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Insolvency Law

Expert guidance on all aspects of corporate and personal insolvency

01 MAY 2012

Official Receiver v Negus [2011] EWHC 3719 (Ch); [2012] BPIR 382

(Chancery Division, Newey J, 16 December 2011)

The Official Receiver sought an income payments order against the bankrupt for £40 pcm, being half of the difference between his income and expenses. An order was refused, because the entirety of the sums generated would go to discharge bankruptcy expenses, and the creditors would receive nothing. Newey J allowed the Official Receiver's appeal. The fact that the sums would discharge expenses only was not a ground to refuse to make the order, as (1) the foundation of the order under s 310 of the Insolvency Act 1986 made no reference to a benefit to creditors; (2) it was as important to discharge the expenses as well as debts, since the expenses had priority; and (3) public policy was that a bankrupt should not be discharged from his debts without some obligations.

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