PART 2Amendments of Insolvency Act 1986

Decisions of creditors’ meetings and preferential debtsI16

1

Section 258 of the Insolvency Act 1986 (decisions of creditors’ meeting)14 is amended as follows.

2

In subsection (5)—

a

omit the “or” at the end of paragraph (a);

b

after paragraph (a) insert—

aa

any ordinary preferential debt of the debtor is to be paid otherwise than in priority to any secondary preferential debts that the debtor may have,

c

in paragraph (b)—

i

for “a preferential debt”, substitute “an ordinary preferential debt”, and

ii

for “another”, substitute “another ordinary”;

d

at the end of paragraph (b), insert—

or

c

a preferential creditor of the debtor is to be paid an amount in respect of a secondary preferential debt that bears to that debt a smaller proportion than is borne to another secondary preferential debt by the amount that is to be paid in respect of that other debt.

3

In subsection (7), for “has” substitute “, “ordinary preferential debt” and “secondary preferential debt” each has”.