Personal Insolvency (Amendment) Act 2015
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Amendment of section 119 of Principal Act | ||
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22. The Principal Act is amended by the substitution of the following for section 119 (as amended by section 89 of the Courts and Civil Law (Miscellaneous Provisions) Act 2013 ): | ||
“119. (1) Subject to this section and section 119A, a Personal Insolvency Arrangement may be varied in accordance with its terms. | ||
(2) A personal insolvency practitioner, whether on his or her own initiative or on a request made in accordance with subsection (3), shall propose a variation of a Personal Insolvency Arrangement (in this section referred to as a ‘variation’) where— | ||
(a) it appears to the personal insolvency practitioner that there has been a material change in the debtor’s circumstances, and | ||
(b) the personal insolvency practitioner is satisfied that there is a reasonable prospect that a variation that addresses such circumstances would be approved in accordance with this section. | ||
(3) A debtor or creditor who is bound by a Personal Insolvency Arrangement may request the personal insolvency practitioner to propose a variation of the Arrangement, which request shall be— | ||
(a) in writing, | ||
(b) accompanied by information or evidence to support the assertion that there has been a material change in the debtor’s circumstances, and | ||
(c) accompanied by the written consent of the person making the request to the— | ||
(i) making by the personal insolvency practitioner of an enquiry under subsection (4), and | ||
(ii) disclosure by the personal insolvency practitioner of personal data of the person, to the extent necessary for such an enquiry. | ||
(4) A personal insolvency practitioner shall, within 21 days of receipt of a request under subsection (3), decide whether paragraphs (a) and (b) of subsection (2) apply in relation to the Personal Insolvency Arrangement concerned, and, for that purpose— | ||
(a) may request any further information he or she requires from the person who made the request, and | ||
(b) may make such enquiries as he or she considers necessary in order to arrive at his or her decision. | ||
(5) For the purpose of deciding, whether under subsection (4) or otherwise, whether paragraphs (a) and (b) of subsection (2) apply in relation to the Personal Insolvency Arrangement concerned, the personal insolvency practitioner may require the debtor concerned, where necessary with the assistance of the personal insolvency practitioner, to complete a new Prescribed Financial Statement. | ||
(6) Where the personal insolvency practitioner is satisfied that paragraphs (a) and (b) of subsection (2) apply in relation to the Personal Insolvency Arrangement concerned, he or she shall without delay— | ||
(a) require the debtor concerned, where necessary with the assistance of the personal insolvency practitioner, to complete a new Prescribed Financial Statement, unless the debtor has completed a Prescribed Financial Statement under subsection (5) and the information contained in it remains complete and accurate, | ||
(b) formulate a proposal for a variation, | ||
(c) seek the written consent of the debtor to the proposal and, subject to subsection (8), to the calling of a meeting of the creditors of the debtor for the purpose of considering the proposal, and | ||
(d) subject to subsection (8), where the consent of the debtor referred to in paragraph (c) has been given, arrange for the holding of the meeting referred to in that paragraph. | ||
(7) When calling a creditors’ meeting to be held under this section, the personal insolvency practitioner shall— | ||
(a) give each creditor at least 14 days’ written notice of the meeting and the date on which, and the time and place at which, the meeting will be held, | ||
(b) ensure that the notice referred to in paragraph (a) is accompanied by— | ||
(i) a written proposal for the variation of the Personal Insolvency Arrangement, | ||
(ii) a report of the personal insolvency practitioner— | ||
(I) describing the outcome for the creditors and for the debtor under the terms of the proposal, and | ||
(II) indicating whether or not he or she is of the opinion that the debtor is reasonably likely to be able to comply with the terms of the Personal Insolvency Arrangement as varied in accordance with the proposal, | ||
(iii) the Prescribed Financial Statement completed by the debtor under subsection (5) or (6), as the case may be, and | ||
(iv) such other information obtained by the personal insolvency practitioner under this section as he or she considers relevant, | ||
and | ||
(c) lodge a copy of the notice referred to in paragraph (a) and the documents referred to in paragraph (b) with the Insolvency Service. | ||
(8) Where only one creditor would be entitled to vote at a creditors’ meeting under this section (whether in respect of one or more debts), the personal insolvency practitioner shall, in place of holding such a meeting, give notice to the creditor of the proposal for a variation, and paragraphs (b) and (c) of subsection (7) shall apply in respect of that notice. | ||
(9) The provisions of sections 99 to 105 and sections 108 to 115 (other than subsections (2) and (3) of section 101, sections 108(9), 109(6), 111A(7) (inserted by section 17 of the Personal Insolvency (Amendment) Act 2015), 112(1) (c)(i) (as amended by section 18 (a) of the Personal Insolvency (Amendment) Act 2015), 112(1A)(c)(i) (inserted by section 18 (b) of the Personal Insolvency (Amendment) Act 2015), 113(2), 114(3), and 115(2)(a)(i)) and section 120 shall apply in relation to a variation of a Personal Insolvency Arrangement under this section, subject to the following modifications and any other necessary modifications— | ||
(a) a reference to a Personal Insolvency Arrangement shall be construed as a reference to a Personal Insolvency Arrangement as varied in accordance with this Chapter, | ||
(b) a reference to a proposal for a Personal Insolvency Arrangement shall be construed as a reference to a proposal for the variation of a Personal Insolvency Arrangement, and a reference to a proposed Personal Insolvency Arrangement shall be construed as a reference to a proposed variation of a Personal Insolvency Arrangement, | ||
(c) a reference to a Prescribed Financial Statement shall be construed as a reference to the Prescribed Financial Statement completed by the debtor under subsection (5) or (6), as the case may be, | ||
(d) the variation of a Personal Insolvency Arrangement shall not have the effect of extending the duration of that Personal Insolvency Arrangement beyond the maximum duration permitted under section 99(2)(b), | ||
(e) a Personal Insolvency Arrangement as varied under this section shall, in addition to containing the information referred to in section 99(2)(f), make provision for the costs and outlays of the personal insolvency practitioner which relate to this section, | ||
(f) a reference to a notification that a protective certificate has been issued shall be construed as a reference to a notice under subsection (7) of the calling of a creditors’ meeting, | ||
(g) a reference to the day or date on which a protective certificate is issued, other than in section 102(7), shall be construed as a reference to the date on which a vote at the creditors’ meeting under this section is held, | ||
(h) where section 103(3) applied to a Personal Insolvency Arrangement, the variation of that Arrangement shall not operate to alter the period referred to in section 103(11)(a), | ||
(i) a reference to the market value attributed to security, or the market value of security determined, in accordance with section 105 shall be construed as the value attributed or determined in accordance with section 105 for the purpose of a variation under this section, | ||
(j) a reference to a creditors’ meeting shall be construed as a reference to a creditors’ meeting under this section, | ||
(k) where section 108(4) applied to a creditor, that subsection shall continue to apply to that creditor for the purpose of his or her voting rights at a creditors’ meeting under this section, | ||
(l) a debt that is an unsecured debt on the date on which the vote at a creditors’ meeting under this section is held shall be treated as an unsecured debt, notwithstanding that the debt concerned was a secured debt when the vote on the proposal for the Personal Insolvency Arrangement concerned was held, | ||
(m) an adjournment pursuant to section 109(4) may occur once only in the course of a creditors’ meeting, and | ||
(n) a reference in section 115(5)(c) (as amended by section 20 (b) of the Personal Insolvency (Amendment) Act 2015) to section 111A(7) shall be construed as a reference to subsection (10). | ||
(10) (a) Where subsection (8) applies, the creditor concerned shall notify the personal insolvency practitioner in writing of his or her approval or otherwise of a proposal for the variation of a Personal Insolvency Arrangement within— | ||
(i) 14 days of the giving to him or her of the notice under that subsection, or | ||
(ii) if later, 7 days of the date on which a notice under section 111A(4)(a) is first given to him or her. | ||
(b) A proposal referred to in paragraph (a) — | ||
(i) shall be considered as having been approved by the creditor concerned where that creditor notifies the personal insolvency practitioner in accordance with that paragraph of the creditor’s approval of the proposal, and | ||
(ii) where that creditor fails to comply with that paragraph, shall be deemed to have been approved by the creditor concerned. | ||
(11) Where— | ||
(a) on the taking of a vote at a creditors’ meeting under this section, the proposal is not approved in accordance with section 110, | ||
(b) subsection (8) applies and the proposal is not approved in accordance with subsection (10), or | ||
(c) the appropriate court upholds the objection of a creditor to the variation of a Personal Insolvency Arrangement coming into effect, | ||
the Personal Insolvency Arrangement concerned shall, without prejudice to the other provisions of this Act, continue in effect without being subject to such variation. | ||
(12) Subsection (11) shall be without prejudice to the entitlement of the personal insolvency practitioner to propose another variation of the Personal Insolvency Arrangement in accordance with this section. | ||
(13) Subject to subsection (14), an unreasonable refusal by the debtor to give his or her consent— | ||
(a) under subsection (6) to a proposal for a variation or the calling of a creditors’ meeting, | ||
(b) under section 119A(3) to a proposal for a variation or the giving to creditors of a notice under section 119A(4), or | ||
(c) under subsection (3) or (4) of section 109 or, as the case may be, subsection (3) or (5) of section 111A (inserted by section 17 of the Personal Insolvency (Amendment) Act 2015), | ||
shall be grounds for an application under section 122(1)(g). | ||
(14) A debtor who refuses to give his or her consent under a provision referred to in subsection (13) shall be considered to be acting reasonably where the proposal in relation to which the consent is sought would require the debtor— | ||
(a) where there has been an increase in the debtor’s income, to make additional payments in excess of 50 per cent of the increase in his or her income available to him or her after the following deductions (where applicable) are made: | ||
(i) income tax; | ||
(ii) social insurance contributions; | ||
(iii) payments made by him or her in respect of excluded debts; | ||
(iv) payments made by him or her in respect of excludable debts that are not permitted debts; | ||
(v) such other levies and charges on income as may be prescribed, | ||
or | ||
(b) to make a payment amounting to more than 50 per cent of the value of any property acquired by the debtor after the coming into effect of the Personal Insolvency Arrangement that is proposed to be varied, unless receipt of that property had been anticipated by the terms of that Arrangement. | ||
(15) A reference in this Chapter to a Personal Insolvency Arrangement shall be construed as including such an arrangement as proposed to be varied or as varied in accordance with this section or section 119A, unless the context otherwise requires. | ||
(16) In this section, ‘material change in the debtor’s circumstances’ means a change in the debtor’s circumstances that would materially affect his or her ability to make payments, or otherwise perform his or her obligations, under the Personal Insolvency Arrangement, and includes an increase or decrease in the extent of the debtor’s assets, liabilities or income. | ||
Variation of Personal Insolvency Arrangement confirmed by order under section 115A | ||
119A. (1) Where the coming into effect of a Personal Insolvency Arrangement has been confirmed by an order of the court under section 115A(9), the Arrangement may be varied in accordance with its terms and subject to this section. | ||
(2) Subsections (2) to (5), and paragraphs (a) and (b) of subsection (6), of section 119 shall apply to the variation of a Personal Insolvency Arrangement under this section. | ||
(3) Where the personal insolvency practitioner has, in accordance with section 119(6)(b), formulated a proposal for the variation of the Personal Insolvency Arrangement concerned, he or she shall without delay— | ||
(a) seek the written consent of the debtor to the proposal and to the giving of a notice under subsection (4) to the creditors concerned, and | ||
(b) give each creditor concerned a notice under subsection (4). | ||
(4) A notice under this subsection shall— | ||
(a) inform the creditor of the proposal for a variation of the Personal Insolvency Arrangement, | ||
(b) be accompanied by— | ||
(i) a written proposal for the variation of the Personal Insolvency Arrangement, | ||
(ii) a report of the personal insolvency practitioner— | ||
(I) describing the outcome for the creditors and for the debtor under the terms of the proposal, and | ||
(II) indicating whether or not he or she is of the opinion that the debtor is reasonably likely to be able to comply with the terms of the Personal Insolvency Arrangement as varied in accordance with the proposal, | ||
(iii) the Prescribed Financial Statement completed by the debtor under section 119(5) or (6), as the case may be, | ||
(iv) a statement informing the creditor of the effect of subsections (7), (8), (9) and (12), and | ||
(v) such other information obtained by the personal insolvency practitioner under this section as he or she considers relevant. | ||
(5) The personal insolvency practitioner shall lodge a copy of a notice under subsection (4) and the documents referred to in paragraph (b) of that subsection with the Insolvency Service. | ||
(6) The provisions of sections 99 to 105 (other than subsections (2) and (3) of section 101) and section 120 shall apply in relation to a variation of a Personal Insolvency Arrangement under this section, subject to the following modifications and any other necessary modifications— | ||
(a) a reference to a Personal Insolvency Arrangement shall be construed as a reference to a Personal Insolvency Arrangement as varied in accordance with this Chapter, | ||
(b) a reference to a proposal for a Personal Insolvency Arrangement shall be construed as a reference to a proposal for the variation of a Personal Insolvency Arrangement, and a reference to a proposed Personal Insolvency Arrangement shall be construed as a reference to a proposed variation of a Personal Insolvency Arrangement, | ||
(c) a reference to a Prescribed Financial Statement shall be construed as a reference to the Prescribed Financial Statement completed by the debtor under section 119(5) or (6), as the case may be, | ||
(d) the variation of a Personal Insolvency Arrangement shall not have the effect of extending the duration of that Personal Insolvency Arrangement beyond the maximum duration permitted under section 99(2)(b), | ||
(e) a Personal Insolvency Arrangement as varied under this section shall, in addition to containing the information referred to in section 99(2)(f), make provision for the costs and outlays of the personal insolvency practitioner which relate to this section, | ||
(f) a reference to a notification that a protective certificate has been issued shall be construed as a reference to a notice under subsection (4), | ||
(g) a reference to the day or date on which a protective certificate is issued, other than in section 102(7), shall be construed as a reference to the date of the giving to the creditor of a notice under subsection (4), | ||
(h) where section 103(3) applied to a Personal Insolvency Arrangement, the variation of that Arrangement shall not operate to alter the period referred to in section 103(11)(a), and | ||
(i) a reference to the market value attributed to security, or the market value of security determined in accordance with section 105, shall be construed as the value attributed or determined in accordance with section 105 for the purpose of a variation under this section. | ||
(7) A creditor shall, within 14 days of the giving to the creditor of a notice under subsection (4), notify the personal insolvency practitioner in writing of his or her approval or otherwise of the proposal for the variation of the Personal Insolvency Arrangement. | ||
(8) Where a creditor fails to comply with subsection (7), the creditor shall be deemed to have approved the proposal concerned. | ||
(9) Where a creditor notifies the personal insolvency practitioner in accordance with subsection (7) that the creditor does not approve of the proposal, the personal insolvency practitioner may, if the debtor so instructs him or her in writing, make an application on behalf of the debtor to the appropriate court for an order confirming the coming into effect of the Personal Insolvency Arrangement as varied in accordance with the proposal (in this section referred to as ‘an order under this section’). | ||
(10) Where subsection (9) applies and the personal insolvency practitioner does not make an application in accordance with this section, the Personal Insolvency Arrangement concerned shall, without prejudice to the other provisions of this Act, continue in effect without being subject to such variation. | ||
(11) Subsection (10) shall be without prejudice to the entitlement of the personal insolvency practitioner to propose another variation of the Personal Insolvency Arrangement in accordance with this section. | ||
(12) Where no creditor notifies the personal insolvency practitioner in accordance with subsection (7) that the creditor does not approve of the proposal, the personal insolvency practitioner shall notify the Insolvency Service in writing of that fact. | ||
(13) An application for an order under this section shall be made not less than 14 days after receipt by the personal insolvency practitioner of the notice of the creditor referred to in subsection (9) and shall be— | ||
(a) on notice to the Insolvency Service, each creditor concerned and the debtor, and | ||
(b) accompanied by— | ||
(i) a copy of the documents referred to in subsection (4) (b), | ||
(ii) a copy of the notification by the creditor referred to in subsection (9), and | ||
(iii) a statement of the grounds of the application which shall include (other than where the Personal Insolvency Arrangement that is proposed to be varied is an Arrangement to which section 111A applied) a statement identifying the creditor or creditors who, having approved or being deemed to have approved, in accordance with this section, the proposal, should, in the opinion of the personal insolvency practitioner, be considered by the court to be a class of creditors for the purpose of this section, and giving the reasons for this opinion. | ||
(14) Section 115A(6) to (9) shall apply in relation to an application under this section, subject to the following modifications and any other necessary modifications— | ||
(a) a reference to a proposed Personal Insolvency Arrangement shall be construed as a reference to a proposal for the variation of a Personal Insolvency Arrangement, | ||
(b) a reference to an order under section 115A(9) shall be construed as a reference to an order under this section, and | ||
(c) a reference in section 115A(9) (g) to a class of creditors having accepted a proposed Arrangement shall be construed as a reference to a class of creditors having approved, or being deemed to have approved, in accordance with this section, a proposal for the variation of a Personal Insolvency Arrangement. | ||
(15) The registrar of the appropriate court shall notify the Insolvency Service and the personal insolvency practitioner concerned where the court makes or refuses to make an order under this section. | ||
(16) The Insolvency Service shall register in the Register of Personal Insolvency Arrangements the variation of a Personal Insolvency Arrangement on receipt by it of a notification under— | ||
(a) subsection (12), or | ||
(b) subsection (15) of the making of an order under this section. | ||
(17) The variation of a Personal Insolvency Arrangement under this section shall come into effect upon being registered in the Register of Personal Insolvency Arrangements. | ||
(18) The court, in an application under this section, shall make such other order as it deems appropriate, including an order as to the costs of the application.”. |