Paragraph 16 Sections 141, 301 and 302: Creditors' Committee: Insolvent partnership and membersI1

Sections 141, 301 and 302 are modified so as to read as follows—

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( 1)

This section applies where insolvency orders are made in respect of an insolvent partnership and one or more of its insolvent members by virtue of article 8 of the Insolvent Partnerships Order 1994.

(2)

If both the creditors of the partnership and the creditors of any insolvent members decide that a liquidation committee should be established, a liquidation committee is to be established in accordance with the rules.

(3)

A “liquidation committee” is a committee having such functions as are conferred on it by or under this Act.

(4)

The responsible insolvency practitioner must seek a decision from the creditors of the partnership and of any insolvent members as to whether a liquidation committee should be established if requested, in accordance with the rules, to do so by one-tenth in value of the creditors.

Functions and membership of creditors' committee

141A

(1)

The committee established under section 141 shall act as liquidation committee for the partnership and for any corporate member against which an insolvency order has been made, and as creditors' committee for any individual member against whom an insolvency order has been made, and shall as appropriate exercise the functions conferred on liquidation and creditors' committees in a winding up or bankruptcy by or under this Act.

(2)

The rules relating to liquidation committees are to apply (with the necessary modifications and with the exclusion of all references to contributories) to a committee established under section 141.

(3)

Where the appointment of the responsible insolvency practitioner also takes effect in relation to a further insolvent member under section 136A(5) or 137A(3), the practitioner may appoint any creditor of that member (being qualified under the rules to be a member of the committee) to be a additional member of any creditors' committee already established under section 141, provided that the creditor concerned consents to act.

(4)

The court may at any time, on application by a creditor of the partnership or of any insolvent member against whom an insolvency order has been made, appoint additional members of the creditors' committee.

(5)

If additional members of the creditors' committee are appointed under subsection (3) or (4), the limit on the maximum number of members of the committee specified in the rules shall be increased by the number of additional members so appointed.

(6)

The creditors' committee is not to be able or required to carry out its functions at any time when the official receiver is responsible insolvency practitioner of the partnership and of its insolvent member or members; but at any such time its functions are vested in the Secretary of State except to the extent that the rules otherwise provide.

(7)

Where there is for the time being no creditors' committee, and the responsible insolvency practitioner is a person other than the official receiver, the functions of such a committee are vested in the Secretary of State except to the extent that the rules otherwise provide.”.