Section 131: Creditors not required to prove small debts: company insolvency
752.To receive a dividend in an insolvency, a creditor must first submit a claim to the officeholder, which must contain certain statutory information. The office-holder may ask for further evidence from the creditor if thought necessary. Such claims must be scrutinised by the office-holder prior to distribution.
753.This section creates a power to make rules which will allow an officeholder in a corporate insolvency to pay a dividend to a creditor without the need for the creditor to submit a claim where the debt owed to a creditor in respect of which the dividend relates, is below a prescribed amount (the intention is to set this initially at £1,000). The officeholder may do so on the basis the creditor’s debt has been recorded based on the insolvent’s statement of affairs submitted to the officeholder or their accounting records.
754.Where a creditor disputes the amount shown in the insolvent’s statement of affairs or accounting records, they will still be able to submit a claim and provide documentary evidence in support of it. Where the officeholder is unclear on the amount owed, or has other doubts regarding the claim, they may still require a claim form and/or ask for documentary evidence from the creditor.