- What is ‘property’ for the purpose of section 284 of the Insolvency Act 1986? (Re Derek Thomas Hood)
- What are the practical implications of this case?
- What was the background?
- What did the court decide?
- Case details
Restructuring & Insolvency analysis: The court held that payments made by a third party to a petitioning creditor in satisfaction of a petition debt are not to be considered property of the debtor. That conclusion applies whether the third party’s payment is made by way of gift, or with a corresponding obligation on the part of the debtor to repay the paying party. The court held that, in those circumstances, the court was precluded from making an order giving the respondent change of carriage of the petition. If that result appeared to contravene the pari passu principle, that was a result that nevertheless arose from the wording of the legislation. It also explained the differential treatment between creditors who sought substitution, and those who sought change of carriage. Written by Samuel Parsons, barrister, at Guildhall Chambers, Bristol.
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