Jurisdiction(s):
United Kingdom

Related legal acts

Key definition

Insolvency definition

What does Insolvency mean? In practice, insolvency describes a financial state where a debtor cannot meet liabilities when due, triggering remedies such as administration, liquidation or bankruptcy and informing directors’ duties and avoidance claims. For companies in England & Wales, Scotland and Northern Ireland, the Insolvency Act 1986, s 123 sets two alternative tests: - Cash‑flow insolvency: an inability to pay debts as they fall due. The inquiry is practical and forward‑looking, not confined to today’s bills (Re Patrick & Lyon Ltd [1933] Ch 786; BNY Corporate Trustee Services Ltd v Eurosail [2013] UKSC 28). - Balance‑sheet insolvency: liabilities (including contingent and prospective liabilities) exceed assets on...

Review, rescission and variation of insolvency orders in England and Wales: principles, procedure and case law (bankruptcy and winding up)

Published by a LexisNexis Restructuring & Insolvency expert

Practice notes

Reviews in Insolvency proceedings

A review in insolvency proceedings is the court’s reconsideration of an order it has already made. The review mechanism, available in both corporate and personal insolvency, permits a determination to be looked at again either by the judge who issued it (see Official receiver v Bathurst) or by a different judge (see Re W & A Glaser Ltd). The authority to revisit orders is a feature particular to the insolvency court. For corporate insolvency, the power appears in the Insolvency (England and Wales) Rules 2016 (IR 2016), SI 2016/1024, r 12.59(1), which provides that the corporate insolvency court may review, rescind, or vary any order it has made when exercising its jurisdiction. The equivalent in personal insolvency is section 375 of the Insolvency Act 1986 (IA 1986). That provision, mirroring the corporate regime, states that the court may review, rescind, or vary any order made by it in the exercise of its jurisdiction. Reviews should not be treated as a substitute for an appeal, and the court will apply its discretion to revisit an order with care. Accordingly, applications for review are approached with caution by the court and are never a surrogate appeal route...

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Matthew Parfitt

Erskine Chambers

Matthew is an advocate, litigator and adviser who specialises in company and insolvency law. In 2020 he was appointed to the Attorney General’s A Panel to act in the most complex and significant government litigation. He spent ten years on the B and C Panels which allowed him to develop substantial unled advocacy experience.He is ranked in Chambers & Partners and in the Legal 500 as a leading junior for company law and, in the Legal 500, for insolvency. The directories say he is a “clever, accommodating and client-friendly junior counsel”; “he is quietly persuasive and his advocacy is faultless”; and he has “a cool head, a comprehensive knowledge of his field and an excellent responsiveness to pressurised demands”. He was appointed as a Deputy Insolvency and Companies Court Judge in 2020.Recent important cases include:Re Akkurate Ltd [2020] EWHC 1433 (Ch) (the leading case on the...

Web page updated on 22/05/2026

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