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Transaction Avoidance in Insolvencies$
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Rebecca Parry, James Ayliffe, Sharif Shivji, Hamish Anderson, and William Trower

Print publication date: 2018

Print ISBN-13: 9780198793403

Published to Oxford Scholarship Online: March 2021

DOI: 10.1093/oso/9780198793403.001.0001

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PRINTED FROM OXFORD SCHOLARSHIP ONLINE (oxford.universitypressscholarship.com). (c) Copyright Oxford University Press, 2021. All Rights Reserved. An individual user may print out a PDF of a single chapter of a monograph in OSO for personal use. date: 23 January 2022

Post-Petition Dispositions (Insolvency Act 1986, Sections 127 and 284)

Post-Petition Dispositions (Insolvency Act 1986, Sections 127 and 284)

Chapter:
(p.27) 3 Post-Petition Dispositions (Insolvency Act 1986, Sections 127 and 284)
Source:
Title Pages
Author(s):

Rebecca Parry

Sharif Shivji

Publisher:
Oxford University Press
DOI:10.1093/oso/9780198793403.003.0005

The timing of a transaction is fundamental to many of the avoidance provisions: none more so than sections 127 and 284, which operate in the period following, respectively, the presentation of a winding-up petition against a company and the presentation of a bankruptcy petition against an individual. These are times of great potential for detrimental transactions and the sections reflect this. Upon the debtor entering liquidation or bankruptcy, these sections retrospectively make any post-petition disposition automatically void regardless of whether it was a transaction that was of benefit to the debtor. Thus, beneficial transactions, such as payments to employees and sales of assets for full market value, are affected just the same as detrimental, asset-stripping, transactions. The simplicity, and harshness, of these provisions is therefore to be contrasted with most of the other avoidance provisions, which tend to be discretionary and often require some enquiry to be made regarding the debtor’s motivations.

Keywords:   bank accounts, default fund contributions, financing arrangements, floating charges, margin payments, market charges, market contracts, remedies, solvency and insolvency, state immunity, timing, transaction avoidance provisions, validation

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