Debt Relief Act (Northern Ireland) 2010

Document Number:2010 CHAPTER 16
 
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An Act to make provision about the relief of debt of individuals and for connected purposes.

[15 th December 2010]

BE IT ENACTED by being passed by the Northern Ireland Assembly and assented to by Her Majesty as follows:

Debt relief orders

  1. In the Order of 1989—

    (a) omit the heading to Parts 8 to 10 (insolvency of individuals; bankruptcy) immediately following Article 208;

    (b) before the heading to Part 8 (individual voluntary arrangements) insert—

    “PARTS 7 A TO 10 INSOLVENCY OF INDIVIDUALS; BANKRUPTCY

    PART 7 ADEBT RELIEF ORDERS

    Preliminary

    Debt relief orders

    208 A.—(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 paragraph (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 paragraph.

    Applications for a debt relief order

    Making of application

    208 B.—(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

    (c) information and documents to be supplied in support of an application.

    (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 Article 361 has been paid to such person as the order may specify.

    Duty of official receiver to consider and determine application

    208 C.—(1) This Article 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 Article.

    (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 Article 208 B;

    (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;

    (c) each of the conditions set out in Part 1 of Schedule 2 ZA is met.

    (6) The official receiver may refuse the application if he is not satisfied that each condition specified in Part 2 of Schedule 2 ZA 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 Article “specified debt” means a debt specified in the application.

    Presumptions applicable to the determination of an application

    208 D.—(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 2 ZA 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

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

    (5) The official receiver must presume that any other condition specified in Part 1 or 2 of Schedule 2 ZA 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 Article to information supplied in the application include information supplied to the official receiver in support of the application.

    (7) In this Article “specified debt” means a debt specified in the application.

    Making and effect of debt relief order

    Making of debt relief orders

    208 E.—(1) This Article applies where the official receiver makes a debt relief order on determining an application under Article 208 C.

    (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 Article 208 K, and

    (c) any other prescribed information.

    (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”.

    Effect of debt relief order on administration order

    208 F. Where—

    (a) a debt relief order is made; and

    (b) immediately before the order is made, an administration order under Part 6 of the Judgments Enforcement Order is in force in respect of the debtor,

    the administration order ceases to be in force when the debt relief order is made.

    Moratorium from qualifying debts

    208 G.—(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 High 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 paragraph (2)(b) pending in any court, that 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 that court thinks fit.

    (4) In paragraph (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 Article affects the right of a secured creditor of the debtor to enforce his security.

    The moratorium period

    208 H.—(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 Article or by the High Court under Article 208 M.

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

    (a) carrying out or completing an investigation under Article 208 K;

    (b) taking any action he considers necessary (whether as a result...

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