Tribunals, Courts and Enforcement Act 2007 (c. 15)

(The document as of February, 2008)

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13 In section 14(4) (rules of court about notice of application for attachment or earnings order), for the words from "give" to "the application." substitute ", within such period and in such manner as may be prescribed, give the court a statement in accordance with subsection (4A) or (4B)."

14 After section 14(4) insert--

" (4A) In a case where the attachment of earnings order would, if made, be a Schedule 3 deductions order, the debtor must give a statement in writing of--

(a) the matters specified in subsection (1)(a) above, and

(b) any other prescribed matters which are, or may be, relevant under section 6 of this Act to the determination of the normal deduction rate and the protected earnings rate to be specified in any attachment of earnings order made on the application.

(4B) In a case where the attachment of earnings order would, if made, be a fixed deductions order, the debtor must give a statement in writing of the matters specified in subsection (1A) above. "

15 In section 14(5) (certain statements in proceedings for making or varying etc attachment of earnings orders deemed to be evidence of facts stated), after "subsection (1)(a) or (b)" insert "or (1A)".

Amendment of section 15: Obligation of debtor and employer to notify changes

16 (1) Section 15(1) is amended as follows.

(2) In paragraph (b) (obligation to notify of court of earnings under new employment) at the beginning insert "if the order is a Schedule 3 deductions order,".

(3) In paragraph (c) (obligation of employer to notify court of debtor's new employment and earnings) for "and include" insert "and, if the order is a Schedule 3 deductions order, include".

Amendment of section 17: Consolidated attachment orders

17 (1) Section 17(3) (rules of court made in connection with consolidated attachment orders) is amended as follows.

(2) In paragraph (b) (rules relating to powers of court to which order etc transferred), after "vary" insert ", suspend".

(3) In paragraph (e) (rules modifying or excluding statutory provisions), after "provisions of this Act" insert ", the fixed deductions scheme".

18 After section 17(3) insert--

" (4) Section 6(1A) applies to a consolidated attachment order which a county court makes to secure the payment of two or more judgment debts even if, immediately before the order is made, one or more of those debts is secured by a Schedule 3 deductions order. "

Amendment of section 23: Enforcement provisions

19 Section 23 is amended as follows.

20 In subsection (1) (failure of debtor to attend hearing)--

(a) for the words from "notice of an application" to "such an order" substitute "relevant notice,";

(b) for "for any hearing of the application" substitute "in the notice for any hearing,".

21 After subsection (1) insert--

" (1ZA) In subsection (1) "relevant notice" means any of the following--

(a) notice of an application to a county court to make, vary or suspend an attachment of earnings order;

(b) notice that a county court is, of its own motion, to consider making, varying or suspending an attachment of earnings order. "

22 In subsection (2)(c) and (f) (offences related to attachment of earnings orders)--

(a) after "section 14(1)" insert "or (1A)".

(b) after "attachment of earnings order" insert "or suspension order".

Section 106

SCHEDULE 16 Administration orders: consequential amendments

Attachment of Earnings Act 1971 (c. 32)

1 (1) Section 4 of the Attachment of Earnings Act 1971 (extension of power to make administration order) is amended as follows.

(2) For subsections (2) and (2A) substitute--

" (2) The court may make an administration order in respect of the debtor's estate if, after receipt of the list referred to in subsection (1)(b) above, the court is satisfied that the conditions in sections 112B(2) to (7) of the County Courts Act 1984 (conditions to power to make administration orders) are met in relation to the debtor. "

(3) In subsection (4) for "section 112" substitute "section 112J".

Magistrates' Courts Act 1980 (c. 43)

2 (1) Schedule 6A to the Magistrates' Courts Act 1980 (fines that may be altered under section 143 of the 1980 Act) is amended as follows.

(2) Insert the following entry at the appropriate place in the entries relating to the County Courts Act 1984 (c. 28)--

" Section 112N(1) (administration orders: failure to provide information)

£250 "

Insolvency Act 1986 (c. 45)

3 (1) Section 429 of the Insolvency Act 1986 (disabilities on revocation of administration order against an individual) is amended as follows.

(2) For subsections (1) and (2) substitute--

" (1) This section applies if a county court revokes an administration order made in respect of an individual ("the debtor") on one of the relevant grounds.

(2) The court may, at the time it revokes the administration order, make an order directing that this section and section 12 of the Company Directors Disqualification Act 1986 shall apply to the debtor for such period, not exceeding one year, as may be specified in the order.

(2A) Each of the following is a relevant ground--

(a) the debtor had failed to make two payments (whether consecutive or not) required by the order;

(b) at the time the order was made--

(i) the total amount of the debtor's qualifying debts was more than the prescribed maximum for the purposes of Part 6 of the 1984 Act, but

(ii) because of information provided, or not provided, by the debtor, that amount was thought to be less than, or the same as, the prescribed maximum. "

(3) In subsection (3) for "a person" in the first place substitute "an individual".

(4) In subsection (4) for "a person" substitute "an individual".

(5) In subsection (5) for "person" substitute "individual".

4 (1) Section 440 (extent: Scotland) is amended as follows.

(2) In subsection (2)(a) (provisions in the third Group of Parts that do not extend to Scotland) for "section 429(1) and (2)" substitute "section 429(1) to (2A)".

Company Directors Disqualification Act 1986 (c. 46)

5 (1) Section 12 of the Company Directors Disqualification Act 1986 (failure to pay under county court administration order) is amended as follows.

(2) For the title of the section substitute "Disabilities on revocation of administration order".

(3) Omit subsection (1).

(4) In subsection (2), for the words from "that section" to "429(2)(b)" substitute "section 429 of the Insolvency Act applies by virtue of an order under subsection (2) of that section".

Courts and Legal Services Act 1990 (c. 41)

6 Omit section 13 of the Courts and Legal Services Act 1990.

Charities Act 1993 (c. 10)

7 (1) Section 72 of the Charities Act 1993 (persons disqualified for being trustees of a charity) is amended as follows.

(2) In subsection (1)(f), for the words from "section 429(2)(b)" to the end substitute "section 429(2) of the Insolvency Act 1986 (disabilities on revocation of county court administration order)."

Pensions Act 1995 (c. 26)

8 (1) Section 29 of the Pensions Act 1995 (persons disqualified for being trustees of a trust scheme) is amended as follows.

(2) In subsection (1)(f), for the words from "section 429(2)(b)" to the end substitute "section 429(2) of the Insolvency Act 1986 (disabilities on revocation of county court administration order)."

Police Act 1996 (c. 16)

9 (1) The Police Act 1996 is amended as follows.

(2) In paragraph 11 of Schedule 2 (disqualification for being appointed as or being member of a police authority), in sub-paragraph (1)(c), for "section 429(2)(b)" to the end substitute "section 429(2) of the Insolvency Act 1986 (disabilities on revocation of county court administration order); or".

(3) In paragraph 7 of Schedule 2A (disqualification for being appointed as or being member of the Metropolitan Police Authority), in sub-paragraph (1)(c), for the words from "section 429(2)(b)" to the end substitute "section 429(2) of the Insolvency Act 1986 (disabilities on revocation of county court administration order); or".

Housing Act 1996 (c. 52)

10 (1) Paragraph 4 of Schedule 1 to the Housing Act 1996 (power to remove director, trustee etc. of registered social landlord) is amended as follows.

(2) In sub-paragraph (2)(c), for the words from "section 429(2)(b)" to the end substitute "section 429(2) of the Insolvency Act 1986 (disabilities on revocation of county court administration order);".

Police Act 1997 (c. 50)

11 (1) The Police Act 1997 is amended as follows.

(2) In section 91 (the Commissioners), in subsection (7)(b), for "section 429(2)(b) of the Insolvency Act 1986 (failure to pay under county court administration order)" substitute "section 429(2) of the Insolvency Act 1986 (disabilities on revocation of county court administration order)".

(3) In paragraph 3 of Schedule 2 (disqualification for being appointed as or being member of a Service Authority), in sub-paragraph (1)(c), for the words from "section 429(2)(b)" to the end substitute "section 429(2) of the Insolvency Act 1986 (disabilities on revocation of county court administration order); or".

Criminal Justice and Police Act 2001 (c. 16)

12 (1) Paragraph 3 of Schedule 3 to the Criminal Justice and Police Act 2001 (persons disqualified for being appointed as or being member of the Central Police Training and Development Authority) is amended as follows.

(2) In sub-paragraph (1)(b), for the words from "section 429(2)(b)" to the end substitute "section 429(2) of the Insolvency Act 1986 (disabilities on revocation of county court administration order); or".

Police Reform Act 2002 (c. 30)

13 (1) Schedule 2 to the Police Reform Act 2002 (the Independent Police Complaints Commission) is amended as follows.

(2) In paragraph 1(5) (grounds for removal of chairman), in paragraph (e)(ii), for the words from "section 429(2)(b)" to the end substitute "section 429(2) of the Insolvency Act 1986 (disabilities on revocation of county court administration order);".

(3) In paragraph 2(6) (grounds for removal of ordinary members), in paragraph (e)(ii), for the words from "section 429(2)(b)" to the end substitute "section 429(2) of the Insolvency Act 1986 (disabilities on revocation of county court administration order);".

Railways and Transport Safety Act 2003 (c. 20)

14 (1) Paragraph 7 of Schedule 4 to the Railways and Transport Safety Act 2003, (eligibility for appointment as member of British Transport Police Authority) is amended as follows.

(2) In sub-paragraph (3)(c), for "section 429(2)(b)" substitute "section 429(2)".

Courts Act 2003 (c. 39)

15 (1) Section 98 of the Courts Act 2003 (register of judgments and orders) is amended as follows.

(2) In subsection (1)(b) (administration orders) for "section 112" substitute "Part 6".

Section 108(1)

SCHEDULE 17 Part 7A of the Insolvency Act 1986

" Part 7A Debt relief orders

Preliminary

251A Debt relief orders

(1) An individual who is unable to pay his debts may apply for an order under this Part ("a debt relief order") to be made in respect of his qualifying debts.

(2) In this Part "qualifying debt" means (subject to subsection (3)) a debt which--

(a) is for a liquidated sum payable either immediately or at some certain future time; and

(b) is not an excluded debt.

(3) A debt is not a qualifying debt to the extent that it is secured.

(4) In this Part "excluded debt" means a debt of any description prescribed for the purposes of this subsection.

Applications for a debt relief order

251B Making of application

(1) An application for a debt relief order must be made to the official receiver through an approved intermediary.

(2) The application must include--

(a) a list of the debts to which the debtor is subject at the date of the application, specifying the amount of each debt (including any interest, penalty or other sum that has become payable in relation to that debt on or before that date) and the creditor to whom it is owed;

(b) details of any security held in respect of any of those debts; and

(c) such other information about the debtor's affairs (including his creditors, debts and liabilities and his income and assets) as may be prescribed.

(3) The rules may make further provision as to--

(a) the form of an application for a debt relief order;

(b) the manner in which an application is to be made; and

(4) For the purposes of this Part an application is not to be regarded as having been made until--

(a) the application has been submitted to the official receiver; and

(b) any fee required in connection with the application by an order under section 415 has been paid to such person as the order may specify.

251C Duty of official receiver to consider and determine application

(1) This section applies where an application for a debt relief order is made.

(2) The official receiver may stay consideration of the application until he has received answers to any queries raised with the debtor in relation to anything connected with the application.

(3) The official receiver must determine the application by--

(a) deciding whether to refuse the application;

(b) if he does not refuse it, by making a debt relief order in relation to the specified debts he is satisfied were qualifying debts of the debtor at the application date;

but he may only refuse the application if he is authorised or required to do so by any of the following provisions of this section.

(4) The official receiver may refuse the application if he considers that--

(a) the application does not meet all the requirements imposed by or under section 251B;

(b) any queries raised with the debtor have not been answered to the satisfaction of the official receiver within such time as he may specify when they are raised;

(c) the debtor has made any false representation or omission in making the application or on supplying any information or documents in support of it.

(5) The official receiver must refuse the application if he is not satisfied that--

(a) the debtor is an individual who is unable to pay his debts;

(b) at least one of the specified debts was a qualifying debt of the debtor at the application date;

(6) The official receiver may refuse the application if he is not satisfied that each condition specified in Part 2 of Schedule 4ZA is met.

(7) If the official receiver refuses an application he must give reasons for his refusal to the debtor in the prescribed manner.

(8) In this section "specified debt" means a debt specified in the application.

251D Presumptions applicable to the determination of an application

(1) The following presumptions are to apply to the determination of an application for a debt relief order.

(2) The official receiver must presume that the debtor is an individual who is unable to pay his debts at the determination date if--

(a) that appears to the official receiver to be the case at the application date from the information supplied in the application and he has no reason to believe that the information supplied is incomplete or inaccurate; and

(b) he has no reason to believe that, by virtue of a change in the debtor's financial circumstances since the application date, the debtor may be able to pay his debts.

(3) The official receiver must presume that a specified debt (of the amount specified in the application and owed to the creditor so specified) is a qualifying debt at the application date if--

(a) that appears to him to be the case from the information supplied in the application; and

(b) he has no reason to believe that the information supplied is incomplete or inaccurate.

(4) The official receiver must presume that the condition specified in paragraph 1 of Schedule 4ZA is met if--

(a) that appears to him to be the case from the information supplied in the application;

(b) any prescribed verification checks relating to the condition have been made; and

(5) The official receiver must presume that any other condition specified in Part 1 or 2 of Schedule 4ZA is met if--

(a) that appears to him to have been the case as at the application date from the information supplied in the application and he has no reason to believe that the information supplied is incomplete or inaccurate;

(b) any prescribed verification checks relating to the condition have been made; and

(c) he has no reason to believe that, by virtue of a change in circumstances since the application date, the condition may no longer be met.

(6) References in this section to information supplied in the application include information supplied to the official receiver in support of the application.

(7) In this section "specified debt" means a debt specified in the application.

Making and effect of debt relief order

251E Making of debt relief orders

(1) This section applies where the official receiver makes a debt relief order on determining an application under section 251C.

(2) The order must be made in the prescribed form.

(3) The order must include a list of the debts which the official receiver is satisfied were qualifying debts of the debtor at the application date, specifying the amount of the debt at that time and the creditor to whom it was then owed.

(4) The official receiver must--

(a) give a copy of the order to the debtor; and

(b) make an entry for the order in the register containing the prescribed information about the order or the debtor.

(5) The rules may make provision as to other steps to be taken by the official receiver or the debtor on the making of the order.

(6) Those steps may include in particular notifying each creditor to whom a qualifying debt specified in the order is owed of--

(a) the making of the order and its effect,

(b) the grounds on which a creditor may object under section 251K, and

(7) In this Part the date on which an entry relating to the making of a debt relief order is first made in the register is referred to as "the effective date".

251F Effect of debt relief order on other debt management arrangements

(1) This section applies if--

(a) a debt relief order is made, and

(b) immediately before the order is made, other debt management arrangements are in force in respect of the debtor.

(2) The other debt management arrangements cease to be in force when the debt relief order is made.

(3) In this section "other debt management arrangements" means--

(a) an administration order under Part 6 of the County Courts Act 1984;

(b) an enforcement restriction order under Part 6A of that Act;

(c) a debt repayment plan arranged in accordance with a debt management scheme that is approved under Chapter 4 of Part 5 of the Tribunals, Courts and Enforcement Act 2007.

251G Moratorium from qualifying debts

(1) A moratorium commences on the effective date for a debt relief order in relation to each qualifying debt specified in the order ("a specified qualifying debt").

(2) During the moratorium, the creditor to whom a specified qualifying debt is owed--

(a) has no remedy in respect of the debt, and

(b) may not--

(i) commence a creditor's petition in respect of the debt, or

(ii) otherwise commence any action or other legal proceedings against the debtor for the debt,

except with the permission of the court and on such terms as the court may impose.

(3) If on the effective date a creditor to whom a specified qualifying debt is owed has any such petition, action or other proceeding as mentioned in subsection (2)(b) pending in any court, the court may--

(a) stay the proceedings on the petition, action or other proceedings (as the case may be), or

(b) allow them to continue on such terms as the court thinks fit.

(4) In subsection (2)(a) and (b) references to the debt include a reference to any interest, penalty or other sum that becomes payable in relation to that debt after the application date.

(5) Nothing in this section affects the right of a secured creditor of the debtor to enforce his security.

251H The moratorium period

(1) The moratorium relating to the qualifying debts specified in a debt relief order continues for the period of one year beginning with the effective date for the order, unless--

(a) the moratorium terminates early; or

(b) the moratorium period is extended by the official receiver under this section or by the court under section 251M.

(2) The official receiver may only extend the moratorium period for the purpose of--

(a) carrying out or completing an investigation under section 251K;

(b) taking any action he considers necessary (whether as a result of an investigation or otherwise) in relation to the order; or

(c) in a case where he has decided to revoke the order, providing the debtor with the opportunity to make arrangements for making payments towards his debts.

(3) The official receiver may not extend the moratorium period for the purpose mentioned in subsection (2)(a) without the permission of the court.

(4) The official receiver may not extend the moratorium period beyond the end of the period of three months beginning after the end of the initial period of one year mentioned in subsection (1).

(5) The moratorium period may be extended more than once, but any extension (whether by the official receiver or by the court) must be made before the moratorium would otherwise end.

(6) References in this Part to a moratorium terminating early are to its terminating before the end of what would otherwise be the moratorium period, whether on the revocation of the order or by virtue of any other enactment.

251I Discharge from qualifying debts

(1) Subject as follows, at the end of the moratorium applicable to a debt relief order the debtor is discharged from all the qualifying debts specified in the order (including all interest, penalties and other sums which may have become payable in relation to those debts since the application date).

(2) Subsection (1) does not apply if the moratorium terminates early.

(3) Subsection (1) does not apply in relation to any qualifying debt which the debtor incurred in respect of any fraud or fraudulent breach of trust to which the debtor was a party.

(4) The discharge of the debtor under subsection (1) does not release any other person from--

(a) any liability (whether as partner or co-trustee of the debtor or otherwise) from which the debtor is released by the discharge; or

(b) any liability as surety for the debtor or as a person in the nature of such a surety.

(5) If the order is revoked by the court under section 251M after the end of the moratorium period, the qualifying debts specified in the order shall (so far as practicable) be treated as though subsection (1) had never applied to them.

Duties of debtor

251J Providing assistance to official receiver etc

(1) The duties in this section apply to a debtor at any time after the making of an application by him for a debt relief order.

(2) The debtor must--

(a) give to the official receiver such information as to his affairs,

(b) attend on the official receiver at such times, and

as the official receiver may reasonably require for the purpose of carrying out his functions in relation to the application or, as the case may be, the debt relief order made as a result of the application.

(3) The debtor must notify the official receiver as soon as reasonably practicable if he becomes aware of--

(a) any error in, or omission from, the information supplied to the official receiver in, or in support of, the application;

(b) any change in his circumstances between the application date and the determination date that would affect (or would have affected) the determination of the application.

(4) The duties under subsections (2) and (3) apply after (as well as before) the determination of the application, for as long as the official receiver is able to exercise functions of the kind mentioned in subsection (2).

(5) If a debt relief order is made as a result of the application, the debtor must notify the official receiver as soon as reasonably practicable if--

(a) there is an increase in his income during the moratorium period applicable to the order;

(b) he acquires any property or any property is devolved upon him during that period;

(c) he becomes aware of any error in or omission from any information supplied by him to the official receiver after the determination date.

(6) A notification under subsection (3) or (5) must give the prescribed particulars (if any) of the matter being notified.

Objections, investigations and revocation

251K Objections and investigations

(1) Any person specified in a debt relief order as a creditor to whom a specified qualifying debt is owed may object to--

(a) the making of the order;

(b) the inclusion of the debt in the list of the debtor's qualifying debts; or

(2) An objection under subsection (1) must be--

(a) made during the moratorium period relating to the order and within the prescribed period for objections;

(b) made to the official receiver in the prescribed manner;

(d) supported by any information and documents as may be prescribed;

and the prescribed period mentioned in paragraph (a) must not be less than 28 days after the creditor in question has been notified of the making of the order.

(3) The official receiver must consider every objection made to him under this section.

(4) The official receiver may--

(a) as part of his consideration of an objection, or

(b) on his own initiative,

carry out an investigation of any matter that appears to the official receiver to be relevant to the making of any decision mentioned in subsection (5) in relation to a debt relief order or the debtor.

(5) The decisions to which an investigation may be directed are--

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