PART 14

Voluntary trust deeds for creditors

Effect of protected status etc.

Effect of protected status: general
172
1
Where a trust deed has protected status then—
a
subject to section 177, a creditor who (either or both)—
i
is not a notified creditor, or
ii
notified the trustee, during the relevant period, of objection to the trust deed,
has no higher right to recover the debt than a creditor who has acceded to, or been deemed by virtue of section 170(2) to have acceded to, the trust deed, and
b
an application for sequestration of the debtor’s estate may not be made by the debtor while the trust deed subsists.
2
A creditor ceases to be deemed (by virtue of section 170(2)) to have acceded to a trust deed if the trustee refuses a request by the debtor to apply to AiB for discharge in terms of section 184(8).
3
Where a secured creditor’s agreement has been obtained by virtue of section 166(2)(b) and the trust deed becomes a protected trust deed, that creditor is not entitled—
a
to make a claim under the protected trust deed for any of the debt in respect of which the security is held,
b
to do diligence against the assets conveyed to the trustee under the protected trust deed, or
c
to petition for the sequestration of the debtor during the subsistence of the protected trust deed.