UK Offence Report

Sections 211 and 356: False representations to creditors

paragraph 25 of SCHEDULE 4 of The Insolvent Partnerships Order 1994

This offence was read from the text as made, and no revised version was available, so a later revocation could not be ruled out. Check the current text at legislation.gov.uk.

What the provision says

2 Any person, being

a past or present officer of the partnership or

a past or present officer (which for these purposes includes

a shadow director) of

a corporate member against which an insolvency order has been made—

a commits an offence if he makes any false representation or commits any other fraud for the purpose of obtaining the consent of the creditors of the partnership (or any of them) or of the creditors of any of its members (or any of such creditors) to an agreement with reference to the affairs of the partnership or of any of its members or to the winding up of the partnership or of

a corporate member, or the bankruptcy of an individual member, and

b is deemed to have committed that offence if, prior to the winding up or bankruptcy (as the case may be), he has made any false representation, or committed any other fraud, for that purpose.

Text as made, from legislation.gov.uk. © Crown copyright, reused under the Open Government Licence v3.0. This is the text as originally made; later amendments are not shown here.

Who it binds, and what has to be proved

Binds
a person
Conduct
making a false or misleading statement
Fault element
Requires proof of a state of mind
Burden of proof
No statutory defence — prosecution proves everything

The prosecution must prove both that the conduct happened and that it was done with the state of mind the provision names (for the purpose of obtaining).

The provision states no defence, so the prosecution bears the burden on every element of the offence.

Classifier’s reasoning: mens rea word in the offence-creating words: for the purpose of obtaining.

What would breach paragraph 25 of SCHEDULE 4?

These are illustrations, not law. They are generated from the provision’s own words to show the shape of the offence. Whether any particular conduct is caught depends on the full text, on any amendment since, and on the facts.

  1. Entering a figure on a form or return that is known to be wrong under the Insolvent Partnerships Order 1994.
  2. Leaving out something the form asks for, where the omission is what makes the answer misleading.
  3. Producing a document to an official that has been altered since it was issued.

Penalty

Mode of trial
Not determined
Maximum fine
Not determined
Maximum prison (summary)
Not determined

no penalty is stated in this instrument; it may be in the enabling Act, or in a general penalties provision this pass did not connect to the offence.

No penalty was determined from this instrument. It may be in the enabling Act, or in a general penalties provision this pass did not connect to the offence. Absence of a figure here is not evidence that the offence carries no penalty.

Sentencing

Offences of this kind are usually sentenced under the guidelines below. This is a mapping by subject, not a finding about this provision, and the links go to a search of the Sentencing Council’s own site.

Prosecution figures

No published per-offence figure was found for this provision, and it could not be matched to a Ministry of Justice offence code. Offences created by statutory instrument very largely do not have one. Absence of a figure is not evidence that the offence is unused.

Status and lifecycle

Current status
Status not determined
Made
13 September 1994
In force from
1 December 1994
Extent
E+W

How this was established: read from the text as made; no revised version available, so later revocation could not be ruled out.

What the instrument is for

(This note is not part of the Order) — the explanatory note published with the instrument, © Crown copyright.

This Order revokes and replaces the Insolvent Partnerships Order 1986 (S.I. 1986/2142) (“the 1986 Order”). Like the 1986 Order it provides a code for the winding up of insolvent partnerships, but it also introduces two new procedures— voluntary arrangements and administrations— for insolvent partnerships. The Order differs in form from the 1986 Order in that, rather than making textual amendments to the provisions of the Insolvency Act 1986 (c. 45) (“the Act”) applied by the Order with modifications, it sets the modified provisions out in full in the Schedules to the Order. In so doing, many of the provisions applying to partnerships, individual members and corporate members (as defined in article 2) have been amalgamated. The following are the main provisions of the Order, and the main changes made to the 1986 Order:— Article 4 and Schedule 1 apply Part I of the Act (company voluntary arrangements) to insolvent partnerships for the first time, with appropriate modifications. Article 6 and Schedule 2 apply Part II of the Act (administration orders) to insolvent partnerships for the first time, with appropriate modifications. Where an insolvent partnership is wound up under Part V of the Act as an unregistered company without involving the concurrent insolvency of any of its members, separate provision is now made depending on whether the winding up is on the petition of a creditor, a responsible insolvency practitioner or the Secretary of State (article 7 and Schedule 3) or a member’s petition (article 9 and Schedule 5). A main change from the corresponding provisions in the 1986 Order is that the jurisdictional requirements of the 1986 Order have been modified so far as creditors' petitions are concerned. Under the 1986 Order the courts in England and Wales only had jurisdiction if the partnership had a principal place of business in England and Wales. Under the Order, whilst that remains the case on a member’s petition, the court also has jurisdiction on a creditor’s petition if the insolvent partnership has a place of business in England and Wales (which in the case of the county court must be in the relevant insolvency district) at which business is carried on in the course of which the petition debt arose (Schedule 3 paragraphs 3 and 6; Schedule 5, paragraphs 1 and 2). Special rules apply for partnerships which also have a principal place of business in Scotland or Northern Ireland. Where the winding up of an insolvent partnership involves the concurrent insolvency of its members, separate provision is now made depending on whether the appropriate petitions are presented by a creditor (article 8 and Schedule 4) or a member (article 10 and Schedules 4 and 6). Other main changes from the 1986 Order are:— on a creditor’s petition, a minimum of one member (rather than two as previously) needs to be made insolvent concurrently with the partnership (article 8(1)); the jurisdictional requirements are as set out in paragraph 3 of this Note (Schedule 4, paragraphs 3 and 5; Schedule 6, paragraphs 1 and 4); the Order makes further modifications to section 271 of the Act which was the subject of a decision of the Court of Appeal in In Re Marr (A Bankrupt) (1990 2 WLR 1264) (Schedule 4 paragraph 9; Schedule 6, paragraph 3); on the making of a bankruptcy order against an individual member the official receiver no longer becomes receiver and manager pending the appointment of a trustee, but becomes trustee unless and until another responsible insolvency practitioner (as defined in article 2) is appointed in his place (Schedule 4, paragraph 12); the Order removes the mandatory requirement under section 136 of the Act as modified by the 1986 Order for the official receiver to summon a meeting of creditors to choose a person to be responsible insolvency practitioner in his place and replaces it with a discretion to do so, as is the case in section 136 in unmodified form. The official receiver is however under a duty to consider the exercise of that discretion under section 136A (Schedule 4, paragraph 12); and Schedule 4, paragraphs 23 and 24 contain modified provisions on the order of priority of payment of expenses and debts out of the joint and separate estates. In particular, where the joint estate is not sufficient for the payment of the joint debts, it provides for the responsible insolvency practitioner to lodge a claim representing the aggregate value of the outstanding amount of those debts in the separate estate of each member against whom an insolvency order has been made. Provision for the individual members of an insolvent partnership to present petitions for their bankruptcy (provided there are no corporate or limited partners) is now made by article 11 and Schedule 7. Main changes from the 1986 Order are:— the court may issue a certificate of summary administration of the estate of any qualifying member (Schedule 7, paragraph 6); and Schedule 7, paragraph 21 contains modified provisions on the order of priority of payment of expenses and debts out of the joint and separate estates. In particular it makes provisions similar to those referred to in paragraph 4(f) above. Article 16 and Schedule 8 apply specified provisions of the Company Directors Disqualification Act 1986 (c. 46) where an insolvent partnership is wound up as an unregistered company under Part V of the Act. The relevant forms for use in proceedings under the Order are contained in Schedule 9 (article 17). Article 18 and Schedule 10 specify the subordinate legislation which is to apply for the purposes of giving effect to the provisions of the Act and of the Company Directors Disqualification Act 1986 applied by the Order. Article 19 of the Order contains supplemental and transitional provisions. A Compliance Cost Assessment is available, copies of which have been placed in the libraries of both Houses of Parliament. Copies are also available from The Insolvency Service of the Department of Trade and Industry, PO Box 203, Room 5.1, 21 Bloomsbury Street, London WC1B 3QW.

Read the full note and every offence in this instrument

What Parliament said

Mentions of this instrument in Hansard. Parliamentary material is reused under the Open Parliament Licence v3.0.

How this was identified as an offence

Everything above rests on the judgement that this provision creates a criminal offence, rather than mentioning one. That judgement is made by rule, from the words of the provision, and this is the rule that made it — with a confidence of 0.92.

Basis
the provision says a person “commits an offence”
Confidence
0.92 of 1.00

A provision that states a penalty for an offence created elsewhere can read very like one that creates an offence, and the rules can mistake the one for the other. If the text quoted above sets a penalty for something made an offence by another provision, treat the classification on this page with that in mind, and read the instrument.

Check the source