Administration of estate by permanent trustee
39AF2Debtor's home ceasing to form part of sequestrated estate
1
This section applies where a debtor's sequestrated estate includes any right or interest in the debtor's family home.
2
At the end of the period of 3 years beginning with the date of sequestration the right or interest mentioned in subsection (1) above shall—
a
cease to form part of the debtor's sequestrated estate; and
b
be reinvested in the debtor (without disposition, conveyance, assignation or other transfer).
3
Subsection (2) above shall not apply if, during the period mentioned in that subsection—
a
the trustee disposes of or otherwise realises the right or interest mentioned in subsection (1) above;
b
the trustee concludes missives for sale of the right or interest;
c
the trustee sends a memorandum to the keeper of the register of inhibitions under section 14(4) of this Act;
d
the trustee registers in the Land Register of Scotland or, as the case may be, records in the Register of Sasines a notice of title in relation to the right or interest mentioned in subsection (1) above;
e
the trustee commences proceedings—
i
to obtain the authority of the sheriff under section 40(1)(b) of this Act to sell or dispose of the right or interest;
ii
in an action for division and sale of the family home; or
iii
in an action for the purpose of obtaining vacant possession of the family home;
f
the trustee and the debtor enter into an agreement such as is mentioned in subsection (5) below;
F1g
the trustee has commenced an action under section 34 of this Act in respect of any right or interest mentioned in sub-section (1) above or the trustee has not known about the facts giving rise to a right of action under section 34 of this Act, provided the trustee commences such an action reasonably soon after the trustee becomes aware of such right.
4
The Scottish Ministers may, by regulations, modify paragraphs (a) to (f) of subsection (3) above so as to—
a
add or remove a matter; or
b
vary any such matter,
referred to in that subsection.
5
The agreement referred to in subsection (3)(f) above is an agreement that the debtor shall incur a specified liability to his estate (with or without interest from the date of the agreement) in consideration of which the right or interest mentioned in subsection (1) above shall—
a
cease to form part of the debtor's sequestrated estate; and
b
be reinvested in the debtor (without disposition, conveyance, assignation or other transfer).
6
If the debtor does not inform the trustee or the Accountant in Bankruptcy of his right or interest in the family home before the end of the period of 3 months beginning with the date of sequestration, the period of 3 years mentioned in subsection (2) above—
a
shall not begin with the date of sequestration; but
b
shall begin with the date on which the trustee or the Accountant in Bankruptcy becomes aware of the debtor's right or interest.
7
The sheriff may, on the application of the trustee, substitute for the period of 3 years mentioned in subsection (2) above a longer period—
a
in prescribed circumstances; and
b
in such other circumstances as the sheriff thinks appropriate.
8
The Scottish Ministers may, by regulations—
a
make provision for this section to have effect with the substitution, in such circumstances as the regulations may prescribe, of a shorter period for the period of 3 years mentioned in subsection (2) above;
b
prescribe circumstances in which this section does not apply;
c
prescribe circumstances in which a sheriff may disapply this section;
d
make provision requiring the trustee to give notice that this section applies or does not apply;
e
make provision about compensation;
f
make such provision as they consider necessary or expedient in consequence of regulations made under paragraphs (a) to (e) above.
9
In this section, “family home” has the same meaning as in section 40 of this Act.