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Debtdummy
Junior Member
United Kingdom
267 Posts |
 Posted - 23 March 2007 : 17:34:14
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Part 5 - IPAs VARIATION OF INCOME PAYMENTS AGREEMENT
December 2006
31.7.52 IPA Variation - Notice to bankrupt of application for variation
An IPA may be varied by written agreement between the parties [note 1]. The application to vary the IPA does not have to be made before the discharge from bankruptcy, but it may assist in recovering arrears if any variation is progressed as soon as possible (see Part 4, IPA Default). Variation of the agreement only modifies the IPA, it does not convert it in to an IPO.
However, in the event that one of the parties to the agreement wishes to vary it but the other party does not consent to the variation, application may be made to court for the IPA to be varied. Such an application may be made by the bankrupt, trustee or official receiver. The most likely circumstance where an application for the IPA to be varied will be required, is where the individual subject to the IPA has defaulted in making payments without due cause. See Part 4, IPA Default.
Another circumstance which may require the official receiver/trustee to make an application to court to vary the IPA would be where the bankrupt who is subject to an IPA is in receipt of a payment such as a pension lump sum (either before or after discharge) which can be held to be within the definition of income and can be recovered under an IPA/IPO (see also paragraph 31.7.11). The bankrupt's monthly income may change as a result of receiving his/her pension (as opposed to remaining in employment) and the official receiver/trustee should consider this when seeking to vary the amount to be claimed under the IPA. To ensure that creditors receive the full anticipated amount under the original agreement it may be necessary to adjust the bankrupt's payments , which could include making a one off payment from the lump sum to cover the amount still outstanding within the term of the original agreement and then vary to nil the amount of contribution for the months remaining within the IPA .
Where application is made to the court, it must be accompanied by a copy of the original agreement (form IPA). Where the bankrupt applies to the court for variation of the IPA, he must send to the official receiver or trustee, whichever is appropriate, a copy of the application and notice of the venue at least 28 days before the date fixed for the hearing.
Where the official receiver or trustee applies to the court for variation of the IPA, he must send a copy of the application (form IPORAV) and notice of the venue to the bankrupt (form IPANVA) at least 28 days [note 2] before the date fixed for the hearing.
The court may order a variation of the IPA in Form 6.81.
Where the court orders that the IPA be varied so that it takes the form of an agreement that a third party is to make the payments under the IPA to the trustee or official receiver, the trustee or official receiver must then send notice of the agreement to the third party. [note 3](See also paragraph 31.7.49).
When making any such payment, the third party may deduct the appropriate fee towards the clerical and administrative costs of complying with the IPA but must notify the bankrupt in writing of the amount deducted.
[Back to Part 4] [On to Part 6]
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IPAs VARIATION OF INCOME PAYMENTS AGREEMENT-PART 5
