Open file - Accountant in Bankruptcy

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New Functions of AiB
Chris Boyland
Strategic Reform
New Functions of AiB
These functions will be transferred from the Courts to AIB:
1. Application by the trustee for direction in matters in sequestration
where the Accountant in Bankruptcy is not the trustee
2. Recall where the only ground is that the debtor can pay all of their
debts and the fees and outlays of the trustee in full.
3. Bankruptcy Restriction Order (BRO)
4. Appointment of a replacement trustee
5. Replacement of trustee acting in more than one sequestration
And:
6. Removal of trustee and trustee not acting
7. Extension time period for a trustee to adopt a contact
8. Conversion a PTD into a sequestration
9. Cure a defect in procedure
10. Valuation of debts depending on contingency
New Functions of AiB
Making an application to AiB in relation to these new functions:
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Applications should be made on the appropriate statutory form
Applications can be made electronically or in writing/by post
AiB will record receipt of the application on BASYS, AiB’s new case
management system.
If any interested party disagrees with an AiB decision in relation to
these new functions (or AiB’s existing functions), then they must apply
to AiB for a review of that decision before they can make an appeal to
the Sheriff Court
If any interested party does apply for a review, then AiB must: notify all
other interested parties of the application, provide them with a copy of
the decision and review application, and advise them that they have 21
days in which to make written representations, should they wish to do
so.
New Functions of AiB
Process/Timescales:
1. Application by the trustee for direction in matters in
sequestration where the Accountant in Bankruptcy is not the
trustee:
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Trustees may apply to AiB for a direction in relation to any particular
matter arising in the sequestration.
AiB must make a direction within 28 days of receipt of the application
or refer the application to the Sheriff.
Where AiB has sought direction from the Sheriff, it must notify the
trustee within 7 days of receipt of the direction from the Sheriff
Interested parties will have 14 days from the date of issue of the
direction in which to apply for a review of AiB’s decision.
New Functions of AiB
Process/Timescales:
2. Recall where the only ground is that the debtor can pay all of their
debts and the fees and outlays of the trustee in full
(N.B. AiB can also recall an award where there are concurrent
sequestrations and the sheriff has issued a direction.)
• The debtor, any creditor, the trustee or any other interested party can
apply to AiB for the recall of sequestration where the debtor has paid
or is able to pay his debts in full.
• Interested parties will have 21 days to make representations, from the
date that AiB receives the application for recall.
• Where the applicant is the trustee, a statement of affairs should be
submitted at the same time as the application.
• Where the applicant is someone else, the trustee must provide a
statement of affairs to the applicant and a statement of affairs must be
submitted before the expiry of the 21 day period.
New Functions of AiB
Process/Timescales:
2. Recall where the only ground is that the debtor can pay all of their
debts and the fees and outlays of the trustee in full (cont’d):
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Failure to submit a statement of affairs by the deadline will mean that
the application is not complete and, therefore, it cannot be progressed
until a statement of affairs is received.
Where the statement of affairs indicates that the amount of the
trustee’s outlays and remuneration are not agreed, AiB must make a
determination of outlays and remuneration
Where recall is granted, AiB must consider the annulment of any
BRO/interim BRO in force at the time
AiB must record its decision to grant recall on the RoI or to refuse to
grant recall of an award of sequestration on BASYS.
AiB must issue a copy of its decision to all interested parties.
New Functions of AiB
Process/Timescales:
3. Bankruptcy Restriction Orders (BROs):
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BRO’s for a time period of less than 5 years may now be made by AiB
BROs for a period of 5 years or more may still only be made by a
Sheriff.
A BRO may only be made by the Sheriff on the application of AiB.
AiB must notify the debtor of the application to make a BRO.
This notification must advise the debtor of the reasons for the BRO
and inform them that that they have 14 days to make representations
AiB must proceed to make or not to make a BRO within 21 days of
issuing the notice to the debtor and after considering any written
representations
AiB must record its decision in the RoI where a BRO is made.
New Functions of AiB
Process/Timescales:
4. Appointment of a replacement trustee:
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Where there is no timeous objection, AiB must declare the elected
person to be the replacement trustee, without delay.
Where there is an objection, AiB must consider the objection, giving all
interested parties the opportunity to make representations.
Interested parties will have 14 days from the receipt of the objection in
which to make representations.
On the expiry of the 14 days, AiB must make its decision within 7 days
and advise all interested parties.
AiB must record its decision on the RoI where a replacement trustee is
appointed.
New Functions of AiB
Process/Timescales:
5. Replacement of trustee acting in more than one sequestration:
• Where a trustee is no longer able to act as trustee either because he
has died, ceased to be qualified to act as a trustee, or there is a
conflict in interest or a change in personal circumstances, AiB may
determine that the trustee is removed from office
• The applicant must notify all interested parties known to them of their
application, in order that they may make representations
• AiB will record the date on which notice was given
• Interested parties will have 14 days to make representations, from the
date on which notice was given
• AiB must take any representations into account before making its
decision
• If AiB determines that no person is to be appointed, then the AiB is
deemed to be the replacement trustee.
• AiB must record its decision in the RoI
New Functions of AiB
Process/Timescales:
6. Removal of trustee and trustee not acting:
• AiB can remove a trustee from office if there are reasons to do so
• An application for removal can be made by the commissioners or a
person representing not less than 25% in value of creditors
• On receipt of the application, AiB must issue a copy to the trustee
advising them that they have 21 days to make representations
• AiB must grant the order within 14 days or refer the matter to the
Sheriff
• Where AiB has referred the case to the Sheriff for a direction, AiB will
have 7 days from the receipt of the direction to make their decision.
• AiB must record its decision in the RoI where the application is upheld
• AiB must send a copy of the order to the trustee, commissioners and
any creditors, as they are the only people who may request a review of
the decision
New Functions of AiB
Process/Timescales:
7. Extension time period for a trustee to adopt a contract:
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In cases where AiB is not the trustee, instead of applying to the Sheriff
to extend the 28 day period, on the expiry of which the trustee must
adopt or refuse to adopt a contract, the trustee must apply to AiB
instead.
AiB must advise the trustee of their decision either to extend or refuse
to extend the period to adopt the contract or that AiB has sought a
direction from the Sheriff in regard to the extension within 14 days.
Where AiB has sought a direction from the Sheriff, the 14 days is
extended until the Sheriff makes his decision.
AiB must advise the trustee of the Sheriff’s direction within 7 days
AiB must record their decision on BASYS.
New Functions of AiB
Process/Timescales:
8. Conversion a PTD into a sequestration:
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A member state liquidator will now apply to the AiB for the conversion
(under Article 37 of the EC Insolvency Regulation) for conversion of a
PTD into sequestration instead of petitioning the Sheriff Court
An affidavit will be prepared and sworn and submitted in support of the
application.
The application will be served upon the debtor, the trustee and other
interested parties
AiB will make such an order as it sees fit, within 14 days of receipt of
the application
AiB must advise the applicant, the debtor, the trustee and any other
interested parties of its decision
AiB must record its decision on the RoI.
New Functions of AiB
Process/Timescales:
9. Cure a defect in procedure:
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AIB can make an order correcting a clerical or incidental error in a
document or waive a failure to comply with a time limit
An order can be made on an application by interested party or without
an application if AIB proposes to correct a matter
Interested parties will have 14 days from the date of notification of an
application, to make representations
AiB must make its decision within 14 days of the expiry of the period of
14 days allowed for representations.
AiB must record its decision on BASYS and notify all interested
persons.
New Functions of AiB
Process/Timescales:
10. Valuation of debts depending on contingency:
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In cases where there is no permanent trustee, a creditor must now
apply to AiB for a valuation of a contingent debt
In cases where there is a permanent trustee, the creditor will apply to
the permanent trustee, as before.
AiB will put a value on the debt, so far as it is contingent
AiB must record its decision on BASYS, advising the creditor and all
interested persons of its valuation
The creditor can apply to AiB for a review of its valuation
THANK YOU
Chris Boyland, Head of Strategic Reform
0141 278 4412, [email protected]
1 Pennyburn Road, Kilwinning, Ayrshire, KA13 6SA
T 0300 200 2600 F 0300 200 2601 W www.aib.gov.uk
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