Insolvency Act · s 39

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39.
Power to deal with charged property etc.
(1) The judicial manager of a company may dispose of or otherwise exercise his powers in relation to any property of the company which is subject to a security to which this subsection applies as if the property were not subject to the security.
(2) Where, on application by the judicial manager of a company, the
Court is satisfied that the disposal (with or without other assets) —
(a) of any property of the company subject to a security to which this subsection applies; or
(b) of any goods under a hire-purchase agreement, chattels leasing agreement or retention of title agreement, would be likely to promote one or more of the purposes specified in the judicial management order, the Court may by order authorise the judicial manager to dispose of the property as if it were not subject to the security or to dispose of the goods as if all rights of the owner under the hire-purchase

Insolvency agreement, chattels leasing agreement or retention of title agreement were vested in the company.
(3) Subsection (1) applies to any security which, as created, was a floating charge and subsection (2) applies to any other security.
(4) Where any property is disposed of under subsection (1), the holder of the security shall have the same priority in respect of any property of the company directly or indirectly representing the property disposed of as he would have had in respect of the property subject to the security.
(5) It shall be a condition of an order made under subsection (2) that the net proceeds of the disposal shall be applied towards discharging the sums secured by the security or payable under the hire-purchase agreement, chattels leasing agreement or retention of title agreement and where the net proceeds of the disposal are less than the sums secured by the security or payable under any of those agreements, the holder of the security or the owner of the goods, as the case may be, may prove on a winding up for any balance due to him.
(6) Where a condition imposed in pursuance of subsection (5) relates to two or more securities, that condition shall require the net proceeds of the disposal to be applied towards discharging the sums secured by those securities in the order of their priorities.
(7) (a) A copy of an order made under subsection (2) shall, within 14 days after the making of the order, be sent by the judicial manager to the Registrar.
(b) The judicial manager shall give 7 days’ notice of his application to the Court to dispose of property subject to a security under subsection (2) to the holder of the security or to the owner of the goods which are subject to the hire-purchase agreement, chattels leasing agreement or retention of title agreement and the holder or the owner, as the case may be, may oppose the disposal of the property.
(8) A judicial manager who, without reasonable excuse, fails to comply with subsection (7), is guilty of an offence and liable on conviction to a fine not exceeding $5,000, and, in the case of a continuing offence, with a further fine not exceeding $250 for every day or part thereof during which the offence continues after conviction.

Insolvency 54
(9) Nothing in this section shall be regarded as prejudicing an application to the Court under section 49.

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s 39Power to deal with charged property etc.

(1)

The judicial manager of a company may dispose of or otherwise exercise his powers in relation to any property of the company which is subject to a security to which this subsection applies as if the property were not subject to the security.

(2)

Where, on application by the judicial manager of a company, the

Court is satisfied that the disposal (with or without other assets) —

(a)

of any property of the company subject to a security to which this subsection applies; or

(b)

of any goods under a hire-purchase agreement, chattels leasing agreement or retention of title agreement, would be likely to promote one or more of the purposes specified in the judicial management order, the Court may by order authorise the judicial manager to dispose of the property as if it were not subject to the security or to dispose of the goods as if all rights of the owner under the hire-purchase

Insolvency agreement, chattels leasing agreement or retention of title agreement were vested in the company.

(3)

Subsection (1) applies to any security which, as created, was a floating charge and subsection (2) applies to any other security.

(4)

Where any property is disposed of under subsection (1), the holder of the security shall have the same priority in respect of any property of the company directly or indirectly representing the property disposed of as he would have had in respect of the property subject to the security.

(5)

It shall be a condition of an order made under subsection (2) that the net proceeds of the disposal shall be applied towards discharging the sums secured by the security or payable under the hire-purchase agreement, chattels leasing agreement or retention of title agreement and where the net proceeds of the disposal are less than the sums secured by the security or payable under any of those agreements, the holder of the security or the owner of the goods, as the case may be, may prove on a winding up for any balance due to him.

(6)

Where a condition imposed in pursuance of subsection (5) relates to two or more securities, that condition shall require the net proceeds of the disposal to be applied towards discharging the sums secured by those securities in the order of their priorities.

(7)

(a)

A copy of an order made under subsection (2) shall, within 14 days after the making of the order, be sent by the judicial manager to the Registrar.

(b)

The judicial manager shall give 7 days’ notice of his application to the Court to dispose of property subject to a security under subsection (2) to the holder of the security or to the owner of the goods which are subject to the hire-purchase agreement, chattels leasing agreement or retention of title agreement and the holder or the owner, as the case may be, may oppose the disposal of the property.

(8)

A judicial manager who, without reasonable excuse, fails to comply with subsection (7), is guilty of an offence and liable on conviction to a fine not exceeding $5,000, and, in the case of a continuing offence, with a further fine not exceeding $250 for every day or part thereof during which the offence continues after conviction.

Insolvency 54

(9)

Nothing in this section shall be regarded as prejudicing an application to the Court under section 49.