Part 1 The role of the official receiver
January 2012
When a bankruptcy order has been made by the court the official receiver has a statutory duty to investigate the conduct and affairs of the bankrupt [Note 1]. Where the official receiver thinks that an investigation is not necessary his/her statutory duty does not apply [Note 2].
In fulfilling his/her duty to investigate the affairs of the bankrupt the official receiver may make a report to the court if he/she thinks fit [Note 3].
4.4 The official receiver as receiver and manager
On the making of a bankruptcy order the official receiver is generally appointed receiver and manger of the bankrupt’s estate. The official receiver will not be appointed receiver and manager where the court appoints an insolvency practitioner as trustee on the making of the bankruptcy order (see paragraph 4.8). The official receiver remains receiver and manager until such time as the bankrupt’s estate vests in a trustee. The official receiver will not be appointed manager of the bankrupt’s estate where the court appoints a special manager [Note 4]. For more information on special managers see Chapter 32.4.
4.5 The official receiver’s duties and powers as receiver and manager
The official receiver’s principal duty is to protect the bankrupt’s estate. The official receiver has the same powers (see paragraph 24.12) as a receiver or manager appointed by the High Court [Note 5]. The official receiver may take such steps as he/she thinks necessary, including continuing a business (see paragraph 24.57) and obtaining insurance (see paragraphs 24.31 and 24.32), to protect any property that may be claimed for the estate by the trustee. The official receiver is not required to incur any expenses to protect property unless directed by the Secretary of State [Note 6]. The official receiver has the power to sell perishable goods and/or goods which are likely to diminish in value (see paragraph 4.6) [Note 7]. Detailed guidance on the powers and duties of the official receiver as receiver and manager may be found in Chapter 24.
4.6 Realising assets before the appointment of a trustee
The official receiver as receiver and manager has the power to sell or dispose of perishable or other goods likely to diminish in value unless dealt with quickly (see paragraphs 24.36 and 24.37) [Note 8]. When acting as receiver and manager the official receiver should realise small bank balances for accounts that incur charges, as the charges may have exceeded the bank balance by the time a trustee has been appointed.
4.7 Disposal of assets – directions of court
In certain circumstances the official receiver as receiver and manager may need to quickly deal with property that is neither perishable or likely to diminish in value. In these cases the official receiver may apply to the court for directions [Note 9].
4.8 Insolvency practitioner appointed by the court
The court may directly appoint an insolvency practitioner as trustee on the making of a bankruptcy order in the following instances:
It is the duty of the trustee, if asked, to send creditors a proof of debt form, although the official receiver must send a proof of debt form to any creditor who requests one [Note 12].
4.9 The trustee’s duty to co-operate with the official receiver
An insolvency practitioner appointed trustee by the court on the making of the bankruptcy order will usually be a useful source for information about the bankrupt’s affairs, especially in the initial stages of the case. The trustee has a duty to co-operate with the official receiver and must produce or allow the inspection of the bankrupt's books, papers and other records. This may involve visiting the trustee's offices [Note 13]. If the trustee fails to co-operate the official receiver may apply to the court for an order to enforce compliance [Note 14].
4.10 The official receiver’s duties were a trustee is appointed by the court
Where a trustee other than the official receiver is appointed immediately upon the making of a bankruptcy order the official receiver remains under a statutory duty to investigate the conduct and affairs of the bankrupt where he/she deems it appropriate (see paragraph 4.2). Where the official receiver in the course of his investigations discovers undisclosed assets, which may include rights of action, he/she should inform the trustee and provide copies of any relevant documents (see Chapter 47 part 4 for further details) [Note 15]. The official receiver has to give notice of the order, gazette the order and provide information to the creditors [Note 16].
4.11 Trustee appointed by court – initial notices
The official receiver may consider restricting his/her initial notices to those recipients whose reply may relate directly to the duty to investigate and not to send letters or notices relating to asset recovery. In practice it may be difficult to separate these functions, for example when writing to the bank there may be no need to know the current balance on the account but details of any overdraft facilities may be relevant to the investigation of the bankrupt's conduct and affairs.
4.12 The official receiver’s power to request information
The official receiver may make an application to the court for the examination of any person believed to be able to provide information concerning the bankrupt or the bankrupt’s dealings, affairs or property [Note 17]. Further information on private examinations can be found in Chapter 23.
The official receiver must not disclose information about a case to any person who does not have a legitimate reason to have the details of the case. For further details on the disclosure of information see Chapter 47. In particular the official receiver should note paragraphs 47.85 and 47.86 which explain the disclosure rules regarding a person who has undergone gender reassignment (transsexual). The official receiver’ attention is also drawn to the specific provisions relating to bankrupts who may be at risk of violence (see paragraph 4.27).
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