No First Meeting

August 2006

Introduction

i when would the Official Receiver decide not to hold a first meeting?

The official receiver would not hold a meeting in cases where there are insufficient realisable assets to justify the appointment of an Insolvency Practitioner (IP) as trustee or liquidator by the creditors. However, where it is essential to get an IP into office at a very early stage (e.g. there is an ongoing business) an application to the Secretary of State for the appointment of a trustee or liquidator may be made. This is done without holding a meeting of creditors and a notice of the official receiver's decision not to hold a meeting (form NNM) must be sent to court. For further information on this subject please refer to the Case Help Manual: Appointment of Trustees and Liquidators by the Secretary of State.

 

ii who needs to be told of the decision?

The official receiver must give formal notice to all known creditors and (in companies) contributories, and to the court. This is done by sending form NNM (Notice of No Meeting)  In the majority of cases the official receiver's report to creditors will be sent out with this notice.

 

iii what effect does sending the notices have?

Generally, when a bankruptcy order is made the official receiver becomes receiver and manager of the estate. Where the official receiver decides not to summon a meeting of creditors, he/she becomes trustee of the bankrupt's estate upon the date that the notice to that effect is given to the court.

Even though the official receiver becomes liquidator of a company upon the making of a winding-up order at court, he/she is still required to make a decision as to whether or not to hold a meeting. In not holding a meeting, the official receiver is in effect deciding to keep the liquidation in his/her own hands.

 

Notes

  1. When completing the notice of no meeting (form NNM) you will need to know whether the no meeting decision has been made especially so that an application can be made to the Secretary of State for the urgent appointment of an IP. The examiner will tell you if this is the case.
  2. Where the case has not yet been transferred to a local court, care must be taken that the notice to the court of the no meeting decision (form NNM) is addressed to the local court with the local reference and not to the High Court.

 

Where can I find out more?

Technical Manual Chapter 16, particularly paras 16.5 and 16.9 - 16.10.

Insolvency Act 1986:

Section 293 Duty of OR to decide

Section 136 Functions of OR as liquidator

Case Help Manual: Appointment of Trustees and Liquidators by the Secretary of State.

LOIS Workbook: Meetings

Forms to be used:

NNM     Notice of No Meeting 

 

Click HERE to view the flowchart Showing No Meeting Held Procedure 

 

Procedure

LOIS screen references are given in brackets eg (DO73).

  1. Receive instruction that there is to be no meeting according to the practice within your local office. The examiner will have saved an approved Report to Creditors (CAR A form) in a file on the Shared Drive. Check that all the information on LOIS is correct and updated including the creditors details.
  2. Ensure that the notices will be dispatched within the 12 week deadline. If not, inform the B1 and prepare an application to court for an extension of time. Send 2 copies of the application to court for sealing, one of which will be kept by the court and the other returned to the OR. Upon return from court, a copy should be placed on the office file.
  3. Prepare form NNM (Notice of No Meeting) on LOIS (DO73) and send to all known creditors (and in a company, the contributories) together with a copy of the Report to Creditors (CAR A form). The approved CAR A form should be passed to the case officer by the examiner according to your local office procedure. As in step 1 the examiner will have saved an approved RTC in a file on the S Drive. Also, a notice of No Meeting (NNM) must be filed at court. In bankruptcy matters, this is important as the date that this notice is sent to court becomes the effective date of the OR as trustee.
  4. Where the reason for issuing a NNM is to facilitate an early IP appointment, prepare an application to the Secretary of State (SoS) following the guidelines given in the Case Help Manual: Appointment of Trustees and Liquidators by the Secretary of State. At this stage, it may only be necessary to prepare 1 copy of the NNM for filing at court. In a bankruptcy, the OR is not able to apply to the SoS until this has been done. Thus, it may be necessary to delay the issuing of the NNM to the creditors until the SoS has appointed the IP as trustee/liquidator. The examiner will inform you of how to proceed.
  5. Note LOIS with the date that the Notice of No Meeting (NNM) was issued (CA21).
  6. Check that the list of creditors on LOIS is complete, including any references, etc. (CA31).