Insolvency Act · s 32

Suggest a correction

Tell us what is wrong in this text. We check every suggestion against the official version before we change anything.

What is wrong?Wrong or mistyped wordsWrong structure or numberingWrong title or detailsText that appears twice

What should change, and whyUp to 2,000 characters.The text as it should read (optional)

32.
Application to Court for company to be placed under judicial management and for appointment of judicial manager
(1) Where a company or where a creditor or creditors of the company consider that —
(a) the company is or will be unable to pay its debts; and
(b) there is a reasonable probability of rehabilitating the company or of preserving all or part of its business as a going concern or that otherwise the interests of creditors would be better served than by resorting to a winding up, an application may be made to the Court for an order that the company be placed under the judicial management of a judicial manager.
(2) Where a company or its directors (pursuant to a resolution of its members or the board of directors) or a creditor or creditors (including any contingent or prospective creditor or creditors or all or any of those parties, together or separately), makes an application for a judicial management order under subsection (1), the Court may make a judicial management order in relation to the company if, and only if —
(a) it is satisfied that the company is or will be unable to pay its debts; and
(b) it considers that the making of the order would be likely to achieve one or more of the following purposes —
(i) the survival of the company, or the whole or part of its undertaking as a going concern;

Insolvency
(ii) the approval under section 13 of a voluntary arrangement between the company and any such creditors or members as are mentioned in that section or the Brunei Darussalam Central Bank;
(iii) a more advantageous realisation of the company’s assets would be effected than on a winding up.
(3) Any judicial management order made under subsection (2) shall direct that during the period in which the order is in force, the affairs, business and property of the company shall be managed by a judicial manager appointed for the purpose by the Court; and such an order shall specify the purpose or purposes for whose achievement the order is made.
(4) (a) In an application for a judicial management order under subsection (1), the applicant shall nominate a person who is a public accountant, who is not the auditor of the company, to act as a judicial manager.
(b) The Court may reject the nomination of the applicant and appoint another person in his stead.
(c) Where a nomination is made by the company, a majority in number and value of the creditors (including contingent or prospective creditors) may be heard in opposition to the nomination and the Court may, if satisfied as to the value of the creditors’ claims and as to the grounds of opposition, invite the creditors to nominate a person in his stead and, if it sees fit, adopt their nomination.
(d) Nothing in this subsection shall prevent the Minister from himself nominating a person to act as a judicial manager if he considers that the public interest so requires and in such a case the
Minister may be heard in support of his nomination and for this purpose may be represented.
(e) Notwithstanding paragraph (a), where a person is appointed by the Court or nominated by the Minister to act as a judicial manager that person need not be a public accountant.

Insolvency 46
(5) When an application for a judicial management order is made under subsection (1), notice of the application —
(a) shall be published in the Gazette and in a Malay and English local daily newspaper, and a copy thereof sent to the Registrar; and
(b) shall be given —
(i) to the company, in a case where a creditor is the applicant; and
(ii) to any person who has appointed or is or may be entitled to appoint a receiver and manager of the whole
(or substantially the whole) of the property of a company under the terms of any debenture of a company secured by a floating charge or by a floating charge and one or more fixed charges.
(6) Subject to subsection (11), the Court shall dismiss an application for a judicial management order if it is satisfied that —
(a) a receiver and manager referred to in subsection (5) has been or will be appointed; or
(b) the making of the order is opposed by a person who has appointed or is entitled to appoint such a receiver and manager.
(7) On hearing the application for a judicial management order, the
Court may —
(a) dismiss the application or adjourn the hearing conditionally;
or
(b) unconditionally or make an interim order or any other order that it thinks fit.
(8) A judicial management order shall not be made in relation to a company —
(a) after the company has gone into liquidation;
(b) where the company is a bank licensed under the
Banking Order, 2006 (S 45/2006), Islamic Banking Order, 2008

Insolvency

(S 96/2008), International Banking Order, 2000 (S 53/2000) or is a finance company licensed under the Finance Companies Act
(Chapter 89); or
(c) where the company is an insurance company registered under the Insurance Order, 2006 (S 48/2006) or a takaful company registered under the Takaful Order, 2008 (S 100/2008).
(9) A judicial management order shall, unless it is otherwise discharged, remain in force for a period of 180 days from the date of the making of the order but the Court may, on application of a judicial manager, increase this period subject to such conditions as the Court may impose.
(10) The costs and expenses of any unsuccessful application for a judicial management order made under this section shall, unless the Court otherwise orders, be borne by the applicant and, if the Court considers that the application is frivolous or vexatious, it may make such orders, as it thinks just and equitable, to redress any injustice that may have resulted.
(11) Nothing in this section shall preclude a Court from —
(a) making a judicial management order and appointing a judicial manager if it considers the public interest so requires; or
(b) appointing, after the making of an application for a judicial management order and on the application of the person applying for the judicial management order, an interim judicial manager, pending the making of a judicial management order, and such interim judicial manager may, if the Court sees fit, be the person nominated in the application for a judicial management order. The interim judicial manager so appointed may exercise such functions, powers and duties as the Court may specify in the order.
(12) Any person who has acted as Executive Manager of the company in respect of which a judicial management order is sought may be appointed judicial manager of that company by the Court.
(13) For the purposes of this section, “unable to pay debts” has the meaning assigned to it in section 100.

Insolvency 48

Edit the text above. Up to 20,000 characters.Where you checked it (optional)A link to the official version, if you have one.

The text as we hold it

Open the official text

s 32Application to Court for company to be placed under judicial management and for appointment of judicial manager

(1)

Where a company or where a creditor or creditors of the company consider that —

(a)

the company is or will be unable to pay its debts; and

(b)

there is a reasonable probability of rehabilitating the company or of preserving all or part of its business as a going concern or that otherwise the interests of creditors would be better served than by resorting to a winding up, an application may be made to the Court for an order that the company be placed under the judicial management of a judicial manager.

(2)

Where a company or its directors (pursuant to a resolution of its members or the board of directors) or a creditor or creditors (including any contingent or prospective creditor or creditors or all or any of those parties, together or separately), makes an application for a judicial management order under subsection (1), the Court may make a judicial management order in relation to the company if, and only if —

(a)

it is satisfied that the company is or will be unable to pay its debts; and

(b)

it considers that the making of the order would be likely to achieve one or more of the following purposes —

(i)

the survival of the company, or the whole or part of its undertaking as a going concern;

Insolvency

(ii)

the approval under section 13 of a voluntary arrangement between the company and any such creditors or members as are mentioned in that section or the Brunei Darussalam Central Bank;

(iii)

a more advantageous realisation of the company’s assets would be effected than on a winding up.

(3)

Any judicial management order made under subsection (2) shall direct that during the period in which the order is in force, the affairs, business and property of the company shall be managed by a judicial manager appointed for the purpose by the Court; and such an order shall specify the purpose or purposes for whose achievement the order is made.

(4)

(a)

In an application for a judicial management order under subsection (1), the applicant shall nominate a person who is a public accountant, who is not the auditor of the company, to act as a judicial manager.

(b)

The Court may reject the nomination of the applicant and appoint another person in his stead.

(c)

Where a nomination is made by the company, a majority in number and value of the creditors (including contingent or prospective creditors) may be heard in opposition to the nomination and the Court may, if satisfied as to the value of the creditors’ claims and as to the grounds of opposition, invite the creditors to nominate a person in his stead and, if it sees fit, adopt their nomination.

(d)

Nothing in this subsection shall prevent the Minister from himself nominating a person to act as a judicial manager if he considers that the public interest so requires and in such a case the

Minister may be heard in support of his nomination and for this purpose may be represented.

(e)

Notwithstanding paragraph (a), where a person is appointed by the Court or nominated by the Minister to act as a judicial manager that person need not be a public accountant.

Insolvency 46

(5)

When an application for a judicial management order is made under subsection (1), notice of the application —

(a)

shall be published in the Gazette and in a Malay and English local daily newspaper, and a copy thereof sent to the Registrar; and

(b)

shall be given —

(i)

to the company, in a case where a creditor is the applicant; and

(ii)

to any person who has appointed or is or may be entitled to appoint a receiver and manager of the whole

(or substantially the whole) of the property of a company under the terms of any debenture of a company secured by a floating charge or by a floating charge and one or more fixed charges.

(6)

Subject to subsection (11), the Court shall dismiss an application for a judicial management order if it is satisfied that —

(a)

a receiver and manager referred to in subsection (5) has been or will be appointed; or

(b)

the making of the order is opposed by a person who has appointed or is entitled to appoint such a receiver and manager.

(7)

On hearing the application for a judicial management order, the

Court may —

(a)

dismiss the application or adjourn the hearing conditionally;

(b)

unconditionally or make an interim order or any other order that it thinks fit.

(8)

A judicial management order shall not be made in relation to a company —

(a)

after the company has gone into liquidation;

(b)

where the company is a bank licensed under the

Banking Order, 2006 (S 45/2006), Islamic Banking Order, 2008

Insolvency

(S 96/2008), International Banking Order, 2000 (S 53/2000) or is a finance company licensed under the Finance Companies Act

(Chapter 89); or

(c)

where the company is an insurance company registered under the Insurance Order, 2006 (S 48/2006) or a takaful company registered under the Takaful Order, 2008 (S 100/2008).

(9)

A judicial management order shall, unless it is otherwise discharged, remain in force for a period of 180 days from the date of the making of the order but the Court may, on application of a judicial manager, increase this period subject to such conditions as the Court may impose.

(10)

The costs and expenses of any unsuccessful application for a judicial management order made under this section shall, unless the Court otherwise orders, be borne by the applicant and, if the Court considers that the application is frivolous or vexatious, it may make such orders, as it thinks just and equitable, to redress any injustice that may have resulted.

(11)

Nothing in this section shall preclude a Court from —

(a)

making a judicial management order and appointing a judicial manager if it considers the public interest so requires; or

(b)

appointing, after the making of an application for a judicial management order and on the application of the person applying for the judicial management order, an interim judicial manager, pending the making of a judicial management order, and such interim judicial manager may, if the Court sees fit, be the person nominated in the application for a judicial management order. The interim judicial manager so appointed may exercise such functions, powers and duties as the Court may specify in the order.

(12)

Any person who has acted as Executive Manager of the company in respect of which a judicial management order is sought may be appointed judicial manager of that company by the Court.

(13)

For the purposes of this section, “unable to pay debts” has the meaning assigned to it in section 100.

Insolvency 48