[15-05-2006] Dear IP 01
Number 1
20 January 1993
Dear Insolvency Practitioner
This is the first letter in the "dear IP" series whereby I hope to be able in this issue and in future issues to explain changes in the legislation, provide clarification or interpretation of insolvency law when problems arise and to provide administrative advice for the proper conduct of your dealings with the Insolvency Service.
INSOLVENCY SERVICE STRUCTURE
The first matter I would like to deal with is to explain the structure in the Insolvency Service in order that Practitioners, when sending correspondence or seeking advice, may direct it to the proper person or section within the Insolvency Service.
I have attached at Appendix A a senior officer structure chart.
The Insolvency Service has two distinct functions, namely the Official Receiver's function under Mrs McKay, and the Departmental function under Mr Gawley. The Official Receiver has responsibility for the investigation of companies wound up by the High Court, and individuals and partnerships adjudicated bankrupt. In addition the Official Receiver will act as liquidator or trustee in the above insolvencies when it has not been possible or appropriate to appoint an Insolvency Practitioner.
The Departmental function covers such matters as Directors Disqualification including the prosecution of cases; the licensing and monitoring of Insolvency Practitioners; changes to the legislation; acting as a liquidation or creditors' committee; approving special bank accounts and all the activities carried out in the General Office including the keeping of the Insolvency Account, yearly estate accounts, proof of debt and the payment of dividends.
THE CHEQUES ACT 1992
Some Practitioners have written to me concerning the problems brought about by the Cheques Act 1992 and in particular what procedure should be applied in relation to crossed cheques.
The procedure which will come into effect from the date of this letter is as follows:
(a) uncrossed cheques whether or not payable to the Insolvency Account or to the Insolvency Service and received by the Official Receiver or a commercial Insolvency Practitioner shall be lodged, after endorsement, to the Insolvency Account in the normal way;
(b) cheques crossed "A/c payee" or "A/c payee only" received by Insolvency Practitioners other than the Official Receiver and not made payable to the Insolvency Account or to the Insolvency Service shall be lodged, after endorsement, to a client account, subject to the petitioner providing indemnities to the bank where required. The amounts lodged to the clients' account when cleared shall be remitted, without deductions, in accordance with Regulation 4, to the Insolvency Account in the normal way.
Practitioners when requesting money in future, e.g. recovery of debts, should instruct the payee to make the cheque payable to the Insolvency Account or the Insolvency Service.
NOTICES TO BE ADVERTISED IN BELFAST GAZETTE OR NEWSPAPER
It has been brought to my attention that there have been problems over the advertising of certain notices in the Belfast Gazette and appropriate newspapers. I should like to highlight two particular areas of concern:
(i) where a liquidator is appointed by a meeting of the company/creditors/contributories in a compulsory or voluntary winding up a notice of appointment must be advertised in an appropriate newspaper (see Rule 4.113);
(ii) in both members' and creditors' voluntary liquidations a notice of resolution to wind up voluntarily must be published in the Belfast Gazette (Insolvency Order, Art. 71).
To clarify matters the following is a list of statutory notices which should be advertised in the Belfast Gazette and/or such newspaper as the Insolvency Practitioner thinks most appropriate for ensuring that the matter comes to the notice of the company's creditors/contributories.
Administrators
Rule 2.12 - 'Notice of Administration Order (for newspaper or Belfast
Gazette)'.
This notice must be advertised once in the Belfast Gazette and once in an appropriate newspaper. The prescribed form for giving such notice is Form 2.06 in Schedule 2 to the Insolvency Rules (NI) 1991.
Administrative Receivers
Rule 3.03 - 'Notice of appointment of Administrative Receiver (for
newspaper or Belfast Gazette)'.
This notice must be advertised once in the Belfast Gazette and once in an appropriate newspaper. The prescribed form for giving such notice is Form 3.02 in Schedule 2 to the Insolvency Rules (NI) 1991.
Liquidators
Rule 4.113 - Notice of appointment of Liquidator.
This rule requires a liquidator who has been appointed by a meeting of creditors/contributories/the company, on receiving a certificate of appointment, to give notice of appointment in an appropriate newspaper. There is no prescribed form for giving such notice.
(VOLUNTARY LIQUIDATIONS ONLY)
Article 95(1) - 'Notice of appointment of Liquidator'.
This notice must be advertised in the Belfast Gazette within 14 days of the liquidator's appointment. The prescribed form for giving such notice is Form 558a in Schedule 2 to the Companies (Forms)(Amendment No.3) Regulations (NI) 1991.
Article 71 - Notice of resolution to wind up voluntarily.
Notice of a resolution for voluntary winding up must be advertised in the Belfast Gazette within 14 days of the resolution being passed. There is no prescribed form for giving such notice.
The date when the resolution was passed should be stated in the notice as it is from then that the company goes into liquidation.
Yours faithfully
W R NESBITT
Director of Insolvency
