Part 4 Debtor’s petition – initial actions
January 2012
4.75 Bankruptcy order – initial contact
On the making of a bankruptcy order on the debtor's own petition the official receiver should contact the bankrupt to obtain essential information pending the receipt of the statement of affairs. This information must be, unless the exceptions shown in paragraph 4.76 apply, recorded on the form ICON (ICON).
4.76 Exceptions to using the ICON
Where initial contact has been made with the bankrupt at court (see paragraphs 4.77 and 4.79) it may not be necessary to complete the ICON. The same exception applies where the bankrupt attends the office direct from the court and the official receiver has a copy of the statement of affairs.
4.77 Where the bankrupt is interviewed in person
(amended August 2012)
Where the bankrupt is interviewed at court or attends at the official receiver’s office, either immediately or by appointment (see paragraphs 4.86 and 4.112) the following forms must be given to him/her
The restrictions of bankruptcy should be explained at this stage as it may be the only time the bankrupt is seen. The bankrupt should be informed that the leaflets a “Guide to Bankruptcy” and the “Insolvency Service Charter”, which explains the expected standards of service, can be downloaded from our website. If the bankrupt requests hard copies these should be provided.
The ICON, unless one of the exceptions mentioned in paragraph 4.76 applies, must be used to record essential information and should be limited to establishing:
4.79 Interviewing at court
The official receiver should only interview the bankrupt at court with the agreement of the court. Any such interviews should fit in with the court's arrangements for hearing debtor’s petitions. The official receiver should not seek to persuade the court to change its procedures to suit him/her. Her Majesty's Courts & Tribunals Service no longer allow bankrupts to use the court telephones to contact the official receiver.
Where the official receiver confirms that the bankrupt is trading he/she needs to consider carrying out an inspection of the bankrupt's premises. In making the decision the official receiver should consider the nature of the bankrupt's business, for example there may be no need for an inspection where the bankrupt traded from his/her own home and the only business assets are hand tools. An inspection of a non-trading bankrupt's premises is rare. Following an inspection the official receiver should, where necessary, arrange appropriate insurance cover (see paragraph 4.84). Further details on inspections are contained in Chapter 8.
Where the debtor files his own petition, he/she is required to complete a statement of affairs. The statement of affairs requires the bankrupt to provide detailed information about his/her assets, liabilities, income, expenditure, reasons for insolvency, etc. The statement of affairs is filed at court and a copy is provided to the official receiver shortly after the making of the order.
4.82 Initial review of the statement of affairs
The examiner should review the statement of affairs within two working days of its receipt by the official receiver. The review should take approximately 30 minutes, although each bankruptcy is different and the time needed will vary. The official receiver should ensure that the statement of affairs is clearly marked with the date it was received in the office to enable the date of its review to be checked.
The review of the statement of affairs should consider whether the other available information confirms or contradicts the content of the statement of affairs and the 'causes of insolvency' (section 11). The review should also
Any matters not covered in the ICON that require urgent attention should be dealt with immediately.
If the official receiver identifies any assets whilst completing the ICON, reviewing the statement of affairs or at any other stage in the bankruptcy insurance cover should be arranged in accordance with the instructions contained in Chapter 49, in particular paragraph 49.4. If the asset is subsequently discovered to have no value the cover should be cancelled promptly.
4.85 Other actions following the review of the statement of affairs
The official receiver, within two working days of the review, must
4.86
Bankrupt's appointment letter(amended February 2014)
Within two days of reviewing the statement of affairs the official receiver should send the appropriate appointment letter to the bankrupt. The type of appointment letter sent will depend upon the outcome of the review and the case type. The letters available ar
4.87 Documents to be included in the bankrupt’s appointment letter
(amended February 2014)
The following should be included with the bankrupt’s appointment letter (NTB1) to the bankrupt, unless they have been served personally (see paragraph 4.77):
The NTB2, TNIDIS, Ethnic monitoring form (EMF) and DPADA are contained within the combined package BKTINITIAL.
The appointment letter informs the bankrupt the leaflets a “Guide to Bankruptcy” and the “Insolvency Service Charter”, which explains the expected standards of service, can be downloaded from our website. If the bankrupt requests hard copies of the leaflets these should be provided. In creditor petition cases (see Part 5) and most type 2 bankruptcies the letter should also include a map showing the location of the official receiver’s office, details of parking facilities and public transport information.
4.88 Type 0 bankruptcies – definition
(updated October 2013)
A bankruptcy can be marked as type 0 where:
The definition of type 0 bankruptcies should be strictly adhered to. Type 0 bankruptcies should be restricted to those cases that meet the above criteria.
4.89 Type 0 bankruptcies – assets
In type 0 bankruptcies the official receiver must ensure that all potential assets are appropriately dealt with. Where the official receiver accepts property as exempt, a letter confirming this should be sent to the bankrupt promptly.
4.90 Borderline Type 0 bankruptcies
In bankruptcies that appear to fall within the type 0 definition, a small amount of additional information may be required. For example there may be insufficient information to decide if a motor vehicle is exempt property; or additional information may be required to decide whether an Income Payments Agreement or Order should be sought; or incomplete addresses have been supplied and the official receiver is unable to send a report to all creditors. In these circumstances the bankruptcy should be allocated, or re-allocated if necessary, as a type 1 bankruptcy.
4.91 Type 1 bankruptcies – definition
A bankruptcy can be marked as type 1 where after reviewing the statement of affairs, and any other information provided, the examiner needs additional information, but not enough to require a full interview. Further information on a type 1 interview may be found in Part 3 of Chapter 11.
4.92 Type 1 bankruptcies – the interview
It is expected that the majority of type 1 bankruptcies will be conducted by telephone, although the bankrupt may request a face to face interview. The majority of these interviews should take no longer than an hour. The interview may only involve obtaining one or two additional pieces of information, for example, when the debts were incurred, the balance at bank, confirmation of household income, etc.
4.93 Type 1 bankruptcies – conducting the interview
The official receiver should use the form TCIR to focus on the key issues. The TCIR is intended for guidance only and may be used to identify any gaps in the initial review. It is indicative of the types of questions to be asked, but it is not exhaustive. Additional questions covering credit obtained in the last 12 months, payments to relatives, assets sold, etc. may be relevant in a particular bankruptcy.
4.94 Information to be recorded on TCIR
(updated October 2013)
The following information should be recorded on the TCIR:
The TCIR should be read in conjunction with the statement of affairs, the ICON and any other information provided by third parties. The TCIR may be appointed to an insolvency practitioner if appointed trustee and it will assist in their duties.
4.95 Type 1 bankruptcies – further enquiry/investigation
If it becomes apparent during the interview that there are matters for further investigation, for example possible mis-conduct, where the bankrupt may have committed a criminal offence, where there are complex asset matters, etc, the official receiver may conclude the interview once all the case administration matters have been dealt with and arrange a further Type 2 interview. See paragraph 11.40 for further guidance.
4.96 Type 2 bankruptcies – definition
Any bankrupt not falling within the type 0 or type 1 category is defined as a Type 2 bankruptcy. Type 2 bankruptcies include all trading cases, all second (or subsequent) bankruptcies and all other cases where the official receiver considers further investigation is necessary.
4.97 Type 2 bankruptcies – initial appointment letter
The initial appointment letter will include the booklet PIQDB if the bankrupt has traded within the two years ending with the date of the bankruptcy order, as well as the documents mentioned in paragraph 4.87. The PIQDB should be completed by the bankrupt and returned to the office or be brought to a face to face interview.
4.98 Type 2 bankruptcies – the interview.
A type 2 bankruptcy will normally be allocated to a L3 examiner, who would conduct a face to face interview. Further information on interviewing in type 2 bankruptcy cases is provided in paragraph 11.41.
4.99 Other parties the official receiver should contact
The official receiver, after receiving information from the bankrupt and/or others, should send immediate notice to:
Where the bankrupt is trading it is imperative that immediate action is taken. In most cases the official receiver will close down the business and dismiss any employees (see paragraph 4.174). See Chapter 76 for further information on employment law. For details on inspecting a trading premises see part 4 of Chapter 8. Any decision to continuing trading should only be made after the official receiver has considered the matters outlined in Chapter 62 and Chapter 2.
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