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Insolvency Law

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Guildhall Chambers , 03 MAR 2015

Re Salliss [2014] EWHC 229 (Ch); [2014] BPIR 755

Re Salliss [2014] EWHC 229 (Ch); [2014] BPIR 755
(Chancery Division, Sir Terrence Etherton, 10 February 2014)


A Deputy Registrar was wrong to dismiss a discharged bankrupt’s application for annulment of his bankruptcy on the basis that his main creditor bank remained unpaid, as the bank had told the trustee in bankruptcy clearly and unequivocally that it did not intend to prove for its debt.

The Appellant (‘S’) appealed against the decision of a Registrar not to annul his bankruptcy. He also appealed against the Registrar’s decision to allow applications made by S’s trustee in bankruptcy (‘the Trustee’) ruling that the Trustee was to be remunerated on the basis of time properly spent.

S had five unsecured creditors. Four creditors proved in the bankruptcy and upon S’s discharge remained unpaid. However, post discharge the four creditors were paid in full by S. The fifth creditor (‘B’) was aware that S intended to apply for an annulment. However, it had told S clearly and unequivocally that it did not intend to prove for its debt. In those circumstances the debt owed to B was not a relevant consideration when deciding S’s application for an annulment. Accordingly, the annulment was granted.

With regard to the remuneration application, the Registrar’s approach was found to be flawed. The principles to be applied were as stated in Brook v Reed [2011] EWCA Civ 331, [2012] 1 W.L.R. 419 and as contained in Part Five of the Practice Direction (Ch D: Insolvency Proceedings) [2012] Bus. L.R. 643. Neither authority had been mentioned by the Registrar and the principles contained in those authorities had not been given proper weight.

In those circumstances the Registrar’s decision on the annulment application and the remuneration application would be set aside and remitted to a different Registrar.
Guildhall Chambers
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