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...

Decision procedures, meetings and deemed consent under IR 2016 Part 15 (England and Wales): notices, voting, physical meeting requisitions, appeals, SIP 6 and case law

Published by a LexisNexis Restructuring & Insolvency expert

Practice notes

The Insolvency (England and Wales) Rules 2016 (IR 2016), SI 2016/1024, set out a refreshed framework for decision-making across all insolvency processes from 6 April 2017. The specific mechanics appear in IR 2016, SI 2016/1024, Pt 15. Although IR 2016, SI 2016/1024 describes decisions to be taken by creditors and the steps creditors must follow, r 15.2(3) provides that these decision procedures also apply, with appropriate adjustments, to contributories where they are called upon to decide. Where a decision is sought from contributories, voting value is determined by the percentage of voting rights in accordance with IR 2016, SI 2016/1024, r 15.39...

The qualifying decision procedures

There are five procedures by which the person seeking a decision (the convener) may obtain one under sections 246ZE and 379ZA of the Insolvency Act 1986 (IA 1986):

by correspondence
via electronic voting
through a virtual meeting
at a physical meeting
or any other decision-making process that permits equal participation by all creditors

The convener must give notice of the decision procedure to every creditor...

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Richard Bowles

Richard was called to the bar in 2014 and practices from Three Stone in Lincoln’s Inn. His practice encompasses a wide variety of chancery and commercial work with an emphasis on insolvency; trusts; real property; landlord and tenant; and commercial matters.Richard is regularly instructed to appear in the High Court and County Court, as well as undertaking a wide range of drafting and advisory work in all areas of Chambers’ expertise. He has appeared, both as sole advocate and as junior counsel, in trials in the High Court and County Court, and as both Applicant and Respondent in numerous urgent injunction applications in the High Court....

Web page updated on 21/05/2026

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