Role, powers, functions and duties of a trustee in bankruptcy

The following Restructuring & Insolvency practice note provides comprehensive and up to date legal information covering:

  • Role, powers, functions and duties of a trustee in bankruptcy
  • The role and function of the trustee
  • Duties of the trustee
  • General duties
  • Duties to the OR
  • Control of the trustee
  • Control by the court
  • Control by the creditors' committee or Secretary of State
  • Control by professional bodies
  • Trustee's liabilities
  • More...

Role, powers, functions and duties of a trustee in bankruptcy

This Practice Note looks at the roles, powers, functions and duties of the trustee in bankruptcy (trustee). This Practice Note is drafted from the point of view that an insolvency practitioner (IP) has been appointed as a trustee and does not specifically look at the official receiver's (OR) duties when acting as trustee.

The role and function of the trustee

The general function and role of the trustee is to get in, realise and distribute the bankruptcy estate in accordance with sections 305–335 of the Insolvency Act 1986 (IA 1986). The trustee's other major function is to review, adjudicate on and agree creditors' claims.

As part of the process of dealing with the trustee's general functions, they will need to consider what assets belong to the bankruptcy estate and secure them, so that they can be realised. For further reading on the steps they should take, see Practice Note: Protecting a trustee in bankruptcy's interest in property following their appointment.

A trustee must be licensed by a recognised professional body, qualified to act, and have a sufficient bond in place, which is in effect an insurance policy for creditors. Because of this, trustees have several duties imposed on them which must be performed to a high standard. The trustee's main duties are considered below.

Duties of the trustee

The duties of

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