Insolvency technical update - January 2017

david-menzies By David Menzies, ICAS Director of Insolvency

31 January 2017

Round-up of recent developments in insolvency.

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Modernised Insolvency Rules (England & Wales)

The Insolvency Service has launched a blog to discuss and answer questions on the Insolvency (England & Wales) Rules 2016 and their commencement. The blog can be accessed here.

The Insolvency Service have also announced plans for the withdrawal and replacement of forms following the introduction of the new Rules on 6 April 2017.

Webinar: Guidance to Ips – Recognising and dealing with potential tax avoidance

HM Revenue & Customs are hosting a webinar on 9 February from 12noon – 1pm which will outline some of the common issues that arise in insolvency proceedings where tax avoidance is involved and look at HMRC’s stance. Register for this webinar.

10 Predictions for the insolvency profession in 2017

2017 looks to hold a significant number of changes for those involved in insolvency and restructuring. Take a look ahead and see what insolvency practitioners need to look out for in the coming year.

The Postal Administration (Scotland) Rules 2016

The Postal Administration (Scotland) Rules 2016 came into force on 1 October 2016. The rules explain the Postal Administration regime for companies subject to a Postal Administration order made by the courts in Scotland and prescribe the forms to be used by an Insolvency Practitioner appointed to administer such an appointment.

Dear IP 74

The Insolvency Service have issued Dear IP 74. The issue includes information relating to the payment of the Secretary of State administration fee for monies paid into the Insolvency Services Account and on dealing with ongoing utility supplies from British Gas when a debtor enters an IVA.

Protected Trust Deed Standing Committe

The Accountant in Bankruptcy has published the minutes of the PTD Standing Committee meeting held in December 2016. Topics discussed include treatment of high equity in trust deeds, potential changes to PTD legislation following consultation and trustee performance statistics.

Legal Updates

Donnelly v Royal Bank of Scotland [2016] SAC (Civ) 4: The Sheriff Appeal Court has issued its judgement in this case, concluding that the right of set-off of PPI against debt where the debtor has been subject to a trust deed should be the date of pleading and not the date of insolvency. As a result the debtor had a right to receive the full PPI settlement where the claim was submitted after the debtor had received their discharge.

Grampian Maclennan’s Distribution Services Limited V Carnbroe Estates Limited [2017] CSOH 8 : The Court of Session has concluded that a property sold at almost half its market value was not a gratuitous alienation.

R v Neuberg [2016] EWCA Crim 1927 : The Court of Appeal has ruled on a case relating to confiscation orders made against individuals who illegally traded under a prohibited name (s216 Insolvency Act 1986). Anyone convicted of this offence could be ordered to pay a sum equal to the total turnover for the entire period of illegal trading. (via Taylor Wessing)

Brooks v Armstrong (Re Robin Hood Centre plc in liquidation) [2016] EWHC 2893 (Ch) The High Court considered an appeal against an order that two directors compensate a company in liquidation for losses arising from wrongful trading. The outcome highlighted the importance of quantifying the loss to creditors. (via TLT Solicitors)

Wood v Priestley and another [2016] EWHC 2986 (Ch), [2016] All ER (D) 04 (Dec): The High Court considered whether an IP could rely on an indemnity clause within a partnership agreement in respect of costs and expenses incurred defending claims brought against him as a result of his office holder position. (via LexisNexis R&I)

Pickering -v- Davy [2016] EWCA Civ 30: The Court of Appeal considered whether a company should have been restored to the Register after being struck off and concluded that it should not be restored as this would place the applicant at an advantage (rather than restore him to the same position than had the company not been struck off).

Elgin Legal Limited [2016] EWHC 2523 (CH):The High Court was asked to make an administration order retrospectively after an administration has expired automatically during the process of block transfer of cases from one IP to another. (via Taylor Wessing)

Denis Finn Limited (In liquidation) [2016] IEHC 750 : The High Court in Ireland has ordered a liquidator to provide detailed time records to a significant creditor in order that they may assess whether work done was reasonable. (via Irish Legal News)

M & K Rodgers v Pixel West Ltd: An employment tribunal has confirmed that employees who have been unfairly dismissed from an insolvent employer can bring an action against a connected successor company. (via Squire Patton Boggs)

Professional development opportunities from ICAS

A number of courses are being run by ICAS/BPP in the next few months:

CPI/CPPI/CPCI – 2017 training programme commences 3 February 2017.

Joint Insolvency Exam – 2017 training programme commences 2 February 2017.

Topics

  • Insolvency
  • Insolvency Permit holders

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