Insolvency Act 2000

Insolvency Act 2000

2000 CHAPTER 39

Commentary on Sections

Section 12: Insolvent estates of deceased persons

35. This section inserts a new Section 421A into the Insolvency Act 1986 by addressing the effects of the Court of Appeal decision in the case of In re Palmer Deceased (A Debtor) 1994 Ch. 316.  In March 1994 the Court of Appeal attributed the ordinary, rather than the technical, meaning to “the estate of a deceased person” used in the context of an order–making power in Section 421.  The consequence of that is that the debtor’s interest, on the day of his death, in his share in property held on a joint tenancy (usually the matrimonial home) does not become available to the trustee¹ to distribute among the creditors of a deceased insolvent.  This section allows the trustee of a deceased insolvent, if certain conditions are met, to apply to the court to recover the value of the deceased insolvent’s former interest in a jointly-owned property from the survivor for the benefit of the estate.  The purpose of an order under section 421A is to cover debts and other liabilities of the insolvent estate. Section 421A applies only in England and Wales.

1

The trustee is the person appointed to realise the assets of a deceased individual and distribute the proceeds to the creditors.