An officer of the Insolvency Service
The Insolvency Service is an executive agency of the United Kingdom's Department for Business, Innovation and Skills which:* administers and investigates the affairs of bankrupts, of companies and partnerships wound up by the court, and establishes why they became insolvent;* acts as...
of the United Kingdom, the Official Receiver (OR)
is an officer of the court to which he is attached. The OR is therefore answerable to the courts for carrying out the courts' orders and for fulfilling his duties under law. He also acts on directions, instructions and guidance from the Service's Inspector General or, less often, from the Secretary of State for Business, Enterprise and Regulatory Reform.
An OR has the following responsibilities:
- acting as interim receiver or provisional liquidator
In law, a liquidator is the officer appointed when a company goes into winding-up or liquidation who has responsibility for collecting in all of the assets of the company and settling all claims against the company before putting the company into dissolution....
: At any time after a petition for an insolvency order under s122 of the Insolvency act 1986 has been presented, the court may appoint the OR as interim receiver (for an individual) or as provisional liquidator (for a company). This is to protect a debtor's property, or take control of a company' affairs, pending the outcome of the hearing of the petition;
- acting as receiver, trustee or liquidator: The OR becomes receiver and manager when a court makes a bankruptcy order against an individual. The OR becomes the first liquidator when the court makes a winding up order against a company. The OR is responsible for protecting the assets of the insolvent person or company and will take immediate steps to secure any property or other assets. If no private sector insolvency practitioner (IP) is subsequently appointed, the OR becomes the trustee of the insolvent person's estate or the liquidator or remains the liquidator of the company; and
- acting as supervisor: in a fast-track voluntary arrangement proposed by a bankrupt.
The bankrupt or the company directors must give the OR information about their own or the company's affairs. The OR will interview them, examine their financial records, and make background enquiries of others who have had dealings with them (e.g. banks, accountants etc.). In every case, the OR reports to creditors and shareholders giving details of assets and liabilities.
Depending on the nature and monetary value of the assets, the OR may arrange a meeting of the creditors (and of contributories in a winding up) to consider appointing an IP to act as trustee or liquidator in his place. Alternatively, the OR may consult the creditors and ask the Secretary of State to appoint an IP. (This is usually done when such an appointment needs to be made quickly - for instance, when there are large amounts of perishable goods).
If an IP is appointed, the OR will hand over administration. Otherwise, the OR acts as trustee or liquidator to sell the assets, distribute the proceeds to creditors, and complete the administration of the estate (mostly achieved within 12 months of the insolvency order). Whether or not the OR continues as trustee or liquidator, he remains responsible for investigating the insolvent's affairs.
The office of official receiver was established by the Bankruptcy Act 1883 (46 & 47 Vict c 52). His role was originally confined to personal bankruptcy
Personal bankruptcy is a procedure which, in certain jurisdictions, allows an individual to declare bankruptcy. In other jurisdictions, bankruptcies are reserved for corporations.-Canada:...
, but it was extended to companies in compulsory liquidation by the Companies (Winding Up) Act 1890 (53 & 54 Vict c 63).
- Simplified Individual Voluntary Arrangement
In the United Kingdom, a Simplified IVA was a proposed new form of IVA , which would have been a formal alternative of clearing debt without being declared bankrupt.The new regime was likely to have been two tiers:...
Bankruptcy is a legal status of an insolvent person or an organisation, that is, one that cannot repay the debts owed to creditors. In most jurisdictions bankruptcy is imposed by a court order, often initiated by the debtor....
In law, liquidation is the process by which a company is brought to an end, and the assets and property of the company redistributed. Liquidation is also sometimes referred to as winding-up or dissolution, although dissolution technically refers to the last stage of liquidation...
- Administrative Receiverships
- Trust Deeds
A trust deed is a voluntary but formal arrangement that is used by Scottish residents where a debtor grants a ‘trust deed’ in favour of the trustee which transfers their estate to the trustee for the benefit of creditors. It can be a way for people to deal with debt problems...
(only available in Scotland)