Creditor's bankruptcy petition – procedure and hearing

Creditor's bankruptcy petition – procedure and hearing

September 1997 

45.109 Contents of the petition

(Amended August 2012)

Petitions must be prepared on statutory forms which are contained in schedule 4 to the Insolvency Rules 1986. There are 4 forms of petition depending upon the circumstances of the debt. The petitioner is not required to sign, date or have the petition witnessed. In the title only the name of the debtor is necessary as trading names and any alias will appear in the body of the petition [Note 1] [Note 2] [Note 3].  

The end of the petition should also have the following certificate included

 “I/we certify that I/we have conducted a search for petitions presented against the debtor in the period of 18 months ending today and that [no prior petitions have been presented in the said period which are still pending] [a prior petition (No [      ]) has been presented and is pending in the [      Court] and we are issuing this petition at risk as to costs].

Signed………      Dated………”. 

This certificate is to evidence that the appropriate searches for pending petitions have been conducted by the petitioning creditor (see paragraph 45.85) [Note 3A]. 


45.110 Identifying the debtor

(Amended October 2010)

The petition must provide the following details, to the best of the petitioner’s knowledge [Note 4]:

a. the debtor’s name, address and occupation;

b. his trading style(s) and whether the business is carried on alone or jointly with others;

c. the nature of the debtor’s business and his trading address;

d. the name(s) in which the debtor has carried on business at or after the debt was incurred; and whether the business was carried on alone or jointly with others;

e. the address at which he has resided or carried on business at or after the debt was incurred and the nature of that business and

f. whether the debtor has his centre of main interests or an establishment in another member state.

The details provided in the petition determine the full title of the proceedings which may be amended on application by the trustee or the official receiver once a bankruptcy order is made [Note 5].

If the petitioner is aware that the debtor has used names other than that specified, he must state that fact in the petition [Note 6]. 


45.111 Identifying the debt

If the petition is based on more than one debt, the following must be stated for each debt [Note 7]:

a. the amount of the debt, the consideration (or the way in which it arises) and the fact that it is owed to the petitioner. Where the petition is based on a statutory demand only the debt claimed in the demand may be included in the petition [Note 8];

b. when the debt was incurred or became due;

c. details of interest charges included in the debt which may not have been previously notified to the debtor;

d. that the debt is for a liquidated sum payable immediately which the debtor is unable to pay or that it is for a liquidated sum payable at some certain time in the future (that time to be specified) and the debtor appears to have no reasonable prospect of being able to pay in the future. In either case the petition must also state that the debt is unsecured, subject to section 269.

Where the petition is based on a statutory demand, details of service (including the date of service) must be included and it must be stated that to the best of the petitioner’s knowledge and belief the demand has been neither complied with nor set aside and no application to set it aside is pending [Note 9]. Where the petition is based on a judgment or order of court and the execution is returned unsatisfied, details of the issuing court and the return must be given [Note 10]. 


45.112 Outstanding Petitions - Practice Note of Chief Registrar 7 July 1995

Before a bankruptcy petition is issued the petitioner should first check that there are no outstanding petitions against the individual concerned. This is most effective by a search of the Land Registry for pending actions (See also paragraph 45.39).



45.113 Presentation of the petition

(Amended October 2010)

When filing the petition, the petitioner must file the original, one copy for service on the debtor and an additional copy, if appropriate, for the supervisor of any individual voluntary arrangement in force [Note 11]). The original must be verified by a statement of truth [Note 12] [Note 13] [Note 14]. The statement of truth shall be made by the petitioner or some other authorised person with the necessary knowledge of the matters referred to in the petition [Note 15]. If the petition has been preceded by a statutory demand, the certificate or certificates of service must also be filed in court with it [Note 16]. When the court is satisfied that the petition and other documents are in order, the petition and all copies will be sealed and one copy handed back to the petitioner (or two if an individual voluntary arrangement is in force) [Note 11]. The date and time of filing the petition will be endorsed on the petition and the copies, as will the venue for the hearing of the petition [Note 17] [Note 18]. 


45.114 Delays in presenting the petition

(Amended October 2010)

Where the petition is based on a statutory demand which was served more than 4 months before the presentation of the petition, the petition must include a statement  explaining the reasons for the delay [Note 19]. 


45.115 Notice of the petition

Once filed, the court will send a copy of the petition to the Chief Land Registrar with a request that it be registered in the register of pending actions [Note 20]. 


45.116 Consolidation of petitions

Where more than one petition is pending against the same debtor, the court may consolidate the proceedings under such terms as it thinks just [Note 21]. 


45.117 Service of the petition

A sealed copy of the petition must be served personally on the debtor by an officer of the court, or by the petitioning creditor or his solicitor (or by a person instructed by them), not less than 14 days before the hearing [Note 22] [Note 23]. For petitions presented after 6 April 2010, service outside of England and Wales may be effected with the permission of the court and in such manner as the court may direct [Note 24]. 


45.118 Substituted service

(Amended October 2010)

If the court is satisfied by a witness statement or other evidence on oath that prompt personal service is not possible, perhaps because the debtor is avoiding the proceedings, then on the application of the petitioner it may order substituted service in such terms as it thinks just [Note 25]. 


45.119 Steps which will justify an order for substituted service

(Amended October 2010)

The Civil Procedure Rules 1998 Practice Direction on Insolvency Proceedings  sets out the evidence which will suffice in most cases to justify an order for substituted service. This includes a personal call at all known business and residential addresses of the debtor; a letter to the debtor sent by first class post to all known addresses, giving at least 2 business days notice of a further visit to serve the petition, and informing the debtor that failure to keep the appointment will result in an application for an order for substituted service; enquiries at the addresses to which the letter was sent to establish whether the debtor was in receipt of mail addressed to him there or whether they are forwarded to another address; and attempts to meet with the debtor through his solicitor (if represented) [Note 26]. 


45.120 Deemed service

Where an order for substituted service has been carried out, the petition is deemed served on the debtor [Note 27]. If that order is for service by first class post, the order will normally provide that service is deemed to be effected on the seventh day after posting [Note 28]. 


45.121 Certificate of service

(Amended October 2010)

Service of the petition must be proved by a certificate of service [Note 29]. The certificate of service must be sufficient to identify the petition served and must specify [Note 30]:

a. the name of the debtor,

b. the name of the petitioner,

c. the court in which the petition was filed and the court reference number,

d. the date of the petition,

e. whether the copy served was a sealed copy,

f. the date on which service was effected, and

g. the manner in which service was effected.

Where substituted service has been ordered, the certificate of service must have attached to it a sealed copy of the order [Note 31]. The certificate of service must be filed in court as soon as reasonably practicable after service, and in any event not less than 5 business days before the hearing of the petition [Note 32]. 


45.122 Extension of time for hearing

If the petition has not been served, the petitioning creditor can apply to the court to appoint another venue for the hearing but the application must state the reasons why the petition has not been served [Note 33]. 


45.123 Adjournments

If the court adjourns the hearing of the petition, the petitioning creditor must send to the debtor, and to creditors who indicated that they wished to attend the hearing but were not present thereat, notice of the adjournment and the time and venue of the adjourned hearing [Note 34]. 


45.124 Death of the debtor

(Amended October 2010)

If the debtor dies before service of the petition, the court may order service to be effected on his personal representative or on such other persons as the court thinks just [Note 35].

For more information on deceased insolvents, see chapter 54. 


45.125 Interim receiver

At any time after the presentation of the petition and before the making of a bankruptcy order the court can appoint the official receiver to be interim receiver if it is shown that the debtor’s property is at risk. Only the official receiver can be appointed interim receiver except where the court has appointed an insolvency practitioner to prepare a report under section 273, in which case that person can be appointed.

Application for the appointment of an interim receiver can be made by the debtor himself, a creditor, the insolvency practitioner appointed to prepare the report as mentioned, a temporary administrator or a member state liquidator [Note 36]. For more information on the appointment, powers and role of an interim receiver, see chapter 2. 


45.126 Opposition by the debtor

(Amended October 2010)

If the debtor intends to oppose the petition he must file in court a notice, not less than 5 business days before the hearing (7 days for pre 6 April 2010 petition cases), specifying the grounds on which he objects to the making of an order and send a copy to the petitioning creditor or his solicitor [Note 37]. In practice, however, if he fails to comply with this rule, there appears to be no sanction against him in that he can still oppose the petition. The only penalty is that he may have to pay the costs of an adjourned hearing. 


45.127 Attendance at the hearing

(Amended September 2012)

The petitioning creditor, the debtor and the supervisor of a voluntary arrangement may appear and be heard at the hearing [Note 38]. Any creditor who wishes to appear and be heard at the hearing must give notice to the petitioning creditor not later than 4pm on the business day before the day of the hearing [Note 39], stating the following [Note 40]:

a. the name and address of the person giving the notice, and any telephone number and reference which may be required for communication with him/her or with any other person (to be specified in the notice) authorised to speak or act on his/her behalf;

b. whether his/her intention is to support or oppose the petition; and

c. the amount and nature of his/her debt.

On the day of the hearing, the petitioner prepares a list for the court of those creditors who have given notice with an indication of whether they intend to oppose or support the petition [Note 41]. Creditors who do not give notice may attend the hearing but cannot be heard without the permission of the court [Note 42]. 

The court will also need to be satisfied that the debt upon which the petition is based has not been paid, secured, or compounded for.  A certificate signed by the person representing the petitioning creditor in the following form would normally be sufficient [Note 42A]  -

“I certify that I have/my firm has made enquiries of the petitioning creditor(s) within the last business day prior to the hearing/adjourned hearing and to the best of my knowledge and belief the debt on which the petition is founded is still due and owing and has not been paid or secured or compounded for save as to…

Signed………      Dated………”. 


45.128 Failure to attend

(Amended October 2010)

If the petitioning creditor fails to attend the hearing no subsequent petition by the same creditor for the same debt can be presented against the same debtor whether alone or jointly without the permission of the original court [Note 43]. 


45.129 Substitution of petitioner

Where the petitioner is found not to be entitled to have presented a petition, or wishes to withdraw his petition or allow it to be dismissed, or fails to attend on the hearing, or appears but does not apply for an order in terms of his petition, the court may substitute as petitioner any creditor who has given notice of his intention to appear, wishes to prosecute the petition and is a creditor who would have been in a position to present a petition at the time of original presentation [Note 44]. Within 7 days of the order, the new petitioner must file in court an amended petition and an witness statement verifying its contents. He must serve a copy on the debtor not less than 14 days before the date fixed for the adjourned hearing. 


45.130 Change of carriage of petition

Where the court is satisfied that the petitioning creditor does not wish to continue with the petition, it can give carriage of the petition to any creditor who applies and who gave notice of his intention to attend the hearing [Note 45]. In these circumstances the new petitioner is entitled to rely on all evidence previously adduced [Note 46]. The court must not make an order for change of carriage if the original petitioner has been paid or secured for either by third party property or by an approved disposition of the debtor’s property [Note 47]. 


45.131 Amendment of the petition

The court has the general power to authorise a creditor’s petition to be amended by the omission of any creditor or debt and to be proceeded with as if that creditor had not been there [Note 48]. 


45.132 Withdrawal and dismissal of petition

(Amended October 2010)

A petition cannot be withdrawn without the permission of the court and permission will not be given before the hearing  The court has general power to dismiss a bankruptcy petition or stay proceedings on a petition, if it appears appropriate to do so on the grounds that there has been a contravention of the rules or for any other reason. The court may stay proceedings on such terms and conditions as it thinks just [Note 49].

Where the petitioner applies to the court for the petition to be dismissed, or for permission to withdraw it, the petitioner must file in court a witness statement specifying the grounds of the application and the circumstances in which it is made, if either [Note 50]:

  1. a creditor of the debtor has given notice under Rule 6.23 of their intention to appear at the hearing of the petition, or
  2. the court has ordered the petitioner to file a witness statement.

The requirement to attend a hearing restricts the rights of a petitioner to withdraw his petition or to have it dismissed, in consequence of him having come to some arrangement with the debtor for the debts the subject of the petition to be paid off, compounded for, or secured, and thereby prejudicing the general body of creditors (bankruptcy proceedings being essentially a class remedy for the benefit of all creditors). However, with the written consent of both parties accompanied by a list of supporting and opposing creditors (or a statement that no notices have been received from other creditors), the court may dismiss the petition or, if it has not been served, give permission for withdrawal, without the parties having to attend a hearing [Note 51].

The court may dismiss the petition if the debtor is able to pay all his debts or has made a reasonable proposal to the creditor to secure or compound for the debt which has been refused [Note 52].

If the petition is brought in respect of a judgment debt and an appeal is pending against that debt, the court may stay or dismiss the petition [Note 53]. 


45.133 Vacating registration

(Amended October 2010)

If the petition is dismissed or withdrawn by permission of the court, the court issues an order permitting vacation of the registration of the petition as a pending action. Two sealed copies of the order are sent to the debtor by the court and it is for him/her to ensure that the notice is sent to the Chief Land Registrar [Note 54]. 


45.134 Decision on the hearing

At the hearing the court may make the bankruptcy order if satisfied that the statements in the petition are true and that the debt has not been paid or secured or stay or dismiss the petition on such terms as it thinks just [Note 55]. 


45.135 Grounds for the order

The court must not make an order unless it is satisfied that the debt or one of the debts in respect of which the petition was presented has not been paid or secured or is a debt which the debtor has no reasonable prospect of paying [Note 56]. To determine ‘reasonable prospect’, it is assumed that the position the debtor presented to the creditor at the time he entered into the transaction resulting in the debt, gave him a reasonable prospect of paying [Note 57]. Hence with no other change in circumstance, a petitioner cannot subsequently claim that a debtor has no reasonable prospect of paying if the position of the debtor has not changed.

The court may make a bankruptcy order if satisfied that the statements contained in the petition are true and the debt had not been paid or secured for [Note 58].



[Back to Part 10 - Statutory demand against an individual – general procedure] [On to Part 12 - Debtor’s bankruptcy petition]