In force2020 Revised Edition

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Insolvency, Restructuring and Dissolution Act 2018 · 2020 Revised Edition · Part 9 · Provisions Applicable in Judicial Management and Winding Up

219. Mutual credit and set-off

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(1)

This section applies to —

(a)

a company in judicial management; and

(b)

an insolvent company that is being wound up.

(2)

Where there have been any mutual credits, mutual debts or other mutual dealings between a company and any creditor, the debts and liabilities to which each party is or may become subject as a result of such mutual credits, debts or dealings must be set off against each other and only the balance is a debt provable in the judicial management or the winding up of the company, as the case may be.

(3)

There is to be excluded from any set‑off under subsection (2) any debt or liability of the company which —

(a)

is not a debt provable in judicial management or winding up; or

(b)

arises by reason of an obligation incurred at a time when the creditor had notice that an interim judicial manager had been appointed under section 94(3), or that the application for a judicial management order or the application for winding up (as the case may be) relating to the company was pending.

(4)

A sum is to be regarded as being due to or from the company for the purposes of subsection (2) regardless of whether —

(a)

the sum is payable at present or in the future;

(b)

the obligation by virtue of which the sum is payable is certain or contingent; or

(c)

the sum is fixed or liquidated, or is capable of being ascertained by fixed rules or as a matter of opinion.