The following Restructuring & Insolvency guidance note Produced in partnership with Martha Maher retired barrister of St John’s Chambers provides comprehensive and up to date legal information covering:
The pre-Insolvency Act 1986 (IA 1986) common law adopted a rule of convenience that in administering the estates of an insolvent partnership and its members, the debts of the firm ought to be paid out of the assets of the firm and the private debts of a member or members ought to be paid out of the assets of the member or members. In the event of a deficiency in either estate then it would be made good by any surplus in the other estate or estates (see Re Rudd & Son).
This Practice Note addresses the rules applicable to cases falling within the scope of the Insolvent Partnerships Order 1994 (IPO 1994), SI 1994/2421. For a discussion of what constitutes the assets of a general partnership, see Practice Note: The nature of a general partnership and its legal framework and News Analysis: Court finds property only an asset of partnership where agreed by partners (Wild v Wild and Others) .
The provisions in IA 1986, s 176A relating to the 'prescribed part', which reserves a share of floating charge assets for unsecured creditors, is not applicable (Insolvent Partnerships Amendment Order 2006 SI 2006/622, arts 6, 7, 8, 9 amending IPO 1994, SI 1994/2421 Sch 3 (art 7 cases), IPO 1994, SI 1994/2421 Sch 4 (art 8 cases), IPO
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