Bankruptcy and the jurisdiction of the courts
September 1997
The High Court and the county courts have jurisdiction in England and Wales in relation to insolvent individuals [Note 1]. A bankruptcy petition can only be presented to the court if the debtor satisfies both the domicile and residence conditions prescribed by section 265 of the Act which establish a geographic connection between the debtor and the English bankruptcy system.
45.71 Proceedings in the High Court
Except where there is in force for the debtor a voluntary arrangement in which case the petition shall be presented to the court in which the nominee’s report was submitted, bankruptcy proceedings must be commenced in the High Court if [Note 2] [Note 3]:
a. the petition is presented by a Government department and the petition is based upon an unsatisfied execution or it is indicated in the statutory demand their intention to petition in the High Court; or
b. the debtor against whom the petition is presented has resided or carried on business within the London insolvency district for the greater part of the 6 months immediately preceding the presentation of the petition or for a greater part of those 6 months than any other insolvency district; or
c. the debtor is no longer resident in England or Wales but was resident or carried on business in England and Wales within the 6 months immediately preceding the presentation of the petition and the debtor either carried on business or resided in the London insolvency district for a longer period in those 6 months than in any other insolvency district; or
d. the debtor is not resident in England or Wales and has not carried on business in England and Wales within the 6 months immediately preceding the presentation of the petition; or
e. the petitioning creditor is unable to ascertain the residence or place of business of the debtor.
45.72 Transfer to county court
Once a bankruptcy order is made the proceedings may be transferred to the appropriate county court if the debtor does not reside or carry on business within the London insolvency district [Note 4].
45.73 The London Insolvency District
The London Insolvency district includes the districts of the inner London county courts Bow, Central London, Clerkenwell, Lambeth, City of London, Shoreditch and West London as well as the county courts at Barnet, Brentford, Edmonton, Wandsworth and Willesden. The Lord Chancellor has the power to redesignate insolvency districts if necessary [Note 5].
In all other cases the proceedings must be begun in the county court for the insolvency district in which the debtor has resided or carried on business for the longest period during the 6 months immediately preceding the presentation of the bankruptcy petition [Note 6]. If the debtor resided in one district and carried on business in another, the petition must be presented in the latter and if during that period he has carried on business in more than one district, the petition must be presented to the court for the district which was his principal place of business for the longest period [Note 7].
Many county courts are excluded from bankruptcy jurisdiction. The HMCS County Court Index
provides information on the geographical jurisdiction and work of individual county courts.
45.75 Alternative courts for Debtors petitions
Where a debtor is not obliged to present his petition in the High Court, but for whatever reason it is not possible for the debtor to present his/her petition in their own county court, the debtor may present the petition to an alternative court as set out in the rules [Note 8].
Where the debtor has carried on a business within the 6 months immediately preceding the presentation of the petition, the petition will usually be presented to the county court for the insolvency district where for the greater part of that period of 6 months the debtor carried on the business or where the principal place of business was located if the business was carried on in more than one insolvency district. Alternatively, under Rule 6.40A(5) the debtor may present the petition to either:
Where the debtor has not carried on business in the 6 months immediately preceding the presentation of the petition, the petition will usually be presented in the county court for the insolvency district where the debtor resided for the greater part of that 6 month period. However, under Rule 6.40A(5), the debtor may, as an alternative, present his/her petition to whichever court is specified in Schedule 2 to the Insolvency Rules as being the nearest full time court in relation to the court for the insolvency district where he/she resides.
45.76 Voluntary arrangement in force
Where the debtor is involved in a voluntary arrangement, the petitioning creditor, or the debtor himself, must present the bankruptcy petition to the court which heard the nominee’s report under s256. [Note 9] [Note 10].
45.77 Proceedings commenced in the wrong court
Where proceedings are commenced in the wrong court, the court can transfer the proceedings to the correct court, allow them to stay where they are or strike them out [Note 11].
45.78 Transfer between High Court and county court
Where proceedings are pending in the High Court, the court may order them to be transferred to a specified county court [Note 12].
Where proceedings are pending in a county court, the county court may order the proceedings to be transferred to the High Court or to another county court having bankruptcy jurisdiction [Note 13].
Where proceedings are pending in the county court a judge of the High Court may order them to be transferred to that court [Note 14].
45.79 Who may apply for the transfer
A transfer may be ordered by the court of its own motion, on the application of the official receiver or on the application of an interested person [Note 15]. Where a bankruptcy order has been made in the High Court or an interim receiver has been appointed or bankruptcy proceedings have been transferred to that Court from a county court a judge of one division of the High Court can order the transfer of proceedings against the bankrupt from any other division of the High Court or the county court to his division of the High Court [Note 16]. The proceedings which may be so transferred are those brought by or against the insolvent for the purpose of enforcing a claim against the insolvent estate, or brought by a person other than the insolvent for the purpose of enforcing any such claim (including in either case proceedings of any description by a debenture holder or mortgagee) [Note 17].
45.80 Part of proceedings not transferable
In contrast to corporate insolvency, part of a proceeding, such as a motion, may not be transferred from a county court to the High Court with the proceedings in general remaining in the county court [Note 18].
45.81 Cooperation between courts
An order made in any part of the UK in bankruptcy proceedings is enforceable in any other part of the UK as if made by the corresponding court in that part (except in so far as the order relates to property situated there) [Note 19].
The courts having bankruptcy jurisdiction in any part of the UK must assist the courts having corresponding jurisdiction in any other part of the UK or any other relevant territory (Channel Islands, Isle of Man and designated countries) [Note 20].
For more information on co-operation between courts, see chapter 42.
[Back to Part 6 –Hearing of the winding-up petition] [On to Part 8 – Bankruptcy petitions generally]