February 2013PART 1
GENERAL AND UNUSUAL ASSETS
Section A - Aircraft
31.10.1 Definition of aircraft
For the purpose of this chapter and the guidance given therein the term aircraft can be taken to cover aeroplanes, helicopters, hot-air balloons, airships and gliders.
31.10.2 Aircraft registration
With very limited exceptions, all civil aircraft using the skies of the United Kingdom are required to carry a unique mark [note 1]. Exceptions include historic aircraft with historic or military markings - which are authorised by the Ministry of Defence. Usually, the unique mark is a group of five letters of which the first identifies the country in which the aircraft is registered (for example, G for the United Kingdom) and the other four letters are allocated by the Civil Aviation Authority (CAA) on registration of the aircraft. A particular registration mark can be reserved in advance of its application to an aircraft but there is no market in transferring these marks (in the same way as “personalised” car registration numbers are bought and sold) as a mark can only ever be applied to one airframe.
31.10.3 Searchable record of aircraft registration
The Civil Aviation Authority (CAA) maintains a register of aircraft registered in the United Kingdom [note 2] which is available for inspection by any person (after payment of the requisite charge where applicable). The CAA register is accessible on-line (click HERE) and lists the registration mark, aircraft type, serial number and owner. In addition, it gives details of the previous identity (if any) of the aircraft, whether it is currently registered or not, the date of registration, manufacturer, class of aircraft, number of engines, maximum take-off weight, total hours flown, year built and date of issue of certificate of airworthiness. The UK register of Civil Aircraft is not a register of legal ownership and the details on the register do not confirm legal title and the official receiver will need to confirm ownership by reference to other documentation.
31.10.4 “Personalised” aircraft registration marks
A registration mark may only be used once and cannot be applied to another aircraft even in circumstances where the original aircraft is destroyed or exported. This being the case there is no market for unusual or “personalised” registration marks.
31.10.5 Aircraft mortgages
An aircraft registered in the UK register (see paragraph 31.10.2 above) may be made security for a loan or other valuable consideration [note 3]. The Civil Aviation Authority (CAA) maintains a register of aircraft mortgages into which a mortgagee may apply to have a mortgage registered [note 4]. The mortgage may relate to a stock of spare parts kept for the aircraft but does not otherwise include a mortgage created as a floating charge [note 5]. A registered charge does not construe priority over a possessory lien in respect of work done on the aircraft (whether before or after the registration of the mortgage) on the express or implied authority of any persons lawfully entitled to possession of the aircraft or over any right to detain the aircraft under any Act of Parliament [note 6]. The register is available for public search on application to the following [note 7]:
Aircraft Registration Section
Tel: 020 7453 6666
Fax: 020 7453 6670
The current prescribed form to use when applying to search the register is CA350, which can be downloaded from the CAA website by clicking (HERE). The fee payable is currently £29. The form once downloaded can be completed and returned by post or scanned and emailed to the address above. If a certified copy is required this can also be provided for a further fee of £29.
31.10.6 Airport charges and the detention and sale of aircraft
Fees are charged by airport operating companies to individual aircraft relating to the aircraft’s use of the airport. Charges vary depending on factors such as the type of aircraft and the time of the departure or arrival. An airport operator may detain an aircraft that is in default relating to airport charges whether or not the charges were incurred by the person who is the operator of the aircraft at the time of detention [note 8]. The power to detain extends to equipment and stores carried by the aircraft and allows the aircraft to be detained at any other airport owned by the same operating company. The aircraft operator is allowed 56 days to pay the outstanding charges, or provide sufficient security, after which the airport operator may apply for leave of Court to sell the aircraft [note 9].
In the event that the official receiver becomes aware that an aircraft owned by an insolvent has been, or is likely to be, detained due to unpaid charges consideration should be given to paying the outstanding charges if they are less than the value of the aircraft. The official receiver will need to obtain a specialist valuation of the aircraft and a search of the internet should assist in locating details of an agent that specialises in the valuation and sale of aircraft.
If, after the prescribed 56 days, the charges for which an aircraft has been detained remain outstanding, the detainor may apply to court for an order to sell the aircraft [note 10]. In advance of making the application to court the detainor must serve notice on interested parties and give them the opportunity to be joined in the proceedings [note 11]. On becoming aware that an aircraft belonging to an insolvent has been, or is likely to be, detained, the official receiver should immediately inform the detainor of his/her interest in the aircraft. The order of payment from any subsequent sale of the aircraft is set out in the legislation [note 12] and the official receiver should monitor the sale and distribution to ensure that any payment due is received.
31.10.7 Navigation charges
In the UK the CAA levies charges against aircraft operators for the provision of air navigation (air traffic control) services [note 13]. Regulations relating to the procedures for the detention of aircraft [note 14] and [note 15] whose operators have outstanding payments in this respect are largely the same as those relating to outstanding airport charges, and the guidance outlined in paragraph 31.10.6 should be followed. The CAA has the power to detain aircraft in respect of outstanding air navigation charges [note 16] . Where the official receiver is aware he/she has an interest in a detained aircraft , notice of this interest should be sent to the CAA, whose address and contact details can be found at the following links, for all aspects of CAA safety regulation and consumer protection, ownership, control and general licensing matters:
CAA Main switchboard telephone number: 020 7379 7311
31.10.8 Sale of an aircraft
The CAA must be informed of any change in the ownership of an aircraft [note 17]. The notification of registration must be completed within 28 days of the change in ownership [note 18].
The original Certificate of Registration must be returned to the CAA for amendment where the aircraft is transferred to a new owner or the owner’s address changes. If the original certificate is not available (or has been lost or destroyed) the CAA should be notified using the Address Change Form available on the website, to allow the CAA to issue a new Certificate. There is no charge for the re-issue of a Certificate of Registration for an address change.
Section B – Charged assets
31.10.9 Charged Assets
It is unlikely that the official receiver will become involved in the realisation of assets that are subject to a charge. Where assets are charged the official receiver should make early contact with the charge-holder to establish their intentions with regards to the charged asset. If the charge-holder is unwilling to appoint a receiver under the terms of its charge, or otherwise deal with the asset, then the official receiver should take steps to protect the asset(s) and deal with them in the usual way. It may be appropriate to seek the appointment of a liquidator or trustee other than the official receiver via a Secretary of State appointment [note 19] [note 20] (see Chapter 17 - Appointment of Liquidators and Trustees)
To verify the existence of charges and mortgages, the official receiver can refer to the following sources:
Patents – UK Patent Office (see Annex 1 paragraphs 55 and 59)
Plant Breeders’ Right – Plant Variety Rights Office (see Annex 1 paragraph 62)
Registered Designs – UK Patent Office (see Annex 1 paragraph 27)
Ships and boats – Registry of Shipping and Seamen (see paragraph 31.10.34)
Trade marks – UK Patent Office (see Annex 1 paragraphs 68 and 72)
Section C – Farming and agriculture
31.10.10 Farm Equipment and Stock
Guidance on dealing with farming equipment and stock can now be found in Chapter 31.6, specifically fixtures (and tenant’s fixtures) at paragraphs 31.6.95 to 31.6.99, and goods on hire at paragraph 31.6.100. Agricultural charges and tenancies are covered at Chapter 59 paragraphs 59.74a to 59.74g.
Section D – household and personally owned items
31.10.11 Household equipment – general exemptionSuch clothing, bedding, furniture or household equipment and provisions as are necessary for satisfying the basic domestic needs of the bankrupt and his/her family do not form part of the bankrupt’s estate [note 21].
Valuable furniture, such as antique furniture, which is being used by the bankrupt, could be claimed by the trustee as exempt property of excess value [note 23] (see Chapter 30 Exempt Property). Only where furniture is of sufficient value to merit sale should insurance be obtained.
31.10.12 Household items and furniture not required for bankrupt’s domestic needs
It is possible that a bankrupt owns furniture or household equipment that is not required for his/her basic needs, such as furniture in a room let to a lodger or in another property owned by the bankrupt but let to a third-party. It is unlikely that the second hand value of such furniture would be sufficient to warrant its removal and sale. It may be possible to offer the items for sale in-situ to a member of the bankrupt’s family or other interested party. If a member of the bankrupt’s family claims any of the furniture, they may claim it by completing form ATPC [note 22].
31.10.13 Valuation of household equipment
In deciding whether it is appropriate to sell furniture or household equipment, the official receiver may consider establishing an approximate market value by referring to internet sites, for example www.ebay.co.uk. With regard to antique furniture, a specialist agent may need to be employed.
Clothing, unless it has a designer label, or is a collectors’ item, such as pop memorabilia or a unique antique item, is unlikely to be of sufficient value to be sold. In cases of doubt advice may be obtained from an agent or a specialist second-hand shop. Antique or other collectable clothing should be valued and sold by specialist agents.
In circumstances where a bankrupt is in possession of jewellery it may be appropriate to deal with the jewellery as an asset in the proceedings. This would depend on the value of the item and the likely costs of sale and, in this respect, agents (possibly a local jewellery shop) should be engaged to carry out a valuation.
In a case where the official receiver is taking possession of jewellery from a bankrupt or director, either at an inspection or during interview, a detailed receipt should be issued which should, in so far as is possible, describe the items collected. It is accepted that the collecting officer will be unable to verify the material from which the jewellery is made, or the quality or grade thereof and, therefore, the description should be phrased in general terms, such as:
“Yellow metal ring, said by X to be gold, with three clear stones, said by X to be diamonds.”
The receipt should be signed by the collecting officer and the person from whom the items are collected. Ideally, a copy should be left with the person giving up possession of the item.
Items collected should be passed to the official receiver’s agents for sale as soon as possible. When jewellery is collected outside the operational hours of the official receiver’s agents, it should be stored in the office safe pending collection by the agents. Adequate insurance should be obtained for items of high value.
Specialist agents should be employed to deal with the sale of antique jewellery or jewellery pieces of high value. The official receiver’s agents may be able to suggest a suitable firm or alternatively local jewellers may be able to assist.
31.10.16 Engagement Rings
The general principle is that an engagement ring constitutes a gift conditional on an event taking place (for example the marriage or civil partnership) and the ring does not pass as property to the recipient until the marriage has taken place [note 24][note 25].
If the bankrupt’s fiancé(e) can prove that the funds to purchase the bankrupt’s ring came from his/her own funds (rather than those of the bankrupt) then the ring will not form part of the estate. If he/she cannot prove this, or the marriage/civil ceremony took place before or during the period of bankruptcy, then the official receiver may claim an engagement ring held by the bankrupt as an asset or after-acquired asset – whichever is appropriate according to the date of the marriage/civil ceremony.
It follows that an engagement ring given by a bankrupt to his/her fiancé(e) may also be recoverable as an asset where the wedding or civil partnership has not taken place before the date of the bankruptcy order. Section 339(3)(b) also allows for a transaction given in consideration of marriage or the formation of a civil partnership to be claimed as a transaction at undervalue, as long as the transaction takes place within the relevant time as detailed at section 341. The transfer of an engagement ring by a bankrupt to his/her fiancé(e) or proposed civil partner might also be recovered as a disposition of property under section 284, where the transaction occurs between the date of the presentation of the petition and the vesting of the bankrupt’s estate in the trustee.
In all cases the ring should, of course, be of sufficient value to warrant the costs of sale, and official receivers should not take engagement rings as a matter of course. Where possible the best course of action may be to effect a sale of the ring to a family member or other third party introduced by the bankrupt for an agreed sum, according to the value of the ring as at the date of sale.
31.10.17 Wedding rings
Weddings rings constituting a simple gold band will generally have a low financial value. Consideration has been given to the symbolism of a wedding ring and, taking into account the circumstances in which a wedding ring is given, in most cases it is unlikely that it will be appropriate for the Official Receiver to claim a wedding ring as an asset in the bankruptcy.
In circumstances where the wedding ring appears to be considerably more intricate or unusual and may possess a high financial value (e.g. where it is set with precious stones) then the official receiver may consider obtaining a valuation of the wedding ring, and if of high value, selling the ring and providing sufficient funds to the bankrupt to purchase a replacement simple gold band.
Where the bankrupt does not wish to retain a wedding ring (possibly where he/she is divorced or their civil partnership has been dissolved) the official receiver can realise the wedding ring as appropriate.
31.10.18 Bankrupt’s own pet animal
It is highly unlikely that the bankrupt’s own pet animal will have any realisable value, unless it has a good pedigree.
If so, the official receiver should, in the first instance, establish if the bankrupt wishes to introduce a third party to purchase the animal from the estate. The third party should arrange for the valuation, conducted by a registered breeder or other specialist, on which the sale price should be based.
31.10.19 Firearms held by a bankrupt personally
It is an offence to be in possession of a firearm without the necessary certificate [note 26] and dealing in firearms is controlled by the local police force [note 27]. Apart from the obligation to hold a certificate, there are a number of other regulations surrounding the transfer of firearms, particularly as regards record keeping [note 28]. Where it is beneficial to the estate to realise the firearms, the official receiver should ensure that any agents appointed to deal with the sale are registered firearms dealers. The website of The Gun Trade Association Ltd (http://www.gtaltd.co.uk/) carries a list of registered firearms dealers, searchable by name and location.
If there is any doubt when dealing with a firearm, the advice of the local police firearms liaison officer should be sought.
31.10.20 Loans and advances
Chapter 31.1 deals with trade debts owed to an insolvent and the guidance in that chapter can be followed for monies owed to an insolvent which arise from loans made which are personal in nature. It is unlikely that there will be a written loan agreement but, if there is, it should be obtained so that the terms of the loan can be established and to support the debt collection agent’s recovery of the monies.
The Official Receiver should consider the appropriateness of the bankrupt or company making the loan during a period they may have been insolvent themselves as this may be misconduct relevant to a BRO or disqualification application.
31.10.21 Partnership assets
When a bankruptcy order is made against a member of a partnership one of the effects is to dissolve the partnership [note 29]. The Official Receiver will not be able to deal with the assets of the partnership unless an order has also been made against the partnership, or if the court so directs. The solvent member(s) of the partnership should be informed of the making of the winding-up order and asked to account to the Official Receiver for the bankrupt’s share in the partnership using form NMSP [note 30] available via ISCIS.
In the circumstances where there is a valid insolvency order against the partnership, or where directions have been issued by the court, the Official Receiver should deal with the assets in the usual way.
See also Chapter 53 – Partnerships.
31.10.22 A bankrupt’s personal correspondence as an asset
The possibility of a bankrupt’s personal correspondence having a monetary value is most likely to occur in public interest cases, but the principles outlined in this section may be relevant to bankruptcies in general.
A bankrupt’s estate is defined as being all property belonging to or vested in the bankrupt at the commencement of the bankruptcy [note 31]. Further, property is defined as including money, goods, things in action and land and property [note 32]. The trustee is under a duty to take possession of all books, papers and other records which belong to the bankrupt or are in his/her possession or under his/her control [note 33] and may at any time sell, destroy or otherwise dispose of books, papers or other records of the bankrupt [note 34].
It may appear, on the face of it, that the aforementioned can be taken to include personal correspondence and gives the trustee the right to sell the correspondence. However, in the case of Haig v Aitken  3 WLR 1117 [note 35] it was ruled that personal correspondence, whatever the subject matter, does not form part of the bankrupt’s estate within the definitions of the Insolvency Act 1986. It was further ruled that, while some of the correspondence may relate to affairs relevant to the administration of the bankrupt’s estate, that does not bring it within the definition of estate. The judgment equated a bankrupt’s personal correspondence to a right of action for damages for libel as being peculiarly personal to him/her and his/her life as a human being.
It is also possible that the removal and sale of a bankrupt’s personal correspondence may contravene the Convention for the Protection of Human Rights and Fundamental Freedoms (1953) article 8 which provides a right to respect for one’s “private and family life, his[her] home and his[her] correspondence.” This was considered in the case referred to above, but did not form part of the judgment. This aspect has not, otherwise, been considered in a court.
Section E – Scrap metal
Section F - Ships and boats
31.10.24 Definition of ships and boats
For the purpose of this chapter and the guidance given therein the terms ships and boats can be taken to include merchant shipping, pleasure craft, fishing boats, yachts and small craft, and can be taken to include both sea and ocean going vessels and vessels used on inland waterways.
31.10.25 Ship and boat registration
Ships and boats with a connection to Britain (usually through British, European Economic Area (EEA) or European Union (EU) ownership) may be registered with the UK Ship Register [note 36]. Registration is voluntary, but brings with it benefits such as easier passage through foreign ports, assistance with seafarers’ travel costs, threat level information and the protection of the Royal Navy.
Fishing boats (with the exception of salmon cobles, boats which are 10 metres or less in length without an engine, or boats which are 10 metres or less in length which are used to catch only common eels) [note 37][note 38] are not allowed to fish for profit unless they are on the UK register or the register of another country. A mortgage may not be registered against a vessel unless the vessel is recorded on the register.
At registration, the ship is given a port of choice, which is the port from which the vessel usually operates. This is chosen by the person applying for registration.
A registered ship may be owned outright by one person, or divided into a maximum of 64 shares. A share may be owned by up to five people or companies. Joint owners of a share are considered to be one person [note 39].
31.10.26 Official number
Following registration of the boat or ship it is allocated a registration number (known as the official number) [note 40], which is then carved on the main beam or, if there is no main beam, another readily accessible part of the vessel [note 41]. On commercial ships this is normally found on the aft side of the forward beam of the main hatch and a note of the tonnage will be found in the same place.
A registered ship must also have a name, in roman letters, which is different from any other ship in the same part of the register. In addition, fishing boats must have a different name from any other boat or ship that operates from the same port of choice [note 42].
31.10.27Mortgaging A registered ship, or a share in a registered ship may be made security for the repayment of a loan [note 43]. The mortgagee may apply to have the mortgage registered with the Registry of Shipping and Seamen [note 44] (see paragraph 31.10.25).
31.10.28 Searching the UK Ship Register
Whilst the UK Ship Register does not constitute proof of ownership of a ship, the details available on the register may assist the official receiver in ascertaining ownership where this is unclear. The UK Ship Register is part of the Maritime and Coastguard Agency (MCA). A search of the register may be made by contacting the relevant MCA office (see contacts below) and completing an application to search the register.
Extracts from the register are known as transcripts and the current prescribed fees for the issue of a transcript are £21 for a current transcript or £32 for a historical transcript. The register contains details of the ship’s name and number, its owners, and of any mortgage against the vessel.
Contact Details as follows:
A to Z listing of topics relating to shipping available on the MCA website
(ii) Email, postal addresses and telephone numbers:
UK Ship Register
105 Commercial Road
Tel: +44 (0)23 8032 9197
Fax: +44 (0)23 8032 9447
Tel: 029 2044 8800
Fax: 029 2044 8820
(iii) Email and telephone numbers for different vessels:
(iv) Email enquiries concerning seafarers can be sent using the following address:
A ship may be detained by a number of different authorities (such as the Royal Navy or the Coast Guard) for a number of different reasons (such as unsafe working practices, being a dangerous vessel or breach of pollution controls). In the event that the Official Receiver becomes aware that a ship belonging to an insolvent has been, or is likely to be, detained an attempt should be made to identify the location of the ship and the identity of the detaining authority. Consideration can then be given to the costs of having the ship released against the likely value to the estate. Due to the varied nature of the law in this regard, official receivers may wish to seek the advice of Technical Section before proceeding.
31.10.30Selling a ship
To sell a ship or share(s) in a ship, a bill of sale under the prescribed format should be produced to the registrar [note 45]. The current prescribed form to use is the MSF4705 available HERE. When completed this form should be sent, together with the appropriate fee (currently £80) and supporting documents (if required) to: Registry of Shipping & Seamen, PO Box 420, Cardiff, CF24 5XR.
In addition to this, any changes to the ship (such as name or tonnage), or the port of operation, must be notified to the registrar in writing.
31.10.31Lake Windermere boat registration scheme
Lake Windermere in the Lake District in Cumbria has a parallel registration system for all boats with engines or outboard motors using the lake, be they boats available for hire on the lake, boats kept on the lake or boats brought to the lake to use. All such boats must be registered before use with the Windermere Registration Scheme, even those with a Small Ships Register number, which since April 2011 does not provide any exemption from the Windermere Registration Scheme. The other lakes in the Lake District do not operate similar schemes. The reason for this is that the Windermere scheme is primarily in place to allow the enforcement of speed limits relating to powered craft and, historically, there have been fewer powered boats using other Lake District lakes.
Further details can be obtained from:
Kendal LA9 7RL
31.10.32Sale of a vessel registered under the Windermere Registration Scheme
Where a boat registered under the Windermere Registration Scheme is to be disposed of or sold to new owners, registered owners have a legal obligation to notify the registrar within 14 days of disposal or sale of the vessel. Details of the date of transfer and the name and address of the new owner should be emailed to firstname.lastname@example.org or written notification of the sale including these details can be sent by post to the Windermere Registration address in Kendal (see paragraph 31.10.31 above). Since 2012 the cost of re-registering a vessel in the name of a new owner has been £20.
31.10.33 Norfolk Broads
Any boat which is kept within the Broads Authority’s navigation area for more than 28 days must be registered with the authority (registration is free). The boat is then issued with an adhesive registration number which must be displayed on each side of the bow and on the stern. Any change in ownership of the boat is to be notified to the authority by both the buyer and seller. The registration number is not changed when the owners change. There are also short and annual visit tolls due respectively for periods up to and beyond 28 days within the toll year running 1 April to 31 March. Further details can be obtained from the Broads Authority website which can be accessed HERE.
Currently the Broads Authority head office is located at:
2 Gilders Way
Tel: (01603) 610734
With effect from 3rd December 2012 the Broads Authority's head office will be located at:
62-64 Thorpe Road
Tel: 01603 610734
31.10.34 Environment Agency
The Environment Agency operates a registration scheme for boats using waterways over which it has responsibility. These include most of the navigable rivers of the United Kingdom, along with the Royal Military Canal through Sussex and Kent. They record details of the owner of the boat and changes in ownership are notified to them. The scheme is administered from a number of centres, depending on which waterway is used by the vessel. Further information can be obtained from www.environment-agency.gov.uk/navigation.
31.10.35 (British Waterways trading as)Canal & River Trust and Scottish Canals
British Waterways ceased to exist on 2 July 2012. Instead, the Canal & River Trust was set up to administer and care for historic waterways in England and Wales, and British Waterways trading under the name “Scottish Canals” continues to administer and maintain the historic waterways of Scotland. issue licences for boats to use the United Kingdom’s canal system. They record, amongst other things, details of the owner of a boat and are notified of changes in ownership. Further information can be obtained from:
(ii) The Canal and River Trust website: http://canalrivertrust.org.uk/
Canal & River Trust
First Floor North,
500 Elder Gate
Milton Keynes MK9 1BB
Telephone: 0303 040 4040
For the Canal & River Trust contact page click HERE (this also provides contact details for all the local and regional English and Welsh Waterways Offices).
Emergency Contact Telephone: 0800 47 999 47
(to be used in the event of an emergency where lives or property are at risk or there is danger of serious environmental contamination)
(iii) Scottish Canals:
Caledonian Canal Office
Tel: 01463 725500
Crinan Canal Office
Tel: 01546 603210
Lowland Canals Office (Forth & Clyde, Monkland and Union Canals)
Tel: 0141 332 6936
Section G – Unpaid share capital
31.10.36 Unpaid calls on company shareholders
A contributory, or shareholder, of a company is liable to contribute to the assets of a company in the event of its winding-up [note 46]. Usually, this liability is limited to the cost of the shares purchased [note 47]. In most cases encountered by Official Receivers the contributories will have paid their liability in respect of their shareholding at the time of purchase or, if not, the liability will be of a nominal value only and further action will not be necessary.
Where there is a substantial sum outstanding, the Official Receiver, as liquidator, should take steps to recover the sums owed. In the first instance, the contributories’ ability and/or willingness to pay should be established. The directors or accountants of the company may be able to assist in this. However, as with any other debt recovery action, the true position may only be discovered when the contributories themselves are approached for payment.
Application should be made by letter to the contributories for the unpaid amounts. The letter should detail the amount unpaid on their shares and request payment or proposals for payment within a specified period. The contributory should also be made aware that failure to pay might result in the Official Receiver taking court action (see paragraph 31.10.37 regarding settling a list of contributories).
31.10.37 Settling a list of contributories – production of the list
The court has the power to settle a list of contributories [note 48]. Effectively, this means that a list of the contributories is drawn up in order that unpaid calls can be pursued. This power is delegated to the liquidator in the rules [note 49] and it is the duty of the liquidator, as an officer of the court, to settle a list and, with the court’s approval, rectify the register of members as necessary (where there have been changes to the list kept in the company’s statutory books) [note 50].
The list produced should identify the following [note 51]:
31.10.38 Settling a list of contributories - issuing notice of the list
Once the list has been drawn up (see paragraph 31.10.42), notice should be sent by the official receiver as liquidator to every person included in the list of creditors informing them that he/she has settled a list of contributories and giving them a chance to object to any entry in, or omission from, the list. The notice should contain details of the following [note 52][note 53]:
The notice should also inform the contributories that if they object to any entry in, or omission from, the list they should inform the liquidator in writing within 21 days of the notice [note 54].
31.10.39 Objections to the list of contributories
On receipt of any objection to an entry in, or omission from, the list of contributories the liquidator must consider the details of the objection and, within 14 days, give notice to the objector that he/she has either amended the list (specifying the amendment) or that he/she considers the objection to be not well founded and declines to amend the list [note 55]. The official receiver as liquidator has the power to amend or add to the list [note 56]. The objector may, within 21 days of the notice of the liquidator’s response to the original objection, apply to court for an order removing the entry to which he/she objects or otherwise amending the list [note 57]. The Official Receiver is not personally liable for the costs relating to such an application [note 58].
31.10.40 Making calls on contributories
Once any objections have been disposed of and the list of contributories has been settled, the official receiver as liquidator may (subject to sanction or leave of the court outlined below) make calls on any or all of the contributories to the extent of their liability [note 59][note 60].
The official receiver as liquidator requires the sanction of the liquidation committee [note 61] or leave of court [note 62] before making calls. In the absence of a liquidation committee the official receiver will require the consent of the Secretary of State [note 63] and should contact Technical Section to obtain sanction.
Once sanction has been obtained the official receiver may serve notice on the contributories requiring payment to be made. The notice should be given to each of the contributories and should contain details of the amount of balance due from him/her and whether the call is being made with sanction or the leave of the court [note 64].
The payment of any amount due may be enforced by order of court [note 65].
31.10.41 Seeking contributions from contributories in unregistered companies
The procedure for seeking contributions in unregistered companies is very similar to that outlined above at paragraphs 31.10.36 to 31.10.40. It is covered in detail in Chapter 58 Unregistered companies, paragraphs 58.16 to 58.20.
31.10.42Other debts due from contributories
The court may make an order that any contributory on the list of contributories pay, in a manner directed by the order, any money other than unpaid calls due from him/her to the company [note 66].
31.10.43 Unsaleable assets
Generally, where an asset is considered to be unsaleable it should be disclaimed as soon as possible. An alternative is to sell the item to the directors of a company in liquidation or a relative of the bankrupt for a nominal sum.
Where goods remain unsold after an auction, the official receiver should take his/her agent’s advice as to whether it would be worthwhile to enter the items into another sale or otherwise arrange for their disposal.
In bankruptcy cases the official receiver as trustee may, with the sanction of the creditors’ committee, divide the asset between the creditors in circumstances where it cannot otherwise be sold [note 67]. It is unlikely that this course of action will be the most appropriate to follow. Sanction is required to carry out this action; therefore Technical Section should be contacted for advice before the official receiver embarks on such a course.