Who is the official receiver?

Official receivers are civil servants in The Insolvency Service and are officers of the court. The court notifies them about a bankruptcy. Your local official receiver is responsible through his or her staff for administering the initial stage, at least, of your insolvency case. This stage includes collecting and protecting any assets and investigating the causes of the bankruptcy.

What are my duties?

As a bankrupt, you have a duty to comply with the official receiver’s request to provide information about the financial affairs, including attending for interview as and when asked. More information about your duties is available in our leaflets ‘Guide to Bankruptcy’, which are available from your local official receiver’s office. 

How does the official receiver obtain information from me? 

The official receiver’s staff will contact you immediately if they know that action is urgently needed in relation to you and your assets Otherwise, they will contact you within 2 working days of receiving the insolvency order. Usually they will arrange an appointment for you to attend the official receiver’s office for interview, normally on a date that is convenient to all parties. Alternatively, and in relation to bankruptcy, the official receiver may suggest a telephone interview. Telephone interviews are usually carried out where:

a)                   you have presented your own petition

b)                    you have not recently traded

c)                    you have not previously been made bankrupt

d)                    a telephone number for you is available.

If you are offered a telephone interview but would prefer to be interviewed in person, please tell the official receiver. Whether you are interviewed in person or by telephone, you will receive a letter setting out what is required of you and you may be required to complete a questionnaire. The more organised you are, the more straightforward the process will be. If you have presented your own bankruptcy petition you may be interviewed by the official receiver, at court or at the official receiver’s office, directly following the making of the bankruptcy order.

What should I do before the interview?

Before the interview you should do 3 things:

       1)         Telephone the official receiver immediately to confirm the appointment if   you have not already done so or if:

a) you have any infirmity, disability or other difficulty which you consider may require special facilities when attending his/her office or during the telephone interview

b) there are any matters that need to be sorted out urgently

c) you need to rearrange the appointment

                  d) the official receiver has requested a lot of paperwork or accounting records and you need more time to collect them.

2)                   Fill in the questionnaire (if you have been asked to complete one) and make a note of any points you do not understand. Or you can fill in this form online on our website at insolvency.gov.uk in 'Complete your forms online'.

3)                   Collect all the financial records, paperwork, and any other information you will need for the interview. This means all accounting records; financial papers (for example letters, statements, bank records, hire-purchase agreements, credit card statements); any other relevant paperwork about you.

If you are having a telephone interview, you must return the completed questionnaire to the official receiver by a fixed date. If you fail to do so or do not fully complete the questionnaire, you may be asked to attend for interview in person. You should have the financial records, paperwork and any other information available when the telephone interview takes place. If you are being interviewed in person, you should take the completed questionnaire and the financial records, paperwork and any other information with you to the interview.

Do not ignore the official receiver’s staff in the hope that they will go away. They will not. If you do not co-operate, you may have to attend court to be questioned and could even be arrested if you still fail to co-operate. In a bankruptcy, you could also have your discharge from bankruptcy proceedings suspended, which would mean that your bankruptcy could last much longer than the normal 12 months.

What happens at the first interview at the office?

You should go to the reception desk when you arrive. You can expect to be seen at the time of the appointment, or certainly no later than 5 minutes after the fixed appointment time. Then, in a private interview room:

a)         your questionnaire (if you have been asked to complete one) will be checked by a member of the official receiver’s staff. If you have not completed the questionnaire, you will be asked to do so there and then

b)         you will be interviewed by an examiner (a member of staff who is a specialist in insolvency matters) who will go into the details of your assets and debts, and the facts and circumstances that led to the insolvency

c)         you should hand over all your financial records and papers.

They will be examined and recorded then or at a later interview and will be kept by the official receiver.

You should feel free to ask any questions about the proceedings or your case when you are at the official receiver’s office. Depending on the nature of your case, the interview may take 2-3 hours to complete.

What happens at the first telephone interview?

You will be telephoned by an examiner at the agreed date and time. The examiner will:

a)         check the information in the questionnaire (if you have been asked to  complete one)

b)         ask for any necessary additional information about your assets and debts, and the facts and circumstances that led to the insolvency

c)         deal with any queries you may have about the proceedings or your case.

The examiner will also tell you if you need to supply further information relating to your affairs. Telephone interviews usually take at least half an hour, and may take longer.

Will I need to be interviewed again? 

You may be asked to attend another appointment, particularly if:

a)         the examiner needs more time to complete enquiries into your affairs

b)         you cannot, or do not, provide all the financial records requested by the official receiver

c)         the examiner needs more details of your assets, debts and financial affairs

d)         you cannot provide all the information the official receiver needs

e)         you do not arrive for any appointment

What happens next? 

After the interview, the official receiver will check the information you have given. He or she will issue a report to creditors, setting out your assets and debts. This report will usually be issued within 8 (but in any event within 12) weeks of the insolvency order. If there are material assets, he or she may seek the appointment of a private sector insolvency practitioner to act as trustee or liquidator to deal with the realisation and distribution of the assets. To do this, the official receiver will either call a meeting of creditors to enable them to appoint a practitioner or ask the Secretary of State to make an appointment. If a meeting of creditors is appropriate, it will usually be held within 12 weeks (but in any event within 4 months) of the insolvency order. You may be asked to attend the meeting of creditors.

 You will be notified if an insolvency practitioner is appointed as trustee. You will need to help the trustee to deal with your or the affairs by giving your full co-operation. If there are no material assets, the official receiver will continue to deal with everything.

How long will the process take?

What happens next, and how long it takes, depends on the complexity of the case. If you have provided all the necessary information and no problems are expected in dealing with the assets, you may not hear from the official receiver again. Any remaining matters, such as telling the official receiver of any change of address, may be dealt with by letter or telephone. If your trustee makes a payment to your creditors, he or she may place an advertisement about your bankruptcy in a newspaper asking creditors to submit their claims. If it takes your trustee a long time to deal with an asset, this advertisement may appear several years after the bankruptcy order.

Length of bankruptcy.

 In a bankruptcy, you will normally remain bankrupt for a maximum of 12 months. This period may be shorter if the official receiver concludes his or her enquiries into your affairs sooner and files a notice in court.

After this time you will be automatically discharged from the restrictions of bankruptcy. If your conduct has been dishonest or you have been in some way to blame for your bankruptcy, a bankruptcy restrictions order may be made against you. This will mean you will continue to be subject to the restrictions of bankruptcy for a further 2-15 years. If you fail to co-operate with the official receiver or trustee, the court can be asked to suspend the discharge period. If the court agrees, your bankruptcy will only end when the suspension has been lifted. Discharge from bankruptcy does not end your trustee's administration of any assets that became part of your bankruptcy estate.

Co-operation. The more difficulty the official receiver has in finding out what caused the insolvency or administering the assets, the longer the whole process will take. As part of the process, he or she may require you to:

a)         submit a sworn statement of affairs (a summary of your assets and debts)

b)         provide an account of all dealings in cash and goods

If you do not co-operate with the official receiver, he or she may also apply to the court for your public examination. This means you will be questioned in open court about your financial affairs, dealings and property. Your creditors may also be there and can ask you questions as well.

Under the insolvency and other legislation there are provisions about criminal offences and unfit conduct by bankrupts. The official receiver will report to The Insolvency Service’s headquarters if there seems to be evidence of criminality or unfitness. The official receiver does not start out by thinking that every bankrupt has committed offences or is unfit – his or her job is to establish the facts. In the vast majority of cases, those facts do not suggest that it would be in the public interest to begin criminal or bankruptcy restrictions proceedings.

About company receivership

A company is usually placed into receivership by a secured lender (usually a bank or a financial institution) who holds a registered charge or mortgage debenture however in rare circumstances; a Court can also appoint a company receiver.

A company receiver is generally appointed to ensure repayment of the charge or security holders outstanding debt and the receiver achieves this by taking control of company assets and selling all or part of the assets subject to a charge.

The company receiver reports and accounts directly to the secured lender and must pay any money recovered from the company's assets to the secured lender. The only exception to this is that in certain circumstances the company receiver is required to pay employee entitlements before payment to the charge holder.

In short, the company receiver acts in the best interest of the secured creditor – not the unsecured creditors.

A company receiver is not required to liaise with general unsecured creditors but is required to lodge a Report as to the company's affairs with the courts within 30 days of his appointment as receiver.

Further, the company receiver must take reasonable care to ensure market value or the best price reasonably obtainable is achieved for the sale of company assets.

A company receiver usually has very extensive powers and in most cases when a company goes into receivership a company receiver will have the power to:

• trade-on the business with a view to selling it as a going concern; or
• break-up the business and sell individual assets.

The directors' powers are suspended on the appointment of a company receiver and the receiver will assume total control of the company. A director will not be able to run the company any in any way after a company receiver has been appointed.

A company can be placed into liquidation notwithstanding a company receiver has been appointed, however, the receiver will have full control of the company and its assets notwithstanding the liquidators appointment.

If the secured creditor is paid out in full, any surplus is payable to the liquidator. If no liquidator had been appointed the surplus, after the secured creditor has been satisfied, is paid to the company.

For more information about company receivership, contact the Directors Helpline on 0845 430 7676 today.

Director Disqualification

PROCEDURE FOR DIRECTORS DISQUALIFICATION

Typically the Claim Form (which will be the Court document setting out what the DTI is complaining of and what they are asking the Court to do) accompanied by perhaps one or two Affidavits of Civil Servants setting out minor details of the matter together with what is usually a very substantial Affidavit from the liquidator of the company in question which contains the detail of the reasons for disqualification will be served upon the defendants.

We have a team of Experts who can help with Directors Disqualifications, call out HELPLINE on 0800 24 0800

 What do they mean? This is a brief explanation of some of the terms you may come across in insolvency proceedings. Please note that this glossary is for general guidance only. Many of the terms have a specific technical meaning in certain contexts that may not be covered here. Read the rest of this entry

Yes. It is possible to make an Application pursuant to Section 17 CDDA for leave to act as a company director or in a lesser capacity for example as a manager within the structure of a limited company. Typically these Applications are made concurrently with either the Trial of the matter, (i.e. at the end of the Trial if the defendant is unsuccessful) or if the matter has been compromised by way of Carecraft proceedings at the Carecraft Hearing. The reason for this is that it saves legal costs of both the DTI and the current director.

The Court will not always grant these Applications and the Applications require careful consideration. Therefore the director should ensure that he or she seeks legal advice and also advice from his or her accountant in order to maximise the chances of success of such Application.

Typically, the Application will only be granted if the director can show that major changes have taken place in the method of conducting business of the new company by comparison to the company liquidation which will be the subject of the proceedings. In addition, the new company will of course have to be trading solvent.

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For those who have little or no knowledge concerning the bankruptcy / Insolvency laws, then we would advise you of the need to look for a insolvency practitioner to help you understand your options. When You Meet With an Insolvency Practitioner There are many aspects of

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