The High Court has ruled that an application under section 115A of the Personal Insolvency Act is made when it is lodged in the relevant court office. Service on creditors and other notice parties does not have to be completed within the statutory 14-day period after a creditors’ meeting.
Mr Justice Denis McDonald delivered the judgment on 11 February 2019 in an appeal concerning Thomas Finnegan, a debtor. His personal insolvency practitioner had appealed a Circuit Court decision dismissing an application to have proposed personal insolvency arrangement terms approved despite creditors’ rejection.
At a creditors’ meeting on 6 December 2016, creditors holding 60.7% of the debt present and voting supported the proposal. Mars Capital Ireland No. 2 DAC, which held 39.3% of that debt, opposed it. Among unsecured creditors, support amounted to 49.9%, while Mars held 50.1%. The required approval threshold was therefore not met, and the practitioner sought relief under section 115A.
The application was issued in the Circuit Court office in Trim, County Meath, on 19 December 2016, within 14 days of the meeting. Notice was posted to creditors on 21 December, outside that period. The Circuit Court concluded that the application was not “made” until all required parties had been served and dismissed it as out of time. The practitioner appealed that decision.
Mars argued that service within the deadline was necessary, pointing to the impact an application can have on creditors’ rights and the continuation of protections against enforcement action. The practitioner argued that the deadline applied to lodging the application, with notice as a separate requirement.
The High Court examined the wording and structure of section 115A alongside the wider statutory scheme. It distinguished the provision from legislation considered in earlier cases that expressly required an application to be made “by motion on notice.” The judge concluded that section 115A did not make service an integral part of making the application. The related rules required service within four days after issue, supporting the distinction between the deadline for making the application and the separate obligation to notify the parties.
The court held that the application was made once lodged in the relevant court office and that section 115A(2) did not require service within the 14-day period. The judgment resolved that interpretive issue in the appeal. The supplied extract does not include a further order determining the underlying personal insolvency arrangement application.