BusinessBusiness RecoveryEnterprise Bill to protect bankrupts’ homes

Enterprise Bill to protect bankrupts' homes

The government is to consider giving greater protection to the family home in future bankruptcy proceedings.

Trade Minister Melanie Johnson said she hoped to amend the Enterprise Bill to include a sunset provision which would give trustees in bankruptcy three years to exercise a claim against the property.

South Ribble Labour MP David Borrow, who proposed the change, said there was an increase in cases where homes were not reclaimed at the time of the bankruptcy because there was little or no equity value in them.

The occupiers had maintained mortgage payments only to find, in some cases many years later, that they were going to lose their homes.

Johnson said what was happening was ‘not entirely’ consistent with the insolvency reform principles in providing ‘A Fresh Start’ – as laid out in proposals for bankrupty reform – and there was a certain rough justice in practice.

Other changes agreed, before MPs concluded their line-by-line examination of the Bill, include powers for the government to extend insolvency law to foreign companies with assets and creditors in the UK and to industrial and provident societies.

But a Tory bid to give the Office of Fair Trading power to apply the proceeds of fines for anti-competitive practices to compensate victims was rejected by the government as were proposals to enable business found innocent of anti-competitive action to be paid costs.

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