SCHEDULES
C2F11SCHEDULE 15A Application of other companies insolvency legislation to building societies
Sch. 15A applied (with modifications) (7.4.2010) by The Building Societies (Financial Assistance) Order 2010 (S.I. 2010/1188), arts. 1(2), 11 (as amended (1.4.2013) by The Financial Services Act 2012 (Mutual Societies) Order 2013 (S.I. 2013/496), arts. 1(1), 2(c), Sch. 11 para. 18(5)(d) (with Sch. 12) and (with application in accordance with art. 1(4) of the amending S.I.) by The Building Societies (Floating Charges and Other Provisions) Order 2016 (S.I. 2016/679), art. 1(1)(2), 5(3))
Part II Modified Application of F23Parts I to III of Insolvency Act 1986
Words in Sch. 15A Pt. II heading substituted (with application in accordance with art. 1(4) of the amending S.I.) by The Building Societies (Floating Charges and Other Provisions) Order 2016 (S.I. 2016/679), arts. 1(1), 4(3)(a)
Preliminary
6
In this Part of this Schedule, the M1Insolvency Act 1986 is referred to as “the Act”.
Voluntary arrangements
7
Section 1 of the Act (proposals for voluntary arrangements) has effect as if—
a
it required any proposal under Part I of the Act to be so framed as to enable a building society to comply with the requirements of this Act; and
b
any reference to debts included a reference to liabilities owed to the holders of shares in a building society.
8
In section 2 (procedure where nominee is not liquidator or administrator) and section 3 (summoning of meetings) of the Act as applied to a building society, any reference to a meeting of the society is a reference to—
a
a meeting of both shareholding and borrowing members of the society; and
b
a meeting of shareholding members alone.
F1and subsection (1) of section 2 shall have effect with the omission of the words from “and the directors” to the end.
F28A
In subsection (2) of section 4A of the Act (approval of arrangement) as applied to a building society, paragraph (b) and the word “or” immediately preceding that paragraph are omitted.
9
In section 6 of the Act (challenge of decisions) as applied to a building society, “contributory”—
a
means every person liable to contribute to the assets of the society in the event of its being wound up, and
b
for the purposes of all proceedings for determining, and all proceedings prior to the determination of, the persons who are to be deemed contributories, includes any person alleged to be a contributory, and
c
includes persons who are liable to pay or contribute to the payment of—
i
any debt or liability of the building society being wound up, or
ii
any sum for the adjustment of rights of members among themselves, or
iii
the expenses of the winding up;
but does not include persons liable to contribute by virtue of a declaration by the court under section 213 (imputed responsibility for fraudulent trading) or section 214 (wrongful trading) of the Act.
F39A
In section 7A of the Act (prosecution of delinquent officers) as applied to a building society—
a
in subsection (2), for paragraphs (i) and (ii) there is substituted “
the F14FCA
”
,
b
subsections (3) to (7) are omitted,
c
in subsection (8), for
“Secretary of State” there is substituted “
F14FCA
”
.
Administration orders
10
1
Section 8 of the Act (power of court to make administration order) has effect as if it included provision that, where—
a
an application for an administration order to be made in relation to a building society is made by the F15FCA or the PRA (with or without other parties); and
b
the society has defaulted in an obligation to pay any sum due and payable in respect of any deposit or share,
the society shall be deemed for the purposes of subsection (1) to be unable to pay its debts.
2
In subsection (3) of that section, paragraph (c) and, in subsection (4) of that section, the words from “nor where” to the end are omitted.
11
1
Subsection (1) of section 9 of the Act (application for administration order) as applied to a building society has effect as if—
a
it enabled an application to the court for an administration order to be by petition presented, with or without other parties, by the F16FCA or the PRA or by a shareholding member entitled under section 89(3) of this Act to petition for the winding up of the society; and
b
the words from “or by the clerk” to “on companies)” were omitted.
2
In subsection (2)(a) of that section as so applied, the reference to any person who has appointed, or is or may be entitled to appoint, an administrative receiver of the society is a reference to the Commission (unless it is a petitioner).
3
Subsection (3) of that section, and in subsection (4) of that section, the words “Subject to subsection (3),” are omitted.
12
In section 10 of the Act (effect of application for administration order), the following are omitted, namely—
a
in subsection (2), paragraphs (b) and (c); and
b
subsection (3).
13
In section 11 of the Act (effect of administration order), the following are omitted, namely—
a
in subsection (1), paragraph (b) and the word “and” immediately preceding that paragraph;
b
in subsection (3), paragraph (b);
c
in subsection (4), the words “an administrative receiver of the company has vacated office under subsection (1)(b), or”; and
d
subsection (5).
14
In subsection (1) of section 12 of the Act (notification of administration order), the reference to every invoice, order for goods or business letter is a reference to every statement of account, order for goods or services, business letter or advertisement.
15
Subsection (3) of section 13 of the Act (appointment of administrator) has effect as if it enabled an application for an order under subsection (2) of that section to be made by the F17FCA or the PRA .
16
1
Subject to sub-paragraph (2) below, section 14 of the Act (general powers of administrator) has effect as if it required the administrator of a building society, in exercising his powers under that section—
a
to ensure compliance with the provisions of this Act; and
b
not to appoint to be a director any person who is not a fit and proper person to hold that position.
2
Sub-paragraph (1)(a) above does not apply in relation to section 5, 6 or 7 of this Act F4. . ..
3
F54
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17
1
Subject to sub-paragraph (3) below, paragraph 16 of Schedule 1 to the Act (powers of administrators) as applied to a building society has effect as if it conferred power to transfer liabilities in respect of deposits with or shares in the society.
2
No transfer under that paragraph shall be a transfer of engagements for the purposes of Part X of this Act.
3
No transfer under that paragraph which, apart from sub-paragraph (2) above, would be a transfer of engagements for the purposes of that Part shall be made unless it is approved by the court, or by meetings summoned under section 23(1) or 25(2) of the Act (as modified by paragraph 21 or 23 below).
F2118
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
19
1
Section 17 of the Act (general duties of administrator) has effect as if, instead of the requirement imposed by subsection (3), it required the administrator of a building society to summon a meeting of the society’s creditors if—
a
he is requested, in accordance with the rules, to do so by 500 of the society’s creditors, or by one-tenth, in number or value, of those creditors, or
b
he is directed to do so by the court.
2
That section also has effect as if it required the administrator of a building society to summon a meeting of the society’s shareholding members if—
a
he is requested, in accordance with the rules, to do so by 500 of the society’s shareholding members, or by one-tenth, in number, of those members, or
b
he is directed to do so by the court.
F2220
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21
1
Subsection (1) of section 23 of the Act (statement of proposals) as applied to a building society has effect as if—
b
the reference to all creditors included a reference to all holders of shares in the society; and
c
the reference to a meeting of the society’s creditors included a reference to a meeting of holders of shares in the society.
2
In subsection (2) of that section as so applied, references to members of the society do not include references to holders of shares in the society.
22
Section 24 of the Act (consideration of proposals by creditors’ meeting) as applied to a building society has effect as if any reference to a meeting of creditors included a reference to a meeting of holders of shares in the society.
23
1
Section 25 of the Act (approval of substantial revisions) as applied to a building society has effect as if—
a
b
the reference in that subsection to a meeting of creditors included a reference to a meeting of holders of shares in the society.
2
In subsection (3) of that section as so applied, references to members of the society do not include references to holders of shares in the society.
24
Subsection (1) of section 27 of the Act (protection of interests of creditors and members) has effect—
a
Receivers and managers
C125
In section 38 of the Act (receivership accounts), “prescribed” means prescribed by regulations made by statutory instrument by the F10Treasury.
26
In subsection (1) of section 39 of the Act (notification that receiver or manager appointed), the reference to every invoice, order for goods or business letter is a reference to every statement of account, order for goods or services, business letter or advertisement.
F2427
Subsection (3) of section 40 of the Act (payment of debts out of assets subject to floating charge), as applied to a building society, has effect as if the reference to general creditors included a reference to shareholding members of the society in respect of deposits which are not relevant deposits.
27A
Sections 42 to 49 of the Act (administrative receivers) are omitted.
27B
Subsection (1) of section 51 of the Act (power to appoint receiver), as applied to a building society, has effect as if for the words “an incorporated company (whether a company registered under the Companies Act 2006 or not)” there were substituted “a building society”.
27C
Subsection (3) of section 59 of the Act (priority of debts), as applied to a building society, has effect as if the reference to ordinary creditors included a reference to shareholding members of the society in respect of deposits which are not relevant deposits.
27D
Subsection (1) of section 67 of the Act (report by receiver), as applied to a building society, has effect as if—
a
the reference to the Financial Conduct Authority included a reference to the scheme manager; and
b
in paragraph (d) the reference to other creditors included a reference to shareholding members of the society in respect of deposits which are not relevant deposits.
27E
Subsection (1) of section 70 of the Act (interpretation for Chapter 2), as applied to a building society, has effect as if—
a
in the definition of “company” for the words “an incorporated company (whether or not a company registered under the Companies Act 2006)” there were substituted “a building society”; and
b
the definition of “the register” were omitted.
27F
Chapter 4 of Part 3 of the Act (prohibition of appointment of administrative receiver), as applied to a building society, has effect as if—
a
in section 72A (floating charge holder not to appoint administrative receiver)—
i
in subsections (1) and (2) the word “qualifying” and in subsection (3) the definition of “holder of a qualifying floating charge in respect of a company’s property” were omitted; and
ii
subsections (4)(a), (5) and (6) were omitted; and
b
sections 72B to 72H (exceptions to prohibition) were omitted.
Sch. 15A inserted (1.12.1997) by 1997 c. 32, s. 39(2), Sch. 6; S.I. 1997/2668, art. 2, Sch. Pt. I(i)