News

The end of Conditional Fee Arrangements

On 17 December 2015, the Government announced that the temporary exemption for insolvency proceedings that allowed Insolvency Practitioners to recover conditional fee agreements (“CFA”) success fees and after the event (“ATE”) insurance premiums from losing opponents will come to an end with effect from April 2016. The potential for this to happen first occurred in April 2013 where the Government, in the interest of tackling the high costs of civil litigation in England and Wales, introduced The Legal Aid, Sentencing and Punishment of Offenders (LASPO) Act 2012 (“the Act”). Section 44 of the Act provided general reforms to the operation of no win no fee conditional fee agreements, whilst Section […]

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PPI claims in completed IVAs

A recent High Court decision in relation to PPI refunds, and therefore other unarranged unrealised assets, received by a debtor after the completion of an Individual Voluntary Arrangement (“IVA”) has highlighted the importance in Insolvency Practitioners, or any agents instructed on their behalf, taking the necessary steps to ensure that such assets are recovered for the benefit of the debtor’s creditors. In the case James Green v James Wright [2015] EWHC 993 (Ch), the court was asked to consider the following the facts: A debtor, who had completed their IVA and a certificate of completion had been issued, discovered that they were owed funds as a result of miss-sold Payment […]

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Bankruptcy threshold increased

The government has recently announced plans to increase the Bankruptcy threshold, which is the minimal debt level required for a creditor to present a bankruptcy petition against a debtor, to £5,000 on 1 October 2015. The current threshold of £750 has been in place since the Insolvency Act 1986 was introduced some 30 years and this rise represents an increase of 675 percent. The rationale behind this increase is to reserve bankruptcy proceedings for cases with sizable debts and promote the use alternative solutions for smaller debts.

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DRO Requirements Changed

In series of proposed changes aimed to assist individuals in dealing with debt, the government has recently announced plans to alter the limits in which an individual may apply for the Debt Relief Order (“DRO”). DROs were introduced as a new form of insolvency in 2007 and came into force in 2009. Essentially, DROs act as a quicker and cheaper alternative to bankruptcy for those with a small value of debts and assets. It is an administrative, rather than court based, procedure and was designed to have those with small debts address their financial issues earlier on instead of bury their heads in the sand. A £90 fee is payable […]

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Insolvency and Pensions changes

Insolvency law continues to change and evolve in an attempt to fairly balance the interest of debtor and their creditors, more specifically to provide a debtor will the tools to address and improve their financial situation whilst provide creditors will a fair and for the most equal repayment of the monies owed to them. One such change can be seen in the High Court decision in Horton v Henry [2014] EWHC 4209 (Ch) in which the decision fell upon the correct interpretation of Section 310(7) of the Insolvency Act 1986. In order to understand the reason for the decision fully, it is necessary to consider the statutory and previous case […]

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