Section 264
Textual Amendments applied to the whole legislation
F1Act: for the words "solicitor of the Supreme Court of Northern Ireland" wherever they occur there is substituted (prosp.) the words "solicitor of the Court of Judicature of Northern Ireland" by virtue of Constitutional Reform Act 2005 (c. 4), ss. 59, 148(1), Sch. 11 para. 5 [Editorial Note: this amendment will be carried through into the text of the Act at the same time as any other effects on the Act for the year in which the relevant commencement order (or first such order) is made]
1The following shall be substituted for section 261 of the Insolvency Act 1986 (effect of voluntary arrangement: undischarged bankrupt)—
(1)This section applies where—
(a)the creditors’ meeting summoned under section 257 approves the proposed voluntary arrangement (with or without modifications), and
(b)the debtor is an undischarged bankrupt.
(2)Where this section applies the court shall annul the bankruptcy order on an application made—
(a)by the bankrupt, or
(b)where the bankrupt has not made an application within the prescribed period, by the official receiver.
(3)An application under subsection (2) may not be made—
(a)during the period specified in section 262(3)(a) during which the decision of the creditors’ meeting can be challenged by application under section 262,
(b)while an application under that section is pending, or
(c)while an appeal in respect of an application under that section is pending or may be brought.
(4)Where this section applies the court may give such directions about the conduct of the bankruptcy and the administration of the bankrupt’s estate as it thinks appropriate for facilitating the implementation of the approved voluntary arrangement.”
2The following shall be inserted after section 263 of that Act (implementation of voluntary arrangement)—
“Fast-track voluntary arrangement
Section 263B applies where an individual debtor intends to make a proposal to his creditors for a voluntary arrangement and—
(a)the debtor is an undischarged bankrupt,
(b)the official receiver is specified in the proposal as the nominee in relation to the voluntary arrangement, and
(c)no interim order is applied for under section 253.
(1)The debtor may submit to the official receiver—
(a)a document setting out the terms of the voluntary arrangement which the debtor is proposing, and
(b)a statement of his affairs containing such particulars as may be prescribed of his creditors, debts, other liabilities and assets and such other information as may be prescribed.
(2)If the official receiver thinks that the voluntary arrangement proposed has a reasonable prospect of being approved and implemented, he may make arrangements for inviting creditors to decide whether to approve it.
(3)For the purposes of subsection (2) a person is a “creditor” only if—
(a)he is a creditor of the debtor in respect of a bankruptcy debt, and
(b)the official receiver is aware of his claim and his address.
(4)Arrangements made under subsection (2)—
(a)must include the provision to each creditor of a copy of the proposed voluntary arrangement,
(b)must include the provision to each creditor of information about the criteria by reference to which the official receiver will determine whether the creditors approve or reject the proposed voluntary arrangement, and
(c)may not include an opportunity for modifications to the proposed voluntary arrangement to be suggested or made.
(5)Where a debtor submits documents to the official receiver under subsection (1) no application under section 253 for an interim order may be made in respect of the debtor until the official receiver has—
(a)made arrangements as described in subsection (2), or
(b)informed the debtor that he does not intend to make arrangements (whether because he does not think the voluntary arrangement has a reasonable prospect of being approved and implemented or because he declines to act).
As soon as is reasonably practicable after the implementation of arrangements under section 263B(2) the official receiver shall report to the court whether the proposed voluntary arrangement has been approved or rejected.
(1)This section applies where the official receiver reports to the court under section 263C that a proposed voluntary arrangement has been approved.
(2)The voluntary arrangement—
(a)takes effect,
(b)binds the debtor, and
(c)binds every person who was entitled to participate in the arrangements made under section 263B(2).
(3)The court shall annul the bankruptcy order in respect of the debtor on an application made by the official receiver.
(4)An application under subsection (3) may not be made—
(a)during the period specified in section 263F(3) during which the voluntary arrangement can be challenged by application under section 263F(2),
(b)while an application under that section is pending, or
(c)while an appeal in respect of an application under that section is pending or may be brought.
(5)The court may give such directions about the conduct of the bankruptcy and the administration of the bankrupt’s estate as it thinks appropriate for facilitating the implementation of the approved voluntary arrangement.
(6)The Deeds of Arrangement Act 1914 (c. 47) does not apply to the voluntary arrangement.
(7)A reference in this Act or another enactment to a voluntary arrangement approved under this Part includes a reference to a voluntary arrangement which has effect by virtue of this section.
Section 263 shall apply to a voluntary arrangement which has effect by virtue of section 263D(2) as it applies to a voluntary arrangement approved by a creditors’ meeting.
(1)The court may make an order revoking a voluntary arrangement which has effect by virtue of section 263D(2) on the ground—
(a)that it unfairly prejudices the interests of a creditor of the debtor, or
(b)that a material irregularity occurred in relation to the arrangements made under section 263B(2).
(2)An order under subsection (1) may be made only on the application of—
(a)the debtor,
(b)a person who was entitled to participate in the arrangements made under section 263B(2),
(c)the trustee of the bankrupt’s estate, or
(d)the official receiver.
(3)An application under subsection (2) may not be made after the end of the period of 28 days beginning with the date on which the official receiver makes his report to the court under section 263C.
(4)But a creditor who was not made aware of the arrangements under section 263B(2) at the time when they were made may make an application under subsection (2) during the period of 28 days beginning with the date on which he becomes aware of the voluntary arrangement.
(1)Section 262A shall have effect in relation to obtaining approval to a proposal for a voluntary arrangement under section 263D.
(2)Section 262B shall have effect in relation to a voluntary arrangement which has effect by virtue of section 263D(2) (for which purposes the words “by a creditors’ meeting summoned under section 257” shall be disregarded).”
3The following shall be inserted after section 389A of that Act (authorisation of nominees and supervisors)—
(1)The official receiver is authorised to act as nominee or supervisor in relation to a voluntary arrangement approved under Part VIII provided that the debtor is an undischarged bankrupt when the arrangement is proposed.
(2)The Secretary of State may by order repeal the proviso in subsection (1).
(3)An order under subsection (2)—
(a)must be made by statutory instrument, and
(b)shall be subject to annulment in pursuance of a resolution of either House of Parliament.”