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Bankruptcy (Scotland) Act 1985 (repealed)

Changes to legislation:

Bankruptcy (Scotland) Act 1985 (repealed) is up to date with all changes known to be in force on or before 15 August 2018. There are changes that may be brought into force at a future date. Help about Changes to Legislation

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Revised legislation carried on this site may not be fully up to date. Changes and effects are recorded by our editorial team in lists which can be found in the ‘Changes to Legislation’ area. Where those effects have yet to be applied to the text of the legislation by the editorial team they are also listed alongside the affected provisions when you open the content using the Table of Contents below.

  1. Introductory Text

  2. Administration of bankruptcy

    1. 1. Accountant in Bankruptcy.

    2. 1A.Supervisory functions of the Accountant in Bankruptcy.

    3. 1B.Performance of certain functions of the Accountant in Bankruptcy.

    4. 1C.Directions.

    5. 1D.Conduct of proceedings in the sheriff court

    6. 2.Appointment and functions of the trustee in the sequestration

    7. 3.Functions of the trustee

    8. 3A.Application to Accountant in Bankruptcy for a direction

    9. 4. Commissioners.

  3. Moratorium on diligence

    1. 4A.Notice of intention to apply: debtor application etc.

    2. 4B.Notice of intention to apply: sequestration of estate under section 6

    3. 4C.Moratorium on diligence

    4. 4D.Period of moratorium

  4. Petitions for sequestration

    1. 5. Sequestration of the estate of living or deceased debtor.

    2. 5A.Debtor applications by low income, low asset debtors

    3. 5B.Certificate for sequestration

    4. 5C.Money advice

    5. 5D.Assessment of debtor’s contribution

    6. 6. Sequestration of other estates.

    7. 6A.Petition for sequestration of estate: provision of information

    8. 6B.Debtor application: provision of information

    9. 7. Meaning of apparent insolvency.

    10. 8. Further provisions relating to presentation of petitions.

    11. 8A.Further provisions relating to debtor applications

    12. 9. Jurisdiction.

    13. 10.Duty to notify existence of concurrent proceedings for sequestration or analogous remedy

    14. 10A.Powers in relation to concurrent proceedings for sequestration or analogous remedy

    15. 11. Creditor’s oath.

  5. Award of sequestration and appointment and resignation of interim trustee

    1. 11A.Debtor application: incomplete application

    2. 11B.Refusal of debtor application: inappropriate application

    3. 12. When sequestration is awarded.

    4. 13.Resignation, removal etc. of interim trustee.

    5. 13A.Termination of interim trustee's functions where not appointed as trustee

    6. 13B.Termination of Accountant in Bankruptcy's functions as interim trustee where not appointed as trustee

    7. 14.Registration of warrant or determination of debtor application

    8. 15. Further provisions relating to award of sequestration.

    9. 16. Petitions for recall of sequestration.

    10. 17. Recall of sequestration by sheriff.

    11. 17A.Application to Accountant in Bankruptcy for recall of sequestration

    12. 17B.Application under section 17A: further procedure

    13. 17C.Determination of outlays and remuneration

    14. 17D.Recall of sequestration by Accountant in Bankruptcy

    15. 17E.Recall where Accountant in Bankruptcy the trustee

    16. 17F.Reference to sheriff

    17. 17G.Recall of sequestration by Accountant in Bankruptcy: review and appeal

  6. Initial stages of sequestration

    1. 18. Interim preservation of estate.

    2. 19.Statement of assets and liabilities etc.

    3. 20. Trustee’s duties on receipt of list of assets and liabilities.

    4. 20A.Statutory meeting.

  7. Statutory meeting of creditors and trustee vote

    1. 21. Calling of statutory meeting.

    2. 21A.Calling of statutory meeting

    3. 21B.Procedure where no statutory meeting called.

    4. 22. Submission of claims for voting purposes at statutory meeting.

    5. 23.Proceedings at statutory meeting before trustee vote

    6. 23A.Summary administration.

    7. 24.Trustee vote

    8. 25.Appointment of replacement trustee

    9. 25A.Applications to Accountant in Bankruptcy: procedure

    10. 25B.Applications and appeals to sheriff: procedure

    11. 26.Provisions relating to termination of original trustee's functions

    12. 26A.Accountant in Bankruptcy to account for intromissions.

    13. 27.Discharge of original trustee

  8. Replacement of trustee

    1. 28.Resignation and death of trustee

    2. 28A.Replacement of trustee acting in more than one sequestration

    3. 28B.Determination etc. under section 28A: review

    4. 29.Removal of trustee and trustee not acting

  9. Election, resignation and removal of commissioners

    1. 30. Election, resignation and removal of commissioners.

  10. Vesting of estate in trustee

    1. 31. Vesting of estate at date of sequestration.

    2. 31ZA.Proceedings under EC Regulation: modified definition of “estate”

    3. 31A. Property subject to restraint order

    4. 31AA.Property released from detention

    5. 31B. Property in respect of which receivership or administration order is made

    6. 31BA.Property in respect of which realisation order made

    7. 31C. Property subject to certain orders where confiscation order discharged or quashed

    8. 32. Vesting of estate, and dealings of debtor, after sequestration.

    9. 32A.Debtor contribution order

    10. 32B.Debtor contribution order: payment period and intervals

    11. 32C.Debtor contribution order: review and appeal

    12. 32D.Effect of debtor contribution order

    13. 32E.Deductions from debtor’s earnings and other income

    14. 32F.Variation and removal of debtor contribution order by trustee

    15. 32G.Payment break

    16. 32H.Sections 32F and 32G: review and appeal

    17. 33. Limitations on vesting.

  11. Safeguarding of interests of creditors of insolvent persons

    1. 34. Gratuitous alienations.

    2. 35. Recalling of order for payment of capital sum on divorce.

    3. 36. Unfair preferences.

    4. 36A. Recovery of excessive pension contributions.

    5. 36B. Orders under section 36A.

    6. 36C. Orders under section 36A: supplementary.

    7. 36D. Recovery of excessive contributions in pension-sharing cases.

    8. 36E. Recovery orders.

    9. 36F. Recovery orders: supplementary.

  12. Effect of sequestration on diligence

    1. 37. Effect of sequestration on diligence.

  13. Administration of estate by trustee

    1. 38.Taking possession of estate by trustee

    2. 39. Management and realisation of estate.

    3. 39A.Debtor's home ceasing to form part of sequestrated estate

    4. 40.Power of trustee in relation to the debtor's family home

    5. 41. Protection of rights of spouse against arrangements intended to defeat them.

    6. 41A.Protection of rights of civil partner against arrangements intended to defeat them

    7. 42.Contractual powers of trustee

    8. 43.Money received by trustee

    9. 43A.Debtor's requirement to give account of state of affairs

    10. 43B.Financial education

  14. Examination of debtor

    1. 44. Private examination.

    2. 45. Public examination.

    3. 46. Provisions ancillary to sections 44 and 45.

    4. 47. Conduct of examination.

  15. Submission and adjudication of claims

    1. 48.Submission of claims to trustee

    2. 49. Adjudication of claims.

  16. Entitlement to vote and draw dividend

    1. 50. Entitlement to vote and draw dividend.

  17. Distribution of debtor’s estate

    1. 51. Order of priority in distribution.

    2. 52. Estate to be distributed in respect of accounting periods.

    3. 53. Procedure after end of accounting period.

    4. 53A.Modification of procedure under section 53 where Accountant in Bankruptcy is trustee

  18. Discharge of debtor

    1. 54.Discharge where Accountant in Bankruptcy not the trustee

    2. 54A.Discharge where Accountant in Bankruptcy the trustee

    3. 54B.Discharge of debtor: review and appeal

    4. 54C.Debtor to whom section 5(2ZA) applies: discharge

    5. 54D.Deferral of discharge where debtor cannot be traced

    6. 54E.Debtor not traced: new trustee

    7. 54F.Debtor not traced: subsequent debtor contact

    8. 54G.Subsequent debtor contact: review and appeal

    9. 55. Effect of discharge under section 54.

    10. 55A.Discharge under section 54C: conditions

    11. 55B.Section 55A: sanctions

    12. 56. Discharge on Composition.

  19. Bankruptcy restrictions orders and undertakings

    1. 56A.Bankruptcy restrictions order

    2. 56B.Grounds for making order

    3. 56C.Application of section 67(9)

    4. 56D.Timing for making an order

    5. 56E.Duration of order and application for annulment

    6. 56F.Interim bankruptcy restrictions order

    7. 56G.Bankruptcy restrictions undertaking

    8. 56H.Bankruptcy restrictions undertakings: application of section 67(9)

    9. 56J.Effect of recall of sequestration

    10. 56K.Effect of discharge on approval of offer of composition

  20. Discharge of trustee

    1. 57.Discharge of trustee

    2. 58. Unclaimed dividends.

    3. 58A.Discharge of Accountant in Bankruptcy

    4. 58B.Assets discovered after trustee discharge: appointment of trustee

    5. 58C.Assets discovered after trustee discharge: notice

    6. 58D.Assets discovered after trustee discharge: appeal

  21. Voluntary trust deeds for creditors

    1. 59. Voluntary trust deeds for creditors.

    2. 59A.Application for conversion to sequestration

    3. 59B.Contents of affidavit

    4. 59C.Power of Accountant in Bankruptcy

  22. Miscellaneous and supplementary

    1. 60. Liabilities and rights of co-obligants.

    2. 60A.Member State liquidator deemed creditor

    3. 60B.Trustee’s duties concerning notices and copies of documents

    4. 61. Extortionate credit transactions.

    5. 62. Sederunt book and other documents.

    6. 63. Power of court to cure defects in procedure.

    7. 63A.Power of Accountant in Bankruptcy to cure defects in procedure

    8. 63B.Decision under section 63A: review

    9. 63C.Review of decisions by Accountant in Bankruptcy: grounds of appeal

    10. 64.Debtor to co-operate with trustee

    11. 65. Arbitration and compromise.

    12. 66. Meetings of creditors and commissioners.

    13. 67. General offences by debtor etc.

    14. 68. Summary proceedings.

    15. 69.Outlays of insolvency practitioner in actings as interim trustee or trustee

    16. 69A.Fees for the Accountant in Bankruptcy.

    17. 70. Supplies by utilities.

    18. 71. Edinburgh Gazette.

    19. 71A.Further duty of Accountant in Bankruptcy

    20. 71B.Disqualification provisions: power to make orders

    21. 71C.Regulations: applications to Accountant in Bankruptcy etc.

    22. 72.Regulations.

    23. 72ZA.Modification of regulation making powers

    24. 72A.Variation of references to time, money etc.

    25. 73. Interpretation.

    26. 74. Meaning of “associate”.

    27. 75. Amendments, repeals and transitional provisions.

    28. 76. Receipts and expenses.

    29. 77. Crown application.

    30. 78. Short title, commencement and extent.

  23. SCHEDULES

    1. SCHEDULE A1

      DEBTOR TO WHOM SECTION 5(2ZA) APPLIES: APPLICATION OF ACT

      1. 1.Modification of certain provisions of Act

      2. 2.Accountant in Bankruptcy’s duty to consider whether paragraph 1 should cease to apply

      3. 3.Procedure where Accountant in Bankruptcy considers paragraph 1 should cease to apply

      4. 4.Debtor’s right of appeal against decision under paragraph 3

      5. 5.Decision that paragraph 1 ceases to have effect: modification of certain provisions of Act

    2. SCHEDULE 1

      Determination of Amount of Creditor’s Claim

      1. Amount which may be claimed generally

        1. 1.(1) Subject to the provisions of this Schedule, the amount...

      2. Claims for aliment and periodical allowance on divorce

        1. 2.(1) A person entitled to aliment, however arising, from a...

      3. Debts depending on contingency

        1. 3.(1) Subject to sub-paragraph (2) below, the amount which a...

      4. ...

        1. 4. Determination of Amount of Creditor’s Claim

      5. Secured debts

        1. 5.(1) In calculating the amount of his claim, a secured...

      6. Valuation of claims against partners for debts of the partnership

        1. 6.Where a creditor claims in respect of a debt of...

    3. SCHEDULE 2

      1. 1.Except where the permanent trustee is the Accountant in Bankruptcy,section...

      2. 2.(1) In place of section 25, sub-paragraph (2) below shall...

      3. 3.(1) In place of subsections (1A) to (5) of section...

      4. 4.(1) Section 29 shall have effect as follows.

      5. 5.Where an appointment is made under paragraph 3(3), or by...

      6. 6.Section 30 shall not have effect, and, in any sequestration...

      7. 7.In section 39 , subsection (1) shall not have effect...

      8. 8.Except where the permanent trustee is the Accountant in Bankruptcy,any...

      9. 9.(1) Where the permanent trustee is the Accountant in Bankruptcy,...

    4. Schedule 2A

      Modification of duties of permanent trustee in summary administration

      1. 1.The permanent trustee shall comply with the requirements of sections...

      2. 2.The permanent trustee shall, until the debtor is discharged under...

      3. 3.(1) Where the Accountant in Bankruptcy is not the permanent...

      4. 4.(1) The permanent trustee shall, as soon as a certificate...

      5. 5.Except in the case of an application for the grant...

    5. SCHEDULE 3

      PREFERRED DEBTS

      1. Part I List of Preferred Debts

        1. Debts to Inland Revenue

          1. 1.. . . . . . . . . ....

        2. Debts due to Customs and Excise

          1. 2.. . . . . . . . . ....

        3. Social Security contributions

          1. 3.. . . . . . . . . ....

        4. Contributions to occupational pension schemes, et ceteralaetc.

          1. 4.Any sum which is owed by the debtor and is...

        5. Remuneration of employees, et ceteralaetc.

          1. 5.(1) So much of any amount which—

          2. 6.So much of any amount which— (a) is ordered, whether...

        6. Levies on coal and steel production

          1. 6A.Any sums due at the relevant date from the debtor...

        7. Debts owed to the Financial Services Compensation Scheme

          1. 6AA.Any debt owed by the debtor to the scheme manager...

        8. Deposits covered by Financial Services Compensation Scheme

          1. 6B.So much of any amount owed at the relevant date...

        9. Other deposits

          1. 6C.So much of any amount owed at the relevant date...

          2. 6D.An amount owed at the relevant date by the debtor...

      2. Part II Interpretation of Part I

        1. Meaning of “the relevant date”

          1. 7.In Part I of this Schedule “the relevant date” means—...

        2. Periods to which value added tax referable

          1. 8. PREFERRED DEBTS

        3. Periods to which insurance premium tax referable

          1. 8A. PREFERRED DEBTS

        4. Periods to which landfill tax referable

          1. 8B. PREFERRED DEBTS

        5. Periods to which climate change levy referable

          1. 8C. PREFERRED DEBTS

          2. 8D.Periods to which aggregates levy referable

        6. Amounts payable by way of remuneration

          1. 9.(1) For the purposes of paragraph 5 of Part I...

        7. Meaning of scheme manager

          1. 9ZA.In paragraph 6AA “the scheme manager” has the meaning given...

        8. Meaning of eligible deposit

          1. 9A.(1) In paragraphs 6B to 6D “ eligible deposit ”...

        9. Transitional Provisions

          1. 10.Regulations under paragraph 5 or 6 of Part I of...

    6. SCHEDULE 3A

      INFORMATION TO BE INCLUDED IN THE SEDERUNT BOOK

      1. 1.A copy of a debtor application made under section 5(2)(a)....

      2. 2.A copy of a petition presented under section 5(2)(b).

      3. 3.Where the trustee is the Accountant in Bankruptcy, a copy...

      4. 4.A copy of an award of sequestration granted under section...

      5. 5.A copy of a warrant to cite the debtor granted...

      6. 6.Where the trustee is not the Accountant in Bankruptcy—

      7. 7.Where the trustee is the Accountant in Bankruptcy—

      8. 8.Where the Accountant in Bankruptcy is appointed as interim trustee...

      9. 9.A copy of any— (a) order recalling or refusing to...

      10. 10.A copy of any order under section 41(1)(b)(ii) or 41A(1)(b)(ii)...

      11. 11.Where the trustee is a replacement trustee appointed under section...

      12. 12.Where the trustee is not the Accountant in Bankruptcy, a...

      13. 13.A copy of a notice given under section 21A(2).

      14. 14.Where the trustee is not the Accountant in Bankruptcy, a...

      15. 15.Where the trustee is a replacement trustee appointed under section...

      16. 16.A copy of any initial proposal for the debtor’s contribution...

      17. 17.A copy of a debtor contribution order applying to the...

      18. 18.A copy of any decree issued under section 34 affecting...

      19. 19.A copy of any decree of recall issued following an...

      20. 20.A copy of any decree issued under section 36 affecting...

      21. 21.The inventory and valuation of the estate made up and...

      22. 22.A copy of an account given by the debtor under...

      23. 23.The debtor’s deposition at an examination subscribed under section 47(5)....

      24. 24.A copy of the record of an examination sent to...

      25. 25.An appropriate entry in relation to the production of any...

      26. 26.Where the trustee accepts or rejects a claim under section...

      27. 27.A copy of a decision of the Accountant in Bankruptcy...

      28. 28.An agreement or determination in respect of the accounting period...

      29. 29.Where the trustee is not the Accountant in Bankruptcy, the...

      30. 30.A copy the certificate of discharge given to the debtor...

      31. 31.A copy the certificate deferring discharge where the debtor cannot...

      32. 32.Where the Accountant in Bankruptcy has acted as trustee, after...

      33. 33.Where the Accountant in Bankruptcy has acted as trustee and...

      34. 34.A decision of the court under section 63 and of...

      35. 35.A copy of a decree arbitral or, as the case...

      36. 36.The minutes of the meeting mentioned in paragraph 7 of...

      37. 37.A copy of the minutes of any meeting sent to...

      38. 38.Where a meeting of commissioners is called in accordance with...

      39. 39.A copy of any decision (including any determination, direction, award,...

      40. 40.A copy of any decree, interlocutory decree, direction or order...

    7. SCHEDULE 4

      Discharge on Composition

      1. 1. Discharge on Composition

      2. 2. Discharge on Composition

      3. 3. Discharge on Composition

      4. 4. Discharge on Composition

      5. 5. Discharge on Composition

      6. 6. Discharge on Composition

      7. 7. Discharge on Composition

      8. 8. Discharge on Composition

      9. 8A. Discharge on Composition

      10. 9. Discharge on Composition

      11. 10. Discharge on Composition

      12. 11. Discharge on Composition

      13. 12. Discharge on Composition

      14. 13. Discharge on Composition

      15. 14. Discharge on Composition

      16. 15. Discharge on Composition

      17. 16. Discharge on Composition

      18. 17. Discharge on Composition

      19. 18. Discharge on Composition

    8. SCHEDULE 5

      Voluntary Trust Deeds for Creditors

      1. Remuneration of trustee

        1. 1.Whether or not provision is made in the trust deed...

      2. Accountant in Bankruptcy's power to carry out audit

        1. 1A.The Accountant in Bankruptcy may, at any time, audit the...

      3. Registration of notice of inhibition

        1. 2.(1) The trustee, from time to time after the trust...

      4. Lodging of claim to bar effect of limitation of actions

        1. 3.The submission of a claim by a creditor to the...

      5. Valuation of claims

        1. 4.Unless the trust deed otherwise provides, Schedule 1 to this...

      6. Protected trust deeds

        1. 5.(1) The Scottish Ministers may by regulations make provision as...

        2. 6.Where the provisions of paragraph 5 of this Schedule have...

        3. 7.(1) A qualified creditor who has not been sent a...

        4. 8.In this Act a trust deed in respect of which...

        5. 9.Where the trustee under a protected trust deed has made...

        6. 10.Where the trustee under a protected trust deed has obtained...

      7. Creditors not acceding to protected trust deed

        1. 11.A creditor who has not been sent a copy of...

        2. 12.Where, on an application by a creditor under paragraph 11...

        3. 13.Where the court makes an order under paragraph 12 above,...

    9. SCHEDULE 6

      MEETINGS OF CREDITORS AND COMMISSIONERS

      1. Part I Meetings of creditors other than the statutory meeting

        1. Calling of meeting

          1. 1.The . . . trustee shall call a meeting of...

          2. 2.A meeting called under paragraph 1 above shall be held...

          3. 3.The . . . trustee or a commissioner who has...

          4. 4.The . . . trustee or a commissioner calling a...

          5. 5.(1) Where a requirement has been made under paragraph 1...

          6. 6.It shall not be necessary to notify under paragraph 4...

        2. Role of . . . trustee at meeting

          1. 7.(1) At the commencement of a meeting, the chairman shall...

        3. Appeals

          1. 8.The . . . trustee, a creditor or any other...

      2. Part II All Meetings of Creditors

        1. Validity of proceedings

          1. 9.No proceedings at a meeting shall be invalidated by reason...

        2. Locus of meeting

          1. 10.Every meeting shall be held in such place (whether or...

        3. Mandatories

          1. 11.(1) A creditor may authorise in writing any person to...

        4. Quorum

          1. 12.The quorum at any meeting shall be one creditor.

        5. Voting at meeting

          1. 13.Any question at a meeting shall be determined by a...

        6. Objections by creditors

          1. 14.(1) The chairman at any meeting may allow or disallow...

        7. Adjournment of meeting

          1. 15.(1) If no creditor has appeared at a meeting at...

        8. Minutes of meeting

          1. 16.The minutes of every meeting shall be signed by the...

      3. Part III Meetings of Commissioners

        1. 17.The . . . trustee may call a meeting of...

        2. 18.If the . . . trustee fails to call a...

        3. 19.The . . . trustee shall give the commissioners at...

        4. 20.The . . . trustee shall act as clerk at...

        5. 21.If the commissioners are considering the performance of the functions...

        6. 22.The quorum at a meeting of commissioners shall be one...

        7. 23.Any matter may be agreed by the commissioners without a...

    10. SCHEDULE 7

      1. Part I Consequential Amendments

        1. The Judicial Factors (Scotland) Act 1880 (c.4)

          1. 1.In section 3 (interpretation), for the words “section 14 or...

        2. 2.. . . . . . . . . ....

        3. The Judicial Factors (Scotland) Act 1889 (c.39)

          1. 3.In section 2, at the beginning there shall be inserted...

          2. 4.After section 11 there shall be inserted the following sections—...

        4. The Conveyancing (Scotland) Act 1924 (c. 27)

          1. 5.In section 44(4)(c) (limitation of effect of entries in the...

        5. ...

          1. 6.(1) In section 1(2) (rights of third parties against insurers...

        6. 7.. . . . . . . . . ....

        7. The Conveyancing and Feudal Reform (Scotland) Act 1970 (c.35)

          1. 8.In paragraph 9(2)(b) of Schedule 3 (“insolvent” for purposes of...

        8. The Superannuation Act 1972 (c.11)

          1. 9.In section 5(2) (benefits under civil service superannuation schemes not...

        9. 10.. . . . . . . . . ....

        10. The Prescription and Limitation (Scotland) Act 1973 (c.52)

          1. 11.In section 9(1), for paragraph (b) there shall be substituted...

        11. The Local Government (Scotland) Act 1973 (c.65)

          1. 12.In section 31(2) (disqualifications regarding members of local authority), for...

        12. The Social Security Pensions Act 1975 (c.60)

          1. 13.. . . . . . . . . ....

        13. The Employment Protection (Consolidation) Act 1978 (c.44)

          1. 14.(1) . . . . . . . . ....

        14. The Land Registration (Scotland) Act 1979 (c.33)

          1. 15.. . . . . . . . . ....

        15. The Banking Act 1979 (c.37)

          1. 16.In section 28 (payments to depositors on institution’s insolvency)—

        16. The Estate Agents Act 1979 (c.38)

          1. 17.In section 23(2) (bankrupts not to engage in estate agency...

        17. The Value Added Tax Act 1983 (c.55)

          1. 18.In section 22(4)(a)(ii) (“insolvency” for purposes of refund of tax...

        18. 19—22.. . . . . . . . . ....

        19. The Family Law (Scotland) Act 1985 (c.37)

          1. 23.In section 14(5)(b) for the words from “sections 30” to...

      2. Part II Re-enactment of Certain Provisions of Bankruptcy (Scotland) Act 1913 (c. 20)

        1. Arrestments and Poindings

          1. 24.(1) Subject to sub-paragraph (2) below, all arrestments and attachments...

        2. Exemptions from stamp or other duties for conveyances, deeds et ceteralaetc. relating to sequestrated estates

          1. 25.Any— (a) conveyance, assignation, instrument, discharge, writing, or deed relating...

    11. SCHEDULE 8

      Repeals

      1. . . . . . . . . . ....

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