Assignees Cannot Use Section 212 "Shortcut"

Assignee's claims for breach of duty brought by insolvency act application under Section 212 IA 1986 should have been brought by Part 7 Claim Form.

Section 246 ZD Insolvency Act 1986 enables the assignment of “transaction avoidance” office holder claims.

Where transaction avoidance claims are available to an office holder, there often also exists breach of duty claims arising from the same facts. Such claims are assets of the company which existed prior to liquidation.

Where both office holder claims and company claims have been assigned to a third party, it has been common practice for assignees to advance all claims within one Insolvency Act application notice.

In Manolete Partners Plc v Hayward and Barrett Holdings Ltd  the respondents challenged the applicant's ability to bring company claims for breach of duty via Section 212 IA 1986.