13.41 Private examinations - generally
This chapter contains only a brief description of the private examination as a method of enforcing co-operation. The practices and procedures relating to private examinations are covered fully in Chapter 23 - Private examinations.
The official receiver can apply to the court for the examination in private of a wide range of persons involved in, or connected with, a bankruptcy or a winding up. These examinations are commonly referred to as private examinations and the rules refer to the subject of the examination as "the respondent".
Notes: [s236 s366]
In a winding up, the respondent may be:
Notes: [s236(2)]
In bankruptcy cases, the respondent may be:
Note: [s366(1)]
13.43 Private examination of discharged bankrupt
Note: s366
Section 366(1) provides that the official receiver can apply to the court for a private examination of a bankrupt at any time after the bankruptcy order has been made. The court's power to direct the bankrupt to attend survives discharge (Oakes v Simms [1997] BPIR 499).
When considering whether to make an application, the official receiver should bear in mind that the costs of the examination must be met by the estate unless ordered otherwise by the court, and that the court has discretion over whether or not to grant the application. The refusal of the discharged bankrupt to co-operate prior to the application must not only be unjustifiable, but must also have a material effect on the estate. For example, if the refusal to provide information results in the official receiver being unable to secure and realise a substantial asset.
Where a partnership has been wound up without concurrent orders being made against the partners, section 236 applies without modification.
Notes: [IPO94 art 7(1)& 9(b)]Where the partnership has been wound up and insolvency orders have been made against the partners either section 236 or section 366 will apply depending on whether the proposed examinee had dealings with the partnership or an individual member as a bankrupt.
Notes: [IPO94 art 8(1), (6) & (7), art 10(2) & (3)]
Where insolvency orders are made against the partners, but no winding up order is made against the partnership, the provisions of section 366 apply without modification.
Notes: [IPO94 art 11(1) & (2)]
The term "property" mentioned in paragraph 13.42 above has a wide meaning and includes money, goods, "things in action", land and every description of property wherever situated and also obligations and every description of interest, whether present or future or vested or contingent, arising out of, or incidental to, property. A "thing in action", sometimes referred to as a "chose in action", is a thing that a person does not have the present benefit of, but merely a right to recover it (if withheld) by action, such as a debt or copyright.
Notes: [s436]
13.46 When application may be made
Except that an application can only be made after the making of the bankruptcy or winding-up order, the Act imposes no time limit on the authority of the official receiver to make an application for a private examination. The official receiver may also make such an application where he/she is interim receiver of the property of a debtor or provisional liquidator of a company.
Notes: [s236(1) s234(1)(d) s368)]
At a private examination the court may, except where the respondent is the bankrupt or his/her spouse or former spouse, order the submission by the respondent of witness statements relating to his/her dealings with, and the production of any records in his/her possession relating to, the bankrupt or company. Any person who appears before the court may be examined on oath and must answer all questions that may be put, or the court may allow to be put, to him/her. He/she may not refuse to answer a question on the ground of self-incrimination. (Bishopsgate Investment Management v Maxwell [1992] BCC 475)
Notes: [s236(3)] [s366(1)] [s237(4)] [ s367(4)]
13.48 Self incrimination at private examination
Note: [s236]
When considering whether to make an order for an examination under section 236 the court must weigh up the risk of oppression to the examinee against the importance to the liquidator of obtaining the information sought. If a liquidator is seeking an examination for the purposes of the liquidation, the fact that information may be given that would also incriminate the examinee in other proceedings does not necessarily mean that the court will not grant the order, particularly where the examinee was a senior officer of the company and has 'insider' knowledge(RBG Resources plc. Shierson & Anor v Rastogi & Ors [2002] BCC 1005).By analogy, that may also apply to bankruptcy cases.
If it appears to the court, having considered any evidence given at a private examination, that any person has in his/her possession any property belonging to the bankrupt or company, the court can, on the application of the official receiver, order that person to deliver that property to the official receiver.
Notes: [s237(1) s367(1)]Similarly, if during a private examination it appears to the court that any person is indebted to the bankrupt or company, the court can, on the application of the official receiver, order that person to pay the amount due to the official receiver.
Notes: [s237(2) s367(2)
Where, without reasonable excuse, a person fails to attend a private examination or there are grounds to believe that he/she is about to abscond to avoid examination, the court may issue a warrant for the arrest of that person or for the seizure of any relevant property or records in his/her possession (see Part 7).
Notes: [s236(5) s364(2)(e) and 366(3) ]
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