Debtor's petition meaning

Checklist and timeline A straightforward checklist and timeline sets out each stage from the point a debt becomes due right through to a bankruptcy petition being presented. It is relevant to personal insolvency where a statutory demand has been served on the debtor. For further reading on statutory demands, please refer to: Statutory demands for restructuring and insolvency professionals—overview Practice Note: What is a statutory demand?...

Step/action Time (days) Section/rule 1. Draft the statutory demand. Depending on the type of debt asserted, consult: (Form SD2) r 10.1 Statutory Demand under Section 268(1)(a) of the Insolvency Act 1986. Debt for Liquidated Sum Payable Immediately (Formerly form 6.1) (Form SD3) r 10.1 Statutory Demand under Section 268(1)(a) of the Insolvency Act 1986. Debt Payable at Future Date (Formerly form 6.3) (Form SD4) r 10.1 Statutory Demand under Section 268(1)(a) of the Insolvency Act 1986. Debt for Liquidated Sum Payable Immediately Following a Judgment or Order of the Court (Formerly form 6.2) Day 1 Insolvency (England and Wales) Rules 2016 (IR 2016), SI 2016/1024, r 10.1; Section 268 of Insolvency Act 1986 (IA 1986) 2. Arrange and complete service of the statutory demand on the debtor. Service should ordinarily be personal unless circumstances are exceptional. Day 2–10 IA 1986, s 268; IR 2016, SI 2016/1024, r 10.2; PDIP, para 12.7 3....

Sriram (acting by her litigation friend, the Official Solicitor) v Revenue and Customs Commissioners and another [2024] EWHC 853 (Ch), [2024] All ER (D) 86 (Apr) What are the practical implications of this case? Creditors should act with care to ensure that service of a statutory demand (and bankruptcy petition) is properly effected, particularly where a debtor seeks to avoid service and has several addresses. Attempts to serve ought to be clearly and contemporaneously recorded. Creditors are required to take all reasonable measures to bring the document or documents to the debtor’s attention. However, this does not oblige them to attend or write to every address associated with the debtor that they know about. The addresses that must be tried will depend on the circumstances of the individual case. A wide, scattergun strategy to service is not expected. By way of example, if a debtor holds multiple properties and there is no reply to a visit or correspondence at one property, that location may not amount to a ‘known’...

Prince Hussam Bin Saud and another v Mobile Telecommunications Company KSCP [2024] EWHC 1724 (Ch) What are the practical implications of this case? The decision offers clear, practical guidance on applying the ‘good arguable case’ limb when seeking permission to serve the petition outside the jurisdiction, pursuant to Schedule 4 of the Insolvency (England and Wales) Rules 2016 and CPR 6.37. It further emphasises how the appellate court treats attempts to overturn a first instance judge’s assessment of the facts—in particular, whether the appellant debtor maintained a place of residence within the jurisdiction at any point during the three years before the petition was presented. In addressing these issues, the judge also drew together and explained the authorities on what amounts to a place of residence for the purposes of IA 1986, s 265, which operates as a threshold requirement for making a bankruptcy order...

What are the practical implications of this case? In a standard, rather than mental health, breathing space moratorium, a creditor will generally find it simpler to persuade the court to continue with a bankruptcy petition already on foot than to secure permission to present a fresh petition, because, in the former scenario, the court’s discretion is not constrained by the limitations imposed by the breathing space legislation, whereas seeking to present during the moratorium engages those constraints. Moreover, in applying those statutory limits, where the debtor has had ample time to obtain advice, explore alternative solutions, and prepare adequately for a hearing, allowing the petition to proceed will not be viewed as causing the debtor any detriment. A petition will also not constitute an abuse of process for an extraneous purpose merely because a creditor is angry or vengeful; rather, there must be evidence showing that the petition was brought with the intention of harming the debtor, as opposed to legitimately setting the bankruptcy process in motion. Accordingly, continuation...

Once a bankruptcy petition and its supporting documents have been presented (or issued) at court, the petitioning creditor’s initial step is to ensure the documents are served on the debtor. This Practice Note outlines the methods by which a petitioning creditor must serve the bankruptcy petition on the debtor. It does not cover service of any other documents within insolvency proceedings. For further guidance on issuing a bankruptcy petition or what to expect at the bankruptcy hearing, see: Creditors’ bankruptcy petitions—grounds and documents required for presentation Bankruptcy petitions—process and procedure post-presentation of the petition The general rule—personal service of the bankruptcy petition on the debtor The general rule is that a sealed copy of the bankruptcy petition must—unless the court orders substituted service—be served on the debtor personally by an officer of the court, the petitioning creditor, the creditor’s solicitor, or a person instructed by the creditor or their solicitor. In practice, most bankruptcy petitions are personally served on the debtor by...

This Practice Note provides a concise overview of bankruptcy and its effect on legal proceedings from a dispute resolution standpoint, summarising key points in practice... What is bankruptcy? Bankruptcy is an insolvency route for individuals. It applies to individuals only. Prior to 6 April 2016—and in contrast to corporate liquidation—only the court had power to make an individual bankrupt. From 6 April 2016, a new bankruptcy applications regime took effect, replacing debtors' bankruptcy petitions, though creditors' petitions remained unaffected. Petitions lodged by debtors before that date were unaffected; now, anyone seeking their own bankruptcy must file an online application decided by an adjudicator—an official of the Insolvency Service—rather than the court. For more detail and background, see News Analysis: New bankruptcy applications regime to come into force. Once a bankruptcy order is made—by the court or by the adjudicator—it releases the debtor from liabilities owed to creditors (subject to certain statutory exceptions) and bars unsecured creditors from starting—or continuing with—any legal process against the bankrupt or their property...

Practice Note This Practice Note consists of two strands created to help dispute resolution practitioners remain up to date with developments in case law that affect their field, or which influence civil litigation procedure more generally: selected forthcoming appeals to the Supreme Court are highlighted below; see Key forthcoming appeals to the Supreme Court—2022 summaries of significant appeal decisions in England and Wales (ie rulings of the Court of Appeal and Supreme Court and, where appropriate, certain judgments of the Competition Appeal Tribunal, Judicial Committee of the Privy Council, Court of Justice of the European Union), and ECtHR, which we have covered; see: Key forthcoming appeal cases—2022 You can navigate this content using the table of contents in the left-hand margin. Alternatively, search this tracker using [CTRL]+[F]. This material is not intended to be a comprehensive register of every appeal or major decision relevant to dispute resolution practitioners. Key forthcoming appeals to the Supreme Court—2022 Tort and negligence ...

STOP PRESS From 6 April 2017, the Insolvency Rules 1986 (SI 1986/1925) were revoked and superseded by the Insolvency (England and Wales) Rules 2016 (IR 2016) (SI 2016/1024). The material in this Q&A may have been impacted by this amendment. Service out of the jurisdiction Under rule 6.14(6) of the Insolvency Rules 1986 (SI 1986/1925) (IR 1986), a bankruptcy petition can be served beyond England and Wales, but only with the court’s leave, and the court may specify how service is to be carried out. For bankruptcy petitions, IR 1986, r 12A.20 states that Civil Procedure Rules 6 (CPR) apply to serving court documents outside the jurisdiction, subject to any modifications directed by the court...