Insolvency Act 1986, section 383

“Creditor”, “security”, etc

Part XI Interpretation for Second Group of Parts

(1) “Creditor”—

(a) in relation to a bankrupt, means a person to whom any of the bankruptcy debts is owed (being, in the case of an amount falling within paragraph (c) of the definition in section 382(1) or “bankruptcy debt”, the person in respect of whom that amount is specified in the criminal bankruptcy order in question), and

(b)in relation to an individual to whom a [F1005bankruptcy application orF1005] bankruptcy petition relates, means a person who would be a creditor in the bankruptcy if a bankruptcy order were made on that [F1006application orF1006] petition.

(2)Subject to the next two subsections and any provision of the rules requiring a creditor to give up his security for the purposes of proving a debt, a debt is secured for the purposes of this Group of Parts to the extent that the person to whom the debt is owed holds any security for the debt (whether a mortgage, charge, lien or other security) over any property of the person by whom the debt is owed.

(3)Where a statement such as is mentioned in section 269(1)(a) in Chapter I of Part IX has been made by a secured creditor for the purposes of any bankruptcy petition and a bankruptcy order is subsequently made on that petition, the creditor is deemed for the purposes of the Parts in this Group to have given up the security specified in the statement.

(4)In subsection (2) the reference to a security does not include a lien on books, papers or other records, except to the extent that they consist of documents which give a title to property and are held as such.

Cases considering section 383 24

Kapoor v National Westminster Bank Plc & Anor

[2011] EWCA Civ 1083 · 5 October 2011Defines

The statutory definition of creditor in bankruptcy supported the inference that the person to whom the debt is owed may vote. Applied with equitable-assignment principles, that person was the assignee in respect of the assigned debt (see paras [26]-[30]; [43]-[44]).

White v Davenham Trust Ltd

[2011] EWCA Civ 747 · 28 June 2011Defines

The court applies s.383 to define the relevant security as security over assets of the particular debtor whose bankruptcy is in issue. This supports treating security given by another debtor as irrelevant to the guarantor’s estate. (see paras [8]; [35])

Child Maintenance and Enforcement Commission v Beesley & Anor

[2010] EWCA Civ 1344 · 24 November 2010Defines

The provision defines a creditor for bankruptcy purposes by reference to a person to whom bankruptcy debts are owed. It supports the distinction between bankruptcy creditor status and IVA participation. (see paras [15]; [52]; [57])

4 more judgments, and what each says about section 383, are in the case-law panel in the full Act.

Amendments and notes

3 notes from legislation.gov.uk

Amendments

  1. F1005Words in s. 383(1)(b) inserted (6.4.2016) by Enterprise and Regulatory Reform Act 2013 (c. 24), s. 103(3), Sch. 19 para. 53(a); S.I. 2016/191, art. 2 (with art. 3)
  2. F1006Words in s. 383(1)(b) inserted (6.4.2016) by Enterprise and Regulatory Reform Act 2013 (c. 24), s. 103(3), Sch. 19 para. 53(b); S.I. 2016/191, art. 2 (with art. 3)

Modifications

  1. C1118S. 383 applied with modifications by S.I. 1986/1999, art. 3, Sch. 1 Pt. II