1.11 Casework
The official receiver in performing his/her administrative duties needs to consider and apply the required quality standards to the general casework administration of every case, and is expected to exercise due judgement and discretion. These quality standards are set out in 'The Official Receiver's Casework Process Quality Standard'.
In accordance with ex parte James [1874] LR 9CH 609 the official receiver is under a duty to be fair, principled, and honourable, (see paragraph 1.17 below).
The official receiver is accountable to the court as an officer of the court and as a statutory office holder – he/she is responsible to the creditors, contributories or the bankrupt for the administration of the estate.
In practice these roles rarely conflict but if in a particular case the official receiver had a duty or interest as liquidator or trustee which ran against the interest of BIS, his/her duty as liquidator or trustee would prevail.
1.13 Judicial Review [s136, s293]
The judicial review procedure is a means by which the courts can supervise how ministers and Government Departments or other public bodies exercise their powers and carry out their duties. In carrying out his/her administrative functions the official receiver exercises discretion whether to act, to act in a particular way or not to act at all, e.g. the official receiver’s decision under section 136 or section 293 whether or not to exercise his/her power to summon a meeting of creditors. It is this discretion that may be challenged by the party affected, by way of application for judicial review.
Where the official receiver acts as an officer of the court he/she is not subject to judicial review because he/she acts under the supervision of the court to which he/she is attached, and any complainant therefore has a remedy available to him/her through application to the court.
Current guidance on judicial review is set out in The Treasury Solicitor’s pamphlet, ‘The judge over your shoulder’ which is available on The Treasury Solicitor’s web site at http://www.tsol.gov.uk/Publications/Scheme_Publications/judge.pdf
The official receiver and his/her staff follow the principles set out in the Civil Service Code and should conduct themselves with honesty and integrity. They should not misuse their official position or information acquired in the course of their official duties to further their private interests or those of others. They should not accept benefits of any kind from any party which might reasonably be seen to compromise their personal judgement or integrity.
Official receivers and their staff should be sensible and cautious when deciding whether or not to accept any offered gift or hospitality. Their judgement and integrity might be compromised, or called into question, where the offeror hopes or stands to gain in any way from acceptance, or there might be an appearance, perception or inference that the offeror had gained or might expect to gain, since there could be no proper business reason for the gift or hospitality. All gifts and hospitality accepted should be recorded in the Gifts and Hospitality Register.
1.16(a) Dealing with the public
The official receiver deals directly or indirectly with various members of the public including bankrupts, company officers, creditors and contributories, and insolvency practitioners. The official receiver also has dealings with banks, solicitors, accountants and any other parties affected by insolvency. The official receiver also deals with the courts, BIS and its Ministers, agencies that deal with prosecutions and regulation, and other government departments. The official receiver and his staff must deal with all the 'users' of the Service in line with the principles set out by the Government in The Service's and Citizen's Charters and relevant legislation e.g. the Data Protection Act 1998, (see paragraph 1.17 and chapter 81A). Additionally the official receiver and his/her staff should ensure that the standards set for quality public service are followed in dealings with everyone who has contact with The Service.
1.16(b) The complaints procedure
(Amended November 2012)
The Insolvency Service is committed to providing a professional, efficient, courteous and helpful service to its users - whether they are creditors, insolvency practitioners, bankrupts, directors, or anyone with whom it has dealt. The Insolvency Service operates a complaints procedure where a user is dissatisfied with the service provided. Any complaint against the official receiver or his/her staff is dealt with under this procedure.
Full details of the complaints procedure are provided in The Insolvency Service leaflet ‘Complaints procedure: How to Complain’ which is available on The Insolvency Service website www.bis.gov.uk/insolvency.
An official receiver should, where appropriate, tell the people with whom he/she deals about their general rights and responsibilities, and let them know where they may obtain further information or advice. The official receiver should not attempt to provide legal or other advice or allow an inordinate amount of time to be spent in assisting an individual when it is clear that advice is available elsewhere e.g. from the local Citizen’s Advice Bureau, the address of which can be obtained from the telephone directory.
The official receiver should try to ensure that any information given is accurate. He/she need not disclose information to anyone who has no good reason to have it. The statutory regime for disclosure of so-called personal data is set out in the Data Protection Act 1998, which is covered in chapter 81A. The official receiver must also follow the Code for access to government information.
The official receiver’s role in the passage of information in criminal, civil and regulatory cases is described at part 4 of this chapter. Disclosure is dealt with at chapter 47.
Any long or otherwise unjustifiable delay or obstruction in the supply of information may be reviewed by external authorities, e.g. the Data Protection Commissioner, and should be avoided.
As an officer of the court, the official receiver may be immune from being sued when acting within the scope of his/her powers and duties where he/she might otherwise be liable, e.g. over a statement containing inaccurate or misleading information, (Mond v Hyde and Another [1998] 3 All ER 833).
The official receiver and his staff, as public officers, may be liable under the tort of misfeasance for any abuse of their powers.
The official receiver and his staff are entitled to inspect the court’s files on insolvency proceedings. The court on request will forward any file, unless it is currently in use at the court. The information required should be extracted, and material photocopied if necessary, and the file returned to court as quickly as practicable. No papers should be removed from the court file. Particular care should be taken to ensure that the file is returned intact, with all of its contents in their original order and condition.
Notes: [r7.31 substituted by r7.31A]
The official receiver may apply to the court for directions where he is uncertain how to proceed or wants the court’s approval for a particular course of action.
Notes: [r10.3]
Official receivers and deputy official receivers have a right of audience in the High Court and the County Court in all insolvency proceedings. That includes all hearings, whether in private or public, regardless of whether or not the official receiver is a party to the application. The official receiver should inform the court of any relevant information which may have a bearing on a particular application, or on a case in general, although he/she will normally only attend court:-
Notes: [r7.52]
1.22 Reports to Court (amended August 2010)
Instead of filing witness statements, the official receiver, as an officer of the court, may submit evidence to the court in the form of a report. Considerable care should be taken over the accuracy of a report, the contents of which are treated as prima facie evidence, and the official receiver should clearly identify any opinions expressed.
The official receiver would normally only report on his own investigations if there had been a successful prosecution or disqualification in a case (see chapter 18, paragraph 18.21).
Notes: [r 7.9]
1.23 Liability for costs and expenses
Various provisions in the Act and Insolvency Rules (e.g. on public examinations) specify that the official receiver is not to be personally liable for costs. If the official receiver is made a party to any proceedings on the application of another, he/she will not be liable for costs unless the court so directs. Any expenses, including damages incurred by the official receiver (acting in whatever capacity) in proceedings taken against him/her, are treated as expenses of the insolvency, and are chargeable to the estate.
Notes: [r7.39] [r10.4]
1.24 Duty on making of winding up order
On the making of a winding-up order, the official receiver’s main duty is to investigate the causes of the failure and identify the reasons for it. Details of the official receiver’s duties as liquidator are set out in Part 5 of this chapter. The official receiver will, where possible, complete a preliminary examination of company officers or partners, and in every case prepare a Case Assessment Record (CAR B) which will recommend whether further investigation into the financial affairs of the company/partnership is required. He/she should also consider the conduct of the directors, partners or others who have taken part in the management of the company/partnership, and report any suspected unfitness to the Secretary of State (see Chapter 15 – Aims and conduct of OR’s investigations).
Notes: [s132] [s7(3) CDDA 1986)]
1.25EA Duty on making of bankruptcy order
On the making of a bankruptcy order, the official receiver’s main duty is to investigate the conduct and affairs of the bankrupt, and make any report he/she thinks fit to the court. Details of the official receiver’s duties as receiver and manager are set out in Part 6 of this chapter. In cases where bankruptcy orders are made against individual partners in conjunction with an order against the partnership, the official receiver will be appointed trustee on the making of the order. The official receiver will, where possible, complete a preliminary examination of the bankrupt, and in every case prepare a CARB, which will recommend whether or not further investigation into the financial affairs of the bankrupt is required, (see also Chapter 15 Aims and conduct of OR’s investigations
Notes: [s289]
1.26 Record of important decisions
When any important decision is taken (e.g. as regards the continuation of a business) a note should be made and kept on the official receiver’s file to record the decision-making process. The note should set out the reasons for the decision, and any other relevant information. The file will then help to explain the decision if it is subsequently challenged, either in the courts or by way of a complaint to the Secretary of State.
Following completion of the preliminary examination and necessary inquiries, a CARB must be completed within 28 days of the insolvency order. The CARB contains an examiner’s recommendations on the case, upon which important decisions will be based. Once completed, the CARB will be a file reference document, and important source material for any case quality audit review. (see Chapter 15).
1.27 Duty to report to creditors (amended August 2010)
The official receiver has a duty to send to the creditors and contributories of a company and to the creditors of a bankrupt at least one report on the insolvency proceedings and the state of the company’s or bankrupt’s affairs. A copy of the report must be sent to the private sector liquidator or trustee, if one has been appointed. (see Chapter 18)
With effect from 6 April 2010, the official receiver is no longer required to file a copy of the report to creditors at court in any case.
Notes: [r4.45] [r6.73]
(amended May 2010)
Where the official receiver is liquidator, a liquidation committee is not required or able to act, and its functions vest in the Secretary of State. Where the Secretary of State is required to carry out the functions of a liquidation committee delegated authority to exercise the committee’s functions is held by Technical Section. Where the official receiver is acting as liquidator an application for sanction should be made to Technical Section by e-mail. The e-mail should provide details of the need for the application
Notes: [s141(4) and r4.172]
When no committee has been formed and the liquidator is an insolvency practitioner, the functions of the liquidation committee are vested in the Secretary of State. Where the Secretary of State is required to carry out the functions of a liquidation committee delegated authority to exercise the committee’s functions is held by Insolvency Practitioner Unit. An insolvency practitioner liquidator wishing to apply for sanction should be advised to send all applications directly to Insolvency Practitioner Unit (see also Chapter 29, paragraph 29.3).
Notes: [s141(5) and r4.172]
1.29 Creditors’ committee [s301(2), s302(2) and r6.166)
(amended May 2010)
A general meeting of creditors may not establish a creditors' committee when the official receiver is trustee of the bankrupt’s estate (except in connection with an appointment of an insolvency practitioner at that meeting). When the official receiver is trustee, a creditors’ committee is not required or able to act and its functions are vested in the Secretary of State. Where the Secretary of State is required to carry out the functions of a creditors’ committee delegated authority to exercise the committee’s functions is held by Technical Section. Where the official receiver is acting as trustee, an application for sanction should be made to Technical Section by e-mail. The e-mail should provide details of the need for the application, see paragraph 1.28 for further advice.
[s301(2), s302(1) and r6.166]
When no committee has been formed and the trustee is an insolvency practitioner, the functions of the creditors’ committee are vested in the Secretary of State. An insolvency practitioner trustee wishing to apply for sanctions should be advised to send all applications directly to Insolvency Practitioner Unit (see also Chapter 29, paragraph 29.3).
[s302(2) and r6.166]
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