Bankruptcy (Scotland) Act 2016

1. Introductory Text

2. PART 1 Application or petition for sequestration

   1. Applications and petitions

      1. 1. Sequestration

      2. 2. Sequestration of estate of living debtor

      3. 3. Debt advice and information package

      4. 4. Money advice

      5. 5. Sequestration of estate of deceased debtor

      6. 6. Sequestration of other estates

      7. 7. Qualified creditor and qualified creditors

      8. 8. Debtor applications: general

      9. 9. Certificate for sequestration

      10. 10. Death or withdrawal

      11. 11. Debtor application: provision of information

      12. 12. Petition for sequestration of estate: provision of information

      13. 13. Further provisions relating to presentation of petitions

      14. 14. Further provisions relating to debtor applications

   2. Jurisdiction

      1. 15. Jurisdiction

   3. Meaning of “apparent insolvency”

      1. 16. Meaning of “apparent insolvency”

   4. Concurrent proceedings

      1. 17. Concurrent proceedings for sequestration or analogous remedy

      2. 18. Powers in relation to concurrent proceedings

   5. Creditor’s oath

      1. 19. Creditor’s oath

3. PART 2 Sequestration: award and recall

   1. Incomplete or inappropriate debtor applications

      1. 20. Debtor application: incomplete application

      2. 21. Refusal of debtor application: inappropriate application

   2. Award of sequestration

      1. 22. When sequestration is awarded

      2. 23. Circumstances in which sequestration is not to be awarded in pursuance of section 22(5)

      3. 24. Effect of sequestration on diligence generally

      4. 25. Effect of sequestration on diligence: estate of deceased debtor

      5. 26. Registration of warrant or determination of debtor application

      6. 27. Further matters in relation to award of sequestration

      7. 28. Benefit from another estate

   3. Recall of sequestration

      1. 29. Petitions for recall of sequestration

      2. 30. Recall of sequestration by sheriff

      3. 31. Application to Accountant in Bankruptcy for recall of sequestration

      4. 32. Application under section 31: further procedure

      5. 33. Determination where amount of outlays and remuneration not agreed

      6. 34. Recall of sequestration by Accountant in Bankruptcy

      7. 35. Recall where Accountant in Bankruptcy trustee

      8. 36. Application for recall: remit to sheriff

      9. 37. Recall of sequestration by Accountant in Bankruptcy: review and appeal

      10. 38. Effect of recall of sequestration

4. PART 3 Initial stages of sequestration, statutory meeting and trustee vote

   1. Initial stages

      1. 39. Interim preservation of estate

      2. 40. Offences in relation to interim preservation of estate

      3. 41. Statement of assets and liabilities etc.

      4. 42. Duties on receipt of list of assets and liabilities

   2. Statutory meeting

      1. 43. Statutory meeting

      2. 44. Calling of statutory meeting

      3. 45. Procedure where no statutory meeting called

      4. 46. Submission of claims for voting purposes

      5. 47. Offences in relation to submission of claims for voting purposes

      6. 48. Proceedings before trustee vote

   3. Trustee vote

      1. 49. Trustee vote

5. PART 4 Trustees and commissioners

   1. Trustees

      1. 50. Functions of trustee

      2. 51. Appointment of trustee

      3. 52. Application to Accountant in Bankruptcy by trustee for a direction

   2. Interim trustees

      1. 53. Functions of interim trustee

      2. 54. Appointment of interim trustee

      3. 55. Removal, resignation etc. of interim trustee

      4. 56. Termination of interim trustee’s functions where not appointed trustee

      5. 57. Appeal or review by virtue of section 56

      6. 58. Termination of Accountant in Bankruptcy’s functions as interim trustee where not appointed trustee

      7. 59. Review or appeal by virtue of section 58

   3. Replacement trustees

      1. 60. Appointment of replacement trustee

      2. 61. Procedure in application to Accountant in Bankruptcy under section 60

      3. 62. Procedure in application under section 60, or appeal under section 61, to sheriff

      4. 63. Termination of original trustee’s functions

      5. 64. Accountant in Bankruptcy’s intromissions in capacity of original trustee

      6. 65. Discharge of original trustee

      7. 66. Replacement of trustee acting in more than one sequestration

      8. 67. Further provision as regards replacement under section 66

      9. 68. Review of determination or appointment under section 66

   4. Resignation or death of trustee

      1. 69. Resignation or death of trustee

   5. Removal of trustee and appointment of new trustee

      1. 70. Removal of trustee other than where trustee is unable to act or should no longer continue to act: general

      2. 71. Removal of trustee other than where trustee is unable to act or should no longer continue to act: review, appeal and election of new trustee

      3. 72. Removal of trustee where trustee is unable to act or should no longer continue to act: general

      4. 73. Removal of trustee where trustee is unable to act or should no longer continue to act: review, appeal and election of new trustee

      5. 74. Election or appointment of new trustee by virtue of section 71(6) or 73(1)

      6. 75. Further provision as regards election or appointment of new trustee

   6. Commissioners

      1. 76. Commissioners

      2. 77. Election, resignation and removal of commissioners

6. PART 5 Vesting etc.

   1. Vesting

      1. 78. Vesting of estate at date of sequestration

      2. 79. Provision supplementary to section 78 and interpretation of Part 5

      3. 80. Property subject to restraint order

      4. 81. Property released from detention

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

      6. 83. Property in respect of which realisation order is made

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

      8. 85. Vesting of income received by debtor after sequestration

      9. 86. Further provision as regards vesting of estate

      10. 87. Dealings and circumstances of debtor after sequestration

   2. Limitation on vesting

      1. 88. Limitation on vesting

7. PART 6 Debtor’s contribution

   1. Common financial tool

      1. 89. Assessment of debtor’s contribution

   2. Payments by debtor following sequestration

      1. 90. Debtor contribution order: general

      2. 91. Debtor contribution order: payment period and intervals

      3. 92. Debtor contribution order: review and appeal

      4. 93. Effect of debtor contribution order

      5. 94. Deductions from debtor’s earnings and other income

      6. 95. Variation and removal of debtor contribution order by trustee

      7. 96. Payment break

      8. 97. Sections 95 and 96: review and appeal

8. PART 7 Safeguarding interests of creditors

   1. Gratuitous alienations and unfair preferences

      1. 98. Gratuitous alienations

      2. 99. Unfair preferences

   2. Recall of certain orders

      1. 100. Recall of order for payment of capital sum on divorce or on dissolution of civil partnership

   3. Excessive contributions

      1. 101. Recovery of excessive pension contributions

      2. 102. Orders under section 101

      3. 103. Orders under section 101: supplementary

      4. 104. Excessive contributions in pension-sharing cases: general

      5. 105. Excessive contributions in pension-sharing cases: recovery orders

      6. 106. Recovery orders: supplementary

      7. 107. References in Part 7 to “the 1889 Act” and to “the 1999 Act”

9. PART 8 Administration of estate by trustee

   1. General

      1. 108. Taking possession of estate by trustee

      2. 109. Management and realisation of estate

   2. Contractual powers and money received

      1. 110. Contractual powers of trustee

      2. 111. Money received by trustee

   3. Debtor’s home

      1. 112. Debtor’s family home

      2. 113. Power of trustee in relation to debtor’s family home

   4. Rights of spouse or civil partner

      1. 114. Protection of rights of spouse against arrangements intended to defeat them

      2. 115. Protection of rights of civil partner against arrangements intended to defeat them

   5. Account of state of affairs

      1. 116. Debtor’s account of state of affairs

   6. Financial education for debtor

      1. 117. Financial education for debtor

10. PART 9 Examination of debtor

    1. Private and public examination

       1. 118. Private examination

       2. 119. Public examination

       3. 120. Provisions ancillary to sections 118 and 119

    2. Conduct of examination

       1. 121. Conduct of examination

11. PART 10 Claims, dividends and distribution etc.

    1. Submission and adjudication of claims

       1. 122. Submission of claims to trustee

       2. 123. Evidence as to validity or amount of claim

       3. 124. False claims etc.

       4. 125. Further provision as to claims

       5. 126. Adjudication of claims: general

       6. 127. Adjudication of claims: review and appeal

    2. Entitlement to vote and draw a dividend

       1. 128. Voting and drawing a dividend

    3. Distribution

       1. 129. Priority in distribution

       2. 130. Accounting periods

       3. 131. Distribution in accordance with accounting periods

    4. Procedure after end of accounting period

       1. 132. Submission of accounts and scheme of division

       2. 133. Audit of accounts and determination as to outlays and remuneration payable to trustee

       3. 134. Appeal against determination as to outlays and remuneration payable to trustee

       4. 135. Further provision as to procedure after end of accounting period

       5. 136. Procedure after end of accounting period where Accountant in Bankruptcy is trustee

12. PART 11 Discharge

    1. Discharge of debtor

       1. 137. Discharge of debtor where Accountant in Bankruptcy not trustee

       2. 138. Discharge of debtor where Accountant in Bankruptcy trustee

       3. 139. Discharge of debtor: review and appeal

       4. 140. Discharge of debtor to whom section 2(2) applies

       5. 141. Deferral of discharge where debtor cannot be traced

       6. 142. Debtor not traced: new trustee

       7. 143. Debtor not traced: subsequent debtor contact

       8. 144. Subsequent debtor contact: review and appeal

       9. 145. Effect of discharge under section 137, 138 or 140

       10. 146. Discharge under section 140: conditions

       11. 147. Section 146: sanctions

    2. Discharge of trustee

       1. 148. Discharge of trustee

       2. 149. Further provision as regards discharge of trustee

       3. 150. Unclaimed dividends

       4. 151. Discharge of Accountant in Bankruptcy

13. PART 12 Assets discovered after discharge of trustee

    1. 152. Assets discovered after discharge of trustee: appointment of trustee

    2. 153. Assets discovered after discharge of trustee: notice

    3. 154. Assets discovered after discharge of trustee: appeal

14. PART 13 Bankruptcy restrictions orders and interim bankruptcy restrictions orders

    1. Bankruptcy restrictions orders

       1. 155. Bankruptcy restrictions order

       2. 156. Grounds for making bankruptcy restrictions order

       3. 157. Bankruptcy restrictions order: application of section 218(13)

       4. 158. Timing for making a bankruptcy restrictions order

       5. 159. Duration of bankruptcy restrictions order and application for revocation or variation

    2. Interim bankruptcy restrictions orders

       1. 160. Interim bankruptcy restrictions orders

    3. Effect of recall of sequestration

       1. 161. Bankruptcy restrictions orders and interim bankruptcy restrictions orders: effect of recall of sequestration

15. PART 14 Voluntary trust deeds for creditors

    1. General

       1. 162. Voluntary trust deeds for creditors

    2. Protected trust deeds: protected status

       1. 163. Protected status: general

    3. Conditions for protected status

       1. 164. Protected status: the debtor

       2. 165. Protected status: the trustee

       3. 166. Exclusion of a secured creditor from trust deed

       4. 167. Statements in and advice regarding trust deed

       5. 168. Payment of debtor’s contribution

       6. 169. Notice in register of insolvencies

       7. 170. Documents to be sent to creditors

    4. Registration for protected status

       1. 171. Registration for protected status

    5. Effect of protected status etc.

       1. 172. Effect of protected status: general

       2. 173. Effect of protected status on diligence against earnings

       3. 174. Deductions by virtue of protected trust deed from debtor’s earnings

       4. 175. Agreement in respect of debtor’s heritable property

       5. 176. Dividend payments

       6. 177. Sequestration petition by qualified creditor

       7. 178. Creditor’s application as respects intromissions of trustee

    6. Administration, accounting and discharge

       1. 179. Directions to trustee under protected trust deed

       2. 180. Information and notification obligations of trustee under protected trust deed

       3. 181. Administration of trust under protected trust deed

       4. 182. Retention of documents by trustee under protected trust deed

       5. 183. Remuneration payable to trustee under protected trust deed

       6. 184. Protected trust deed: discharge of debtor

       7. 185. Student loans

       8. 186. Protected trust deed: discharge of trustee

       9. 187. Electronic delivery of notices etc. under this Part

    7. Appeals and directions

       1. 188. Protected trust deed: appeal

       2. 189. Protected trust deed: sheriff’s direction

    8. Application for conversion to sequestration

       1. 190. Application for conversion to sequestration

       2. 191. Contents of affidavit required under section 190(2)

       3. 192. Powers of Accountant in Bankruptcy on application for conversion to sequestration

    9. Part 14: general

       1. 193. Interpretation of Part 14

       2. 194. Regulations modifying Part 14

16. PART 15 Moratorium on diligence

    1. 195. Moratorium on diligence: notice of intention to make debtor application under section 2(1)(a)

    2. 196. Moratorium on diligence: notice of intention to make debtor application under section 6

    3. 197. Moratorium on diligence following notice under section 195(1) or 196(1)

    4. 198. Period of moratorium

17. PART 16 Accountant in Bankruptcy

    1. Appointment

       1. 199. Accountant in Bankruptcy

    2. Functions

       1. 200. Supervisory functions of Accountant in Bankruptcy

       2. 201. Performance of certain functions of Accountant in Bankruptcy

       3. 202. Further duty of Accountant in Bankruptcy

    3. Directions to Accountant in Bankruptcy

       1. 203. Directions to Accountant in Bankruptcy

    4. Conduct of proceedings in the sheriff court

       1. 204. Conduct of proceedings in the sheriff court

    5. Fees for Accountant in Bankruptcy

       1. 205. Fees for Accountant in Bankruptcy

18. PART 17 Miscellaneous

    1. 206. Liabilities and rights of co-obligants

    2. 207. Member State liquidator deemed creditor

    3. 208. Trustee’s duty to provide certain notices and copies of documents to member State liquidator

    4. 209. Extortionate credit transactions

    5. 210. Sederunt book and other documents

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

    7. 212. Power of Accountant in Bankruptcy to cure defects in procedure

    8. 213. Decision under section 212(1): review

    9. 214. Review of decision by Accountant in Bankruptcy: grounds of appeal

    10. 215. Debtor to co-operate with trustee

    11. 216. Arbitration and compromise

    12. 217. Meetings of creditors and commissioners

    13. 218. General offences by debtor etc.

    14. 219. General offences: supplementary and penalties

    15. 220. Summary proceedings

    16. 221. Outlays of insolvency practitioner in actings as interim trustee or trustee

    17. 222. Supplies by utilities

    18. 223. Disqualification provisions: power to make regulations

    19. 224. Regulations: applications to Accountant in Bankruptcy etc.

19. PART 18 General

    1. 225. Regulations: general

    2. 226. Modification of regulation making powers

    3. 227. Variation of references to time, money etc.

    4. 228. Interpretation

    5. 229. Meaning of “associate”

    6. 230. “Associates”: regulations for the purposes of section 229

    7. 231. Proceedings under EC insolvency proceedings regulation: modified definition of “estate”

    8. 232. Crown application

    9. 233. Re-enactment

    10. 234. Modifications, repeals, savings, revocations and transitional provisions

    11. 235. Continuity of the law

    12. 236. Sequestrations to which this Act applies

    13. 237. Commencement

    14. 238. Short title

20. 1. SCHEDULE 1

       DEBTOR TO WHOM SECTION 2(2) 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 have effect

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

       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 2

       DETERMINATION OF AMOUNT OF CREDITOR’S CLAIM

       1. 1. Amount which may be claimed generally

       2. 2. Claims for aliment and for periodical allowance on divorce or on dissolution of civil partnership

       3. 3. Debts depending on contingency

       4. 4. Secured debts

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

    3. SCHEDULE 3

       PREFERRED DEBTS

       1. PART 1 List of preferred debts

          1. 1. Contributions to occupational pension schemes etc.

          2. 2. Remuneration of employees etc.

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

          4. 4. Levies on coal and steel production

          5. 5. Debts owed to the Financial Services Compensation Scheme

          6. 6. Deposits covered by Financial Services Compensation Scheme

          7. 7. Other deposits

          8. 8. An amount owed at the relevant date by the debtor...

       2. PART 2 Interpretation of Part 1

          1. 9. Meaning of “the relevant date”

          2. 10. Amounts payable by way of remuneration

          3. 11. Meaning of “prescribed”

          4. 12. Meaning of “scheme manager”

          5. 13. Meaning of “eligible deposit”

          6. 14. Transitional provisions

    4. SCHEDULE 4

       VOLUNTARY TRUST DEEDS FOR CREDITORS

       1. 1. Remuneration of trustee

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

       3. 3. Registration of notice of inhibition

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

       5. 5. Valuation of claims

    5. SCHEDULE 5

       INFORMATION TO BE INCLUDED IN THE SEDERUNT BOOK

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

       2. 2. A copy of the petition presented under section 2(1)(b).

       3. 3. Where the trustee is AiB, a copy of the statement...

       4. 4. A copy of the award of sequestration under section 22(1)...

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

       6. 6. Where the trustee is not AiB— (a) the audited accounts...

       7. 7. Where the trustee is AiB— (a) the accounts audited by...

       8. 8. Where AiB is appointed interim trustee and the sheriff awards...

       9. 9. A copy of— (a) an order— (i) recalling or refusing...

       10. 10. A copy of an order under section 114(3)(b) or 115(3)(b)...

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

       12. 12. Where the trustee is not AiB, a copy of a...

       13. 13. A copy of a notice given under section 44(3).

       14. 14. Where the trustee is not AiB, a copy of a...

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

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

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

       18. 18. A copy of a decree issued under section 98 affecting...

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

       20. 20. A copy of a decree under section 99 affecting the...

       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 121(6)....

       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 AiB under subsection (4)(b)...

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

       29. 29. Where the trustee is not AiB, the audited accounts, the...

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

       31. 31. A copy of the certificate deferring discharge where the debtor...

       32. 32. Where AiB has acted as trustee, after making the final...

       33. 33. Where AiB has acted as trustee and is discharged from...

       34. 34. A decision of the court under section 211 and of...

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

       36. 36. The minutes of the meeting referred to in paragraphs 8...

       37. 37. A copy of the minutes of a 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...

    6. SCHEDULE 6

       MEETINGS OF CREDITORS AND COMMISSIONERS

       1. PART 1 Meetings of creditors other than the statutory meeting

          1. 1. Calling of meeting

          2. 2. Any such meeting must be held not later than 28...

          3. 3. The trustee, or a commissioner who has given notice to...

          4. 4. The trustee, calling a meeting under paragraph 1 or 3,...

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

          6. 6. AiB, calling a meeting under paragraph 5, is no fewer...

          7. 7. It is not necessary to notify under paragraph 4 or...

          8. 8. Role of trustee at meeting

          9. 9. If no person is elected in pursuance of paragraph 8,...

          10. 10. The trustee is to arrange for a record to be...

          11. 11. Appeals

       2. PART 2 All meetings of creditors

          1. 12. Validity of proceedings

          2. 13. Locus of meeting

          3. 14. Mandatories

          4. 15. A creditor must lodge with the trustee, before the commencement...

          5. 16. Any reference in paragraph 8, or in the following provisions...

          6. 17. Quorum

          7. 18. Voting at meeting

          8. 19. Objections by creditors

          9. 20. A person aggrieved by the determination of the person chairing...

          10. 21. If the person chairing the meeting is in doubt as...

          11. 22. Adjournment of meeting

          12. 23. The person chairing the meeting may, with the consent of...

          13. 24. Any adjourned meeting must be held at the same time...

          14. 25. Minutes of meeting

       3. PART 3 Meetings of commissioners

          1. 26. The trustee— (a) may call a meeting of commissioners at...

          2. 27. If the trustee fails to call a meeting of commissioners...

          3. 28. The trustee must give the commissioners at least 7 days’...

          4. 29. The trustee is to act as clerk at a meeting...

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

          6. 31. The quorum at a meeting of commissioners is one commissioner...

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

    7. SCHEDULE 7

       RE-ENACTMENT OF SECTIONS 10 AND 189 OF THE BANKRUPTCY (SCOTLAND) ACT 1913

       1. 1. Arrestments and attachments

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

    8. SCHEDULE 8

       MODIFICATION OF ENACTMENTS

       1. 1. Judicial Factors (Scotland) Act 1889

       2. 2. Sheriff Courts (Scotland) Act 1907

       3. 3. Conveyancing (Scotland) Act 1924

       4. 4. Administration of Justice Act 1956

       5. 5. Conveyancing and Feudal Reform (Scotland) Act 1970

       6. 6. Prescription and Limitation (Scotland) Act 1973

       7. 7. Local Government (Scotland) Act 1973

       8. 8. Education (Scotland) Act 1980

       9. 9. Family Law (Scotland) Act 1985

       10. 10. Legal Aid (Scotland) Act 1986

       11. 11. Debtors (Scotland) Act 1987

       12. 12. Agricultural Holdings (Scotland) Act 1991

       13. 13. Crofters (Scotland) Act 1993

       14. 14. Proceeds of Crime (Scotland) Act 1995

       15. 15. Education (Scotland) Act 1996

       16. 16. Adults with Incapacity (Scotland) Act 2000

       17. 17. International Criminal Court (Scotland) Act 2001

       18. 18. Debt Arrangement and Attachment (Scotland) Act 2002

       19. 19. Agricultural Holdings (Scotland) Act 2003

       20. 20. Fire (Scotland) Act 2005

       21. 21. Further and Higher Education (Scotland) Act 2005

       22. 22. Charities and Trustee Investment (Scotland) Act 2005

       23. 23. Licensing (Scotland) Act 2005

       24. 24. Bankruptcy and Diligence etc. (Scotland) Act 2007

       25. 25. Criminal Proceedings etc. (Reform) (Scotland) Act 2007

       26. 26. Legal Services (Scotland) Act 2010

       27. 27. Housing (Scotland) Act 2010

       28. 28. Food (Scotland) Act 2015

    9. SCHEDULE 9

       REPEALS AND REVOCATIONS

       1. PART 1 Repeals

       2. PART 2 Revocations