Insolvency technical update – September 2019
By David Menzies, Director of Practice
17 October 2019
Insolvency technical update – your round-up of recent developments in insolvency.
Changes to protect tax in insolvency cases
ICAS, R3 and other stakeholders have written to the Chancellor highlighting concerns that proposals to reintroduce HMRC as a secondary preferential creditor in respect of certain tax debts will harm business and undermine the UK's restructuring framework. The letter follows on from the publication of draft legislation, to be introduced in Finance Bill 2019-20, intended to have effect from 6 April 2020.
The Debt Arrangement Scheme (Scotland) Amendment Regulations 2019
Following evidence from a number of stakeholders, the Economy, Energy and Fair Work Committee has recommended that the DAS (Scotland) Amendment Regulations 2019 be approved by 5 votes to 4. The Regulations should come into effect on 4 November 2019.
Dear IP
The Insolvency Service has issued Dear IP 90, which provides information relevant to users of the Insolvency Services Account (ISA) and also references the government’s call for evidence seeking views on the workings of the current regulatory framework for insolvency practitioners.
Funeral expenses in sequestration
The Accountant in Bankruptcy’s Notes for Guidance for Trustee’s were updated earlier this year, with one of the key changes being revised guidance in relation to the payment of funeral expenses. Following further dialogue with the Accountant in Bankruptcy, that change is revisited in more detail in a follow-up article.
Judicial Factors consultation
A consultation has been launched seeking views on the Scottish Law Commission's recommendations and draft bill to modernise judicial factors. Responses are requested before the closing date of 20 November 2019.
Accountant in Bankruptcy annual report
The Accountant in Bankruptcy has published its annual report for 2018-19. The report reveals that dividends from bankruptcy repaid £18 million to creditors, while £24 million was paid out through dividends from protected trust deeds.
Legal Update
Discover (Northampton) Limited and others v Debenhams Retail Limited and others [2019] EWHC 2441 (Ch) The High Court has rejected an application brought by a group of landlords to challenge CVA proposed by Debenhams Retail Limited (via LexisNexis)
Martin v McLaren Construction Ltd [2019] EWHC 2059 (Ch) The High Court considered whether it should exercise its discretion to set aside a statutory demand made in respect of a guarantee liability where no prior demand under the guarantee had been made (via Lexology)
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