Bankruptcy and family financial remedy proceedings

Copyright © 2025 LexisNexis

The impact bankruptcy and divorce proceedings have on one another has been subject to a number of cases in both the bankruptcy and family courts. Unfortunately, it is not uncommon for bankruptcy proceedings to be in existence while divorce proceedings are ongoing and concurrent proceedings can create conflict when it comes to the division of assets and the knock-on effect for the divorce proceedings.

In addition, there are instances of bankruptcy proceedings being commenced with the dominant intention of frustrating the divorce proceedings. The three main issues for bankruptcy proceedings and the effect they can have on financial remedy (formerly ancillary relief) applications are:

  1. •

    what is the general position of each court when there are concurrent bankruptcy and divorce proceedings?

  2. •

    what powers does the court have to set aside bankruptcy proceedings if they were commenced to defeat the divorce proceedings?

  3. •

    can the bankruptcy court unwind financial remedy orders (including property adjustment orders)?

The general position of each court when there are concurrent bankruptcy and divorce proceedings

If a bankruptcy petition is presented, or a bankruptcy order is made, before the family

To view the latest version of this document and thousands of others like it, sign-in with LexisNexis or register for a free trial.

Existing user? Sign-in TAKE A FREE TRIAL
Powered by Lexis+®
Latest Restructuring & Insolvency News

Restructuring & Insolvency weekly highlights—3 July 2025

This week's edition of Restructuring & Insolvency weekly highlights includes: an examination of a liquidator’s discretion to convert a members’ voluntary liquidation to a creditors’ voluntary liquidation (Noal SCSp v Novalpina Capital LLP), a discussion of the Supreme Court’s decision on undue influence in surety relationships in Waller Edwards v One Savings Bank Plc, plus a round-up of other news and cases for restructuring and insolvency professionals.

Insolvency Service reports 11-year director ban for BBL fraud

The Insolvency Service has reported the disqualification of building contractor Tahir Haq from serving as a company director for 11 years, accompanied by mandated compensation payments totalling £58,963 (including interest and costs). Haq obtained a £50,000 bounce back loan (BBL) for Integral Maintenance Team Ltd by overstating his company's turnover by £200,000, despite the company being entitled to only around £3,000. The disqualification, effective from 1 July 2025, prohibits Haq from promoting, forming, or managing any company without prior court approval.

Disputed debt and conversion of members’ voluntary liquidation to creditors’ voluntary liquidation (Noal SCSp and others v Novalpina Capital LLP (in members voluntary liquidation) and others)

Restructuring & Insolvency analysis: This judgment confirms that, if a company in members’ voluntary liquidation (MVL) is unable to pay its debts in full together with interest at the official rate within the period stated in the directors’ declaration made under section 89 of the Insolvency Act 1986 (IA 1986), then the company must be placed into creditors’ voluntary liquidation (CVL). There is no solvency test to justify varying this period. The company is already in liquidation and the liquidator has no discretion with regard to having to act under IA 1986, s 95 to convert the MVL to a CVL. Written by Andrew Mace, barrister at Tanfield Chambers.

Issue 168 of Insolvency Service’s Dear IP published

The Insolvency Service reports that the Information Sharing (Disclosure by the Registrar) Regulations 2024 (SI 2024/1378), effective from 20 December 2024, will enable the Registrar of Companies to disclose non-public information to insolvency practitioners (IPs) and The Financial Conduct Authority has published updated guidance (FG25/2) for IPs handling regulated firms, incorporating Consumer Duty requirements. Following the Pindar Scarborough Ltd (in Administration) [2024] EWHC 908 and Boughey & Anor v Toogood International Transport and Agricultural Service Ltd (in administration) [2024] EWHC 1425 court judgments, the Insolvency Service has revised its interpretation of 'creditor' status in terms of the Insolvency Act 1986 (IA 1986), adopting a context-specific approach rather than maintaining its previous fixed-point definition.

View Restructuring & Insolvency by content type :  
News
Practice notes
Precedents
Q&As

Popular documents

Challenging an individual voluntary arrangement (IVA)

Challenging an individual voluntary arrangement (IVA)Grounds to challenge an individual voluntary arrangementAn application can be made to challenge the approval of an individual voluntary arrangement (IVA) on one or both of two grounds:•that the creditors’ decision approving the IVA unfairly

Bankruptcy petitions—process and procedure

Bankruptcy petitions—process and procedure post-presentation of the petitionBefore the hearing of the creditors’ bankruptcy petition takes place, there are a number of steps that must be taken to comply with the procedural requirements set out in the Insolvency (England and Wales) Rules 2016 (IR

If a bankruptcy order is made against an individual in England who then moves outside of the EU to live,

If a bankruptcy order is made against an individual in England who then moves outside of the EU to live, would the individual be considered bankrupt in that foreign country? Would it be possible to pursue the individual for payment of a bankruptcy debt (as far as the English bankruptcy is concerned)

Priority between loss reliefs in loss making companies

Priority between loss reliefs in loss making companiesWhy does it matter?A company that is a member of a group and has incurred any of the types of losses available for surrender by way of group relief may, without any further rules, have more than one way in which to use the loss. There are a
Challenging an individual voluntary arrangement (IVA)

Challenging an individual voluntary arrangement (IVA)

Challenging an individual voluntary arrangement (IVA)Grounds to challenge an individual voluntary arrangementAn application can be made to challenge the approval of an individual voluntary arrangement (IVA) on one or both of two grounds:•that the creditors’ decision approving the IVA unfairly

Bankruptcy petitions—process and procedure

Bankruptcy petitions—process and procedure

Bankruptcy petitions—process and procedure post-presentation of the petitionBefore the hearing of the creditors’ bankruptcy petition takes place, there are a number of steps that must be taken to comply with the procedural requirements set out in the Insolvency (England and Wales) Rules 2016 (IR

If a bankruptcy order is made against an individual in England who then moves outside of the EU to live,

If a bankruptcy order is made against an individual in England who then moves outside of the EU to live,

If a bankruptcy order is made against an individual in England who then moves outside of the EU to live, would the individual be considered bankrupt in that foreign country? Would it be possible to pursue the individual for payment of a bankruptcy debt (as far as the English bankruptcy is concerned)

Priority between loss reliefs in loss making companies

Priority between loss reliefs in loss making companies

Priority between loss reliefs in loss making companiesWhy does it matter?A company that is a member of a group and has incurred any of the types of losses available for surrender by way of group relief may, without any further rules, have more than one way in which to use the loss. There are a