Charity insolvency—a guide to available insolvency procedures
Produced in partnership with Rebecca Walker of Lester Aldridge LLP
Charity insolvency—a guide to available insolvency procedures

The following Restructuring & Insolvency practice note produced in partnership with Rebecca Walker of Lester Aldridge LLP provides comprehensive and up to date legal information covering:

  • Charity insolvency—a guide to available insolvency procedures
  • Available insolvency procedures
  • Companies limited by guarantee
  • Charitable incorporated organisations (CIOs)
  • Community benefit societies (formerly known as industrial and provident societies)
  • Unincorporated associations and charitable trusts

Charity insolvency—a guide to available insolvency procedures

FORTHCOMING CHANGE: On 22 March 2021, the government published its response  to the Law Commission’s report of 14 September 2017, ‘Technical Issues in Charity Law’. The Report stemmed in part from Lord Hodgson’s review in July 2012 pursuant to section 73 of the Charities Act 2006 (ChaA 2006), ‘Trusted and Independent: Giving charity back to charities’. The Report made 43 recommendations, in 12 areas. The Response wholly or partially accepted 38 of the recommendations – including in relation to charity insolvency. For a commentary on the Response please see News Analysis: Government response to Law Commission report ‘Technical Issues in Charity Law’. It is worth bearing the proposals – and the Response – in mind when considering and advising on charity law in general. 

The Law Commission recommended that (a) disposals of land by liquidators, provisional liquidators, administrators, receivers and mortgagees be excluded from Part 7 of the Charities Act 2011; and (b) the exception in section 117(3)(c) of the Charities Act 2011 be reformulated such that it applies only to disposals that are solely intended to further the transferor charity’s purposes. The government accepted these recommendation as (a) liquidators, provisional liquidators, administrators, receivers and mortgagees already have duties to ensure they obtain a reasonable price to ensure the best result for the creditor(s); and (b) this will ensure that where the

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