The Insolvency (Amendment) Rules 2010

Transitional provisions

The Insolvency (Amendment) Rules 2010 (IAR) came into force on 6 April 2010 and Schedule 4 sets out how the amended provisions apply to insolvency proceedings (the transitional provisions).  

The transitional provisions in relation to companies in compulsory liquidation, bankruptcies, debt relief orders and individual voluntary arrangements state that the amended rules apply :-

• Where a company goes into liquidation on the making of a winding-up order on a petition presented on or after 6 April 2010, except where immediately prior to the liquidation there was one of the following:

1. An administration (under paragraph 10 of schedule B1 to the Act) where the administrator was appointed by the court on an application made before 6 April 2010;
2. An administration (under paragraph 14 or 22 of schedule B1 to the Act) where the appointment of the administrator took effect before 6 April 2010 and was effected by either a floating charge holder or by the company or its directors; or
3. A voluntary liquidation where the resolution to wind up the company was passed before 6 April 2010.
• Where a person agrees to act as a nominee in respect of a proposal for an IVA on or after 6 April 2010.
• Where a debt relief order is made on or after 6 April 2010.
• Where a bankruptcy order is made on a petition presented on or after 6 April 2010.

For cases where the amended rules do not apply, the rules as they existed before 6 April 2010 continue to apply. 

General amendments effective from 6.4.10 in all cases

In order to maximise the benefits that can be drawn from the modernisation changes, certain provisions within the IAR and the Legislative Reform (Insolvency) (Miscellaneous Provisions) Order 2010 (LRO) (which made changes to the Insolvency Act 1986 to allow some of the rule changes) are effective for all cases, regardless of whether they commence before, on or after 6 April 2010. The following is a brief summary of these general amendments:

1. Electronic delivery

• The Act and Rules have been amended to allow notices and information to be sent or received by electronic means, provided that the intended recipient has consented and provided an electronic address for delivery. The recipient must also be advised that they can request a hard copy from the sender. There are some exceptions to this provision (filing with the court or Companies House and service of any statutory demand - see Rules 12A.6 to 12A.14).
• Any reference in the Act or the Rules to a document or information in writing includes that document or information in electronic form. There are some exceptions to this provision, such as written statutory type demands (see section 436B of the LRO).
• Where any provision of the Act or the Rules requires the office-holder to give, deliver, furnish or send a notice or other document or information to any person, this is satisfied by making it available on a website (see LRO sections 246B and 379B and Rule 12A.12).

2. Terminology

• Where the word ‘fit’ has been used in reference to a decision of the court, it is substituted by ‘just’.
• Where the word ‘leave’ appears in the Rules, this is substituted by ‘permission’ (except for Rule 4.20)
• To assist in the facilitation of electronic delivery any references to sign, signing, signs, signed or signature are replaced by authenticate, authenticating, authenticates, authenticated and authentication.

3. Miscellaneous

• Affidavits are no longer required and have been replaced throughout the Rules by witness statements or statements of truth.
• References to the ‘venue’ for any court proceeding or meeting must include the time and date (or time and date only for a remote meeting) (see Rule 13.6).
• Where a meeting is to be held, this can be done on a remote basis. The chairman must ensure that they are able to properly identify those attending and that all those attending can speak and vote (see LRO sections 246A and 379A and Rules 12A.22, 12A.26 ).