Since
Dear IP 72 was published, the IS have also updated their internal guidance for Official
Receivers (“OR”) which is contained in chapter 17 of their Technical Manual. Whilst it is internal Guidance, it is
available under the Freedom of Information provisions and can be found by
clicking here. It expands on Dear IP 72 in some areas and clarifies
some points, which begs the question why not just provide the text from that
guidance in the Dear IP rather than trying to precis it?
A
couple of points we noticed when reading the OR’s Technical Guidance. First, clarification for those who have a
relationship with HMRC to investigate cases.
Dear IP 72 suggested that if HMRC are the majority creditor then it will
be a rota appointment, but the Guidance indicated that in cases where HMRC “are
pursuing recoveries more actively than usual and other cases in which they have
a special interest” then a rota appointment is not appropriate and they will
nominate an IP.
Secondly,
a point that was not covered in Dear IP 72.
According to the internal guidance, when the OR decides that “the next
insolvency practitioner on the rota will not have the skills required to
administer the estate, for example where assets are located abroad”. In that situation the OR can seek the appointment
of an IP they consider has the necessary skills out of turn from the rota “or
otherwise”. The internal guidance does
indicate that these should be rare occasions, but does the IP actually know
enough about the IP firms on their rotas to make such a judgement without first
asking the IP themselves whether it is a case they are capable of
administering? After all, having the
necessary skills and resources to deal with a case is something for the IP to
consider under the Insolvency Code of Ethics before taking on a case. The implication of the internal guidance is
that IPs would not follow the Code of Ethics if they were approach by the OR
about such a job.
Finally,
since Dear IP 72 was released we also had the inaugural Insolvency Live! Event
hosted by the IS. In her opening remarks
the Agency Chief Executive, Sarah Albon, confirmed that creditors can appoint
an IP in a case if they want. I was in
the audience and was very pleased to hear that announcement being made, but at
the moment it is at odds with both Dear IP 72 and the OR’s Technical Guidance. Perhaps we will have a Dear IP 73 that
clarifies the position and addresses the differences between Dear IP 72, the
OR’s internal guidance and the Agency Chief Executive’s statement?
