FOI reference: FOI/18/00356
Date received: 30 January 2018
Date responded: 15 February 2018
1. Can a discharged debtor be served with an income payments order? I reference Section 32 of The Bankruptcy (Scotland) Act 1985 for information.
2. If so, what circumstances would warrant such a move by the debtor's ex trustee?
3. What documents, guidelines or codes of practice do trustees in bankruptcy have access to from the AiB in relation to ensuring they follow the correct processes and procedures relating to the compilation and submission of bankruptcy restriction orders?
4. Are they compelled to follow these instructions from the AiB?
5. If they are not compelled to follow the AiB's instructions, what leeway/freedoms are they permitted to follow?
I shall address your questions in the order they were presented.
1 & 2. It should be highlighted that Income Payment Agreements (IPA) and Income Payment Orders (IPO) only apply to sequestrations awarded on or before 31 March 2015. The Debtor Contribution Order replaced the IPA/IPO and is now a requirement for sequestrations awarded on or after 1 April 2015, under Section 32A of The Bankruptcy (Scotland) Act 1985, as amended/Section 90 of the Bankruptcy (Scotland) Act 2016.
IPA - The trustee would look at the income of the debtor and how much debtor and their family need to live on. They would assess whether or not the debtor had any surplus income and, if they did, they would expect the debtor to make a contribution from that. The trustee would agree a voluntary contribution amount with the debtor.
IPO - If a voluntary agreement could not be reached between the debtor and trustee, or the debtor had signed an IPA but failed to comply, section 32(2) of the Bankruptcy (Scotland) Act 1985, as amended (the Act), provided for the trustee to apply to the sheriff for an IPO. No application could be made to the court for an IPO after the date of the debtor's discharge, unless authorised by a sheriff under section 32(2WA) of the Act. An IPO made by the sheriff, would detail the amount of the income contribution and the period which it is effective. That period may be after the date of the debtor's discharge, but no later than three years after the date the IPO was made.
Section 4.13 of the Notes for Guidance for Trustees (Bankruptcies granted between 1 April 2008 and 31 March 2015) provides further guidance.
3, 4 & 5. Section 6.3 of the Notes for Guidance for Trustees provides direction to trustees if they believe that the debtor's behaviour falls under section 156 of the Bankruptcy (Scotland) Act 2016. The trustee must complete the submission form provided at Annex K to these notes. The submission form requires the trustee to detail the grounds under which they are requesting an investigation and a summary of events. The trustee will also provide evidence to support the submission. When the submission is received by AiB, it will be reviewed to ensure it is in the public interest to proceed with a BRO investigation, the Investigation Officer will interview the debtor, in-gather information and evidence to effectively support or reject, the grounds that a debtor's behaviour merits a BRO.
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Please quote the FOI reference
Central Enquiry Unit
Phone: 0300 244 4000
The Scottish Government
St Andrew's House