The following Restructuring & Insolvency guidance note provides comprehensive and up to date legal information covering:
This Practice Note contains a summary of individual voluntary arrangements (IVAs) and their impact on legal proceedings from a dispute resolution perspective.
An IVA is an agreement entered into between an individual and their creditors (and possibly with third parties) for a composition of that person’s debts or a scheme of arrangement of their affairs under the Insolvency Act 1986 (IA 1986). The type and content of the composition or scheme is a matter for the debtor and their creditors with the assistance of an insolvency practitioner (who is described as the nominee before the IVA is approved, and the supervisor after).
IVAs are proposed in circumstances where an individual is in financial difficulties, and usually following the presentation of a bankruptcy petition or to avoid a threatened bankruptcy petition. The aim of the IVA is usually the release of liabilities outside of the context of bankruptcy, without the stigma and prohibitions that bankruptcy entails.
An IVA binds those creditors who voted against the proposal (or who did not vote at all) provided the requisite majority of votes in favour were obtained and subject to possible challenges.
Before the IVA is approved it is possible for the debtor to apply for an interim order, staying legal proceedings while the IVA
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