 to, the Bankruptcy (Scotland) Act 1985 (claims by creditors for voting and payment of dividends) ;

(b) paragraphs 11 and 13 of Schedule 6 to that Act (voting at meetings);

(c) section 60 of that Act (liabilities and rights of co-obligants); and

(d) sections 8(5) and 22(8) of that Act (including section 22(8) as applied by section 48(7) of that Act);”and

(b) in subsection (2)—

(i) for the word " 1913 " there shall be substituted the word " 1985 ";

(ii) for the word " trustee " there shall be substituted the words " interim or permanent trustee "; and

(iii) for the word " bankrupt " there, shall be substituted the word " debtor

20 After section 615 there shall be inserted the following sections—

“615A Gratuitous alienations.

(1) Where this subsection applies and—

(a) the winding up of a company has commenced, an alienation by the company is challengeable by—

(i) any creditor who is a creditor by virtue of a debt incurred on or before the date of such commencement; or

(ii) the liquidator ;

(b) an administration order is in force in relation to a company, an alienation by the company is challengeable by the administrator.

(2) Subsection (1) applies where—

(a) by the alienation, whether before or after the coming into force of section 75 of the Bankruptcy (Scotland) Act 1985, any part of the company's property is transferred or any claim or right of the company is discharged or renounced ; and

(b) the alienation takes place on a relevant day.

(3) For the purposes of subsection (2)(b), the day on which an alienation takes place is the day on which it becomes completely effectual ; and in that subsection " relevant day" means, if the alienation has the effect of favouring—

(a) a person who is an associate (within the meaning of the Bankruptcy (Scotland) Act 1985) of the company, a day not earlier than 5 years before the date on which—

(i) the winding up of the company commences ; or

(ii) as the case may be, the administration order is made ; or

(b) any other person, a day not earlier than 2 years before such date.

(4) Subsections (4) to (6) and (8) of section 34 of the Bankruptcy (Scotland) Act 1985 (challenge of gratuitous alienation) apply for the purposes of this section as they apply for the purposes of that section but as if—

(a) for any reference to the debtor there is substituted a reference to the company ; and

(b) in subsection (8) for the words: from the beginning to " 1889 " there are substituted the words " A liquidator and, after the coming into force of Chapter III of Part II of the Insolvency Act 1985, an administrator appointed thereunder ".

(5) In subsections (1) to (3) above, any reference to an administrator or to an administration order—

(a) shall be construed in accordance with Chapter III of Part II of the Insolvency Act 1985 ; and

(b) shall be of no effect until the coming into force of that Chapter.

(6) This section extends to Scotland only.

615B Unfair preferences.

(1) Section 36 of the Bankruptcy (Scotland) Act 1985 (unfair preferences) applies for the purposes of this Act as it applies for the purposes of that Act but as if—

(a) for any reference to a debtor there is substituted a reference to a company ;

(b) in subsection (1), for paragraphs (a) to (c) there are substituted the words " the commencement of the winding up of the company or the making of an administration order in relation to the company. ";

(c) in subsection (4) for paragraphs (d) and (b) there are substituted the following paragraphs—

“(a) in the case of a winding up—

(i) any creditor who is a creditor by virtue of a debt incurred on or before the date of commencement of the winding up ; or

(ii) the liquidator ; and (b) in the case of an administration order, the administrator.” ;

(d) in subsection (6), for the words from the beginning to " 1889 " there are substituted the words " A liquidator and an administrator "; and

(e) for subsection (7) there is substituted the following subsection—

“(7) This section shall be construed as one with Part XX of the Companies Act 1985 ; and subsection (5) of section 615A of that Act shall apply in relation to the foregoing provisions of this section as it applies in relation to subsections (1) to (3) of that section.”.

(2) This section applies to Scotland only.”

21 For subsections (1) to (5) of section 623 (effect of diligence within 60 days of winding up Scottish company), there shall be substituted the following subsections—

“(1) In the winding up of a company registered in Scotland, the following provisions of the Bankruptcy (Scotland) Act 1985—

(a) subsections (1) to (6) of section 37 (effect of sequestration on diligence); and

(b) subsections (3), (4), (7) and (8) of section 39 (realisation of estate),

apply, so far as is consistent with this Act, in like manner as they apply in the sequestration of a debtor's estate, with the substitutions specified below and with any other necessary modifications.

(2) The substitutions to be made in those sections of the Act of 1985 are as follows—

(a) for references to the debtor, substitute references to the company,

(b) for references to the sequestration, substitute references to the winding up,

(c) for references to the date of sequestration, substitute references to the commencement of the winding up of the company, and

(d) for references to the permanent trustee, substitute references to the liquidator.

(3) In this section, " the commencement of the winding up of the company " means, where it is being wound up by the court, the day on which the winding up order is made.”.

22 In section 643 (unclaimed dividends etc. in Scotland to be lodged in bank)—

(a) for the words " a joint stock bank of issue in Scotland" there shall be substituted the words " an appropriate bank or institution as defined in section 73(1) (interpretation) of the Bankruptcy (Scotland) Act 1985 ";

(b) after the word "bank" wherever it occurs there shall be inserted the words " or institution "; and

(c) for the words "one hundred and fifty-three of the Bankruptcy (Scotland) Act 1913 " there shall be substituted the words " 58 of the Bankruptcy (Scotland) Act 1985 ".