Insurance (No. 2) Act, 1983

Power of administrator and court.

3.—(1) Subject to the provisions of this Act and, in particular, to the functions conferred on an administrator by section 2 of this Act—

(a) an administrator (whether appointed under subsection (2) or (4) of section 2 of this Act) shall as on and from his appointment have all the powers (including the power to sell the real and personal property and things in action of the insurer concerned) that he would have, and there shall apply in relation to him all the statutory provisions that would so apply, if he were a liquidator appointed by the court in respect of the insurer and (in a case where the insurer is not a company) the insurer were a company, and

(b) where an administrator stands appointed (whether under subsection (2) or (4) of section 2 of this Act), the court shall have under this Act all the powers that it would have if it had made a winding up order and appointed a liquidator in respect of the insurer concerned and (in a case where the insurer is not a company) the insurer were a company, and

(c) where a petition is presented to the court for an order for administration or the appointment of an administrator, the court shall thereupon have under this Act all the functions that it would have if a petition had been presented to it for the winding up of the insurer concerned,

and the provisions of the Companies Acts, 1963 to 1983, and any instruments made thereunder and, in particular, the provisions of those Acts and instruments relating to the winding up of companies by the court and to liquidators of companies shall apply and have effect accordingly in relation to the powers and functions aforesaid with the modifications specified in this subsection, in the Schedule to this Act and in any order under subsection (6) of this section and with any other necessary modifications:

Provided that, save as otherwise specified in this section—

(i) the business of the insurer concerned shall be continued without interruption as a going concern and no contract (including a contract of employment or service), policy, transaction, bank account or bank mandate, right, title, claim, debt, proceeding or obligation of the insurer or right, claim or proceeding against the insurer, shall be avoided, cancelled, stayed or otherwise affected by reason only of the order for administration or the appointment of the administrator or the application to the insurer of the provisions of the said Acts and instruments, and

(ii) the provisions of sections 131, 132, 159, 161, 218, 219 and 222, paragraphs (a) to (f) of section 228 and sections 231 (3), 234 , 283 , 284 , 285 , 291 , 292 , 302 and 306 of the Companies Act, 1963 (as amended), shall not apply.

(2) For so long as an administrator stands appointed under this Act, the following provisions shall have effect—

(a) no proceedings or resolution for the winding up of the insurer concerned shall be commenced or passed without the prior sanction of the court obtained under this section,

(b) no receiver over any part of the property or undertaking of the insurer shall be appointed without the prior sanction of the court obtained under this section,

(c) no petition for relief under section 205 of the Companies Act, 1963 , shall be presented or proceeded with against the insurer except to the extent that such petition is grounded exclusively upon complaints as to the conduct of the affairs of the insurer or the exercise of the powers of the directors of the insurer prior to the appointment of the administrator,

(d) no attachment, sequestration, distress or execution shall be put into force against the property or effects of the insurer without the prior sanction of the court obtained under this section,

(e) the words “under administration” shall be used in relation to the name of the insurer in all circumstances in which the words “in liquidation” would fall to be used in relation to the name of a company being wound up by the court,

(f) the functions of the administrator may be performed by him with the assistance of persons appointed or employed by him for that purpose,

(g) all functions which are vested in the directors or in any committee of management of the insurer (whether by virtue of the memorandum or articles of association of the insurer or by law or otherwise) shall be performable only by the administrator and all such powers of the insurer as are exercisable by or with the sanction of a general meeting of the members of the insurer shall be exercisable only by the administrator and such exercise shall be subject to the sanction of the court,

(h) the administrator may apply to the court to determine any question arising in the course of the administration of the insurer, or for the exercise in relation to the insurer of all or any of the powers which the court may exercise under the Companies Acts, 1963 to 1983, upon the application to it of any member, contributory, creditor, director or liquidator of a company including those powers which a court may exercise in the winding up of a company,

(i) the administrator may resign or, upon the application of the Minister, be removed by the court for cause shown, and

(j) a vacancy in the office of administrator may be filled by the court upon the nomination of the Minister.

(3) (a) If the court so declares, the administrator shall not be bound, or shall be bound only to the extent or in the manner specified in the declaration, by any rule, regulation or other provision of the insurer concerned (whether contained in the memorandum or articles of association of the insurer or in any other document relating to the constitution of the insurer or in any agreement or in any other document whatsoever) restricting or defining the classes or categories of persons to whom the insurer may issue policies or the terms upon which it may issue policies.

(b) A declaration under this subsection (including this paragraph) may be varied or annulled by the court, and—

(i) if the declaration is so varied, the administrator concerned shall be bound by the rule, regulation or other provision concerned, as the case may be, in accordance with the said declaration as so varied, and

(ii) if the declaration is annulled, the administrator shall be bound by the rule, regulation or other provision concerned, as the case may be.

(4) (a) The costs and expenses of the performance of the functions of an administrator appointed under this Act and his remuneration shall be paid, and the administrator shall be entitled to be indemnified in respect thereof and to retain the same from time to time, out of the revenue of the business of the insurer or the proceeds of the realisation of the assets (including investments) or other funds available to the insurer,

(b) the court shall, from time to time on the application of the administrator, by order fix the amount or the basis of calculation of the amount of the costs, expenses and remuneration of the administrator and such order may extend to a period prior to the date of the making of the order, and

(c) the administrator shall within six weeks of each anniversary of his appointment (or at such other times as the court may direct) deliver to the court a summary of the sums received or retained by him in each year for the costs and expenses of the administration and for his remuneration.

(5) A provision of the Companies Act, 1963 , specified in column (2) of the Schedule to this Act at any reference number shall apply and have effect, for the purposes of subsection (1) of this section, with the modifications specified in column (3) of that Schedule at that reference number.

(6) (a) Without prejudice to the generality of subsection (1) of this section, the Minister may, for the purpose of giving full effect to the application by that subsection of the provisions of the Companies Acts, 1963 to 1983, and any instruments made thereunder, by order modify the provisions of the said Acts or any rules or other instruments made thereunder or any rules of court relating thereto in their application under and for the purposes of this Act if he considers it necessary or appropriate to do so to facilitate the performance of the functions of an administrator appointed under this Act.

(b) The Minister may by order revoke or amend an order made under this subsection including this paragraph.