Property Auction Solicitors and Bankruptcy Orders by Ford Banks Irwin Solicitors - The Property Lawyers in Manchester
Please note: Not to be used or relied upon without legal advice. These notes are for illustrative purposes ONLYProperty Auctions Solicitors and Bankruptcy Orders
continued from page 1 - Property Auction Solicitors and Bankruptcy Orders
What happens if the bankruptcy order is annulled?
The Court may order an annulment if either:
*it appears that the bankruptcy order ought not to have been made;
* the Court is satisfied that the bankrupt's debts and expenses have been repaid or adequately secured;
*a voluntary arrangement has been made with the creditors.
How to remove bankruptcy entries from Land Charges Department after an annulment?
Any Court Order annulling a bankruptcy order must include provisions for the bankruptcy entries in the Land Charges registers to be cancelled.
The Court, however, will not apply to the Land Charges Department to have the entries removed. The bankrupt's Solicitors will complete the correct form and submit the appropriate fee to the Land Charges Department.
The application form must be accompanied by a copy of the Court Order that expressly provides for the cancellation (or vacation) of the bankruptcy entry in the Land Charges register under the reference number specified in the bankruptcy notice. A certificate of discharge is not sufficient for this purpose.
After the Land Charges Department has dealt with the application to remove the bankruptcy entries - usually on the same day as the application is received - they will inform the bankrupt's Solicitors that the entry has been removed.
How remove the bankruptcy entries from the Land Registry Property Title Deeds after an annulment?
Court Order: The bankruptcy's Solicitors must submit the correct form and include with it a copy of the Court Order annulling the bankruptcy order. The Court Order should also expressly authorise the cancellation of the entry in the Land Charges register under the reference number specified in the bankruptcy restriction.
The Court Order must be the original or a certified by the Solicitors as a true copy of the original Court Order.
If the registered Property or registered Mortgage has been registered in the name of the Trustee in Bankruptcy, then the bankrupt's Solicitors will need to arrange for the Property to re-registered in the bankrupt's name.
In cases where there is more than one owner of the Property the Solicitors should apply to the Land Registry to remove the restriction by submitted the correct form and the Court Order.
Where the owner is not the debtor: If you, as the owner of the Property, are not the bankrupt, your Solicitors can apply to Land Registry for removal of the bankruptcy restriction on that basis. The requirements are the same other than in place of the Court Order, you must sent a signed statement to the effect that you are not the bankrupt named in the bankruptcy proceedings referred to in the Register of the Property Title Deeds. If the registrar is satisfied that this is the case, the bankruptcy restriction will be cancelled. In some cases the Registrar will ask for a statutory declaration as opposed to a statement.
What happens when the bankrupt is discharged from bankruptcy?
Entries in the Land Charges registers: When a bankrupt is discharged from bankrupts the bankruptcy entires in the Land Charges registers cannot be cancelled unless the Court expressly orders them to be. The reason for this is that, unlike most orders annulling a bankruptcy order, Property that is still vested in the trustee in bankruptcy does not re-vest automatically in the former bankrupt upon discharge. If the former bankrupt obtain a Court Order providing expressly for cancellation of the bankruptcy entries in the Land Charges registers, it is for the former bankrupt's Solicitors to apply to the Land Charges Department for the entries to be removed.
Bankruptcy entries are automatically removed from the Land Charges register five years after the bankruptcy order was registered in the register of writs and orders, unless an application has been made to renew the entries. This means that, normally, entries will come off the Land Charges register some time after the bankrupt is discharged, without the need to apply.
Entries in the Title Register at Land Registry: A bankruptcy restriction in a Title Register will not be removed just because one of the following applies:
*the bankrupt has been discharged from bankruptcy, regardless of whether there is a certificate of discharge;
*On or after discharge the former bankrupt has obtained an Order from the Court for cancellation of the bankruptcy entries in the Land Charges Registers;
*five years have passed since the bankruptcy order was made in the register of writs and orders
*the Trustee in Bankruptcy consents to the removal of the bankruptcy entries.
Property that has been transferred automatically to the Trustee in Bankruptcy and has not been transferred by the Trustee, remains in the Trustee's ownership, even though the bankrupt has been discharged - unlike the usual position where a bankruptcy order is annulled.
When the Property is still in the Trustee's ownership, the former bankrupt will need a transfer from the Trustee in Bankruptcy. It will be a matter for the Trustee to decide whether to transfer the Property and if so on what terms. If the Trustee transfers the Property to the former bankrupt, the bankrupt's Solicitors should send to HM Land Registry:
*a copy of the bankruptcy order
*a certificate signed by the Trustee in bankruptcy that the registered estate is comprised in the former bankrupt's estate
*the transfer deed signed by the Trustee in Bankruptcy
*application form
If the Trustee in Bankruptcy is not the Official Receiver, one of the following documents will also be required:
*a certificate of appointment as Trustee by a meeting of creditors;
*a certificate of appointment as Trustee by the Secretary of State;
*a Court Order making the appointment
If there is a restriction in the Property Title Deeds, this can be withdrawn by the person who applied to enter it (that is, the Official Receiver or Trustee in Bankruptcy).
Unfamiliar Terms explained:
Bankrupt - the person against whom the bankruptcy order by the Court is made
Bankruptcy Notice - the entry made in the Property Title Deeds in respect of a bankruptcy petition;
Bankruptcy restriction - the entry made in the Property Title Deeds in respect of the bankruptcy order
Creditor - the person who presented the bankruptcy petition.
Debtor - the person against whom the petition was made;
Estate - a person's interest in Land or Property, that may be freehold or leasehold.
Land Charges Register - the registers kept by the Land Charges Department, including the register of pending actions
Register of pending actions - the register the Land Charges Department maintains in respect of pending land actions and petitions in bankruptcy
Register of writs and orders - the register the Land Charges Department maintains in respect of writs and orders affecting land and includes bankruptcy orders notified by the Court
Title Register - the individual register of the Property Title Deeds held for each separate estate by Land Registry.
(All italics in this page are Crown Copyright and reproduced here for your information with permission from HM Land Registry)
Placing the bankrupt's Property in an Auction:
Many Property Law Solicitors and Lawyers are asked to prepare an Auction Pack for Properties that are to be sold by Trustees of the Bankrupt at a Property Auction.
The Solicitor or Lawyer will liaise with the Trustees to choose the searches to be included in the Property Auction Pack.
The Solicitor or Lawyer will complete the sale of the Property following the Auction and place the sale proceeds with the Trustees. The Trustees can then distribute the funds in accordance with the Court Order.
For any further information please contact Ford Banks Irwin Solicitors.