What are the specific provisions of the Insolvency Act 2006 that override the Set-Off Act 1729-35

John Creser made this Official Information request to Minister of Commerce

Response to this request is long overdue. By law Minister of Commerce should have responded by now (details and exceptions). The requester can complain to the Ombudsman.

From: John Creser

Dear Minister of Commerce,

You stated on 8 August 2013 that "while the Set-Off Act 1735 does still apply in New Zealand the specific provisions in the Insolvency Act 1967 override the Set-off Act and that the Official Assignee does not need to consider the provisions of the Set-Off Act."

Please inform me of the specific provisions/sections you refer to in the Insolvency Act 1967 that override the acts Set-Off Act 1729-1735, allowing the Official Assignee to ignore the statute of set off.

Yours faithfully,

John Creser

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Ministry of Economic Development lawyer Grant Slevin, today rejected requests for further information about the policies adopted by the Official Assignee to allow the executor of a deceased estate to take bankruptcy proceedings against her own estate.

The Ministry had been asked to confirm its practice and policy this week, after the executrix of a mutual estate was allowed to bankrupt a beneficiary to whom she owed a greater amount.

Last week, Minister for Commerce, the Hon Craig Foss was forced to backtrack on answers to questions concerning the operation of the the Insolvent Debtors Relief Act 1729 (Set-Off Act).

Mr Foss initially confirmed the statute of set-off is still in force in New Zealand and that the OA could not override it, but later he added; "You will note from the answers above that while the Set-off Act 1735 does still apply in New Zealand the specific provisions in the Insolvency Act 1967 override the Set-off Act. Accordingly, l am advised that the Official Assignee did not need to consider the provisions of the Set-Off Act"

The questions have been put to Mr Foss to promote codification of the law to include the acts of set-off into current legislation. Its apparent from the case cited that the OA appears to have completely overlooked the statute of set-off which specifically mandates that debts between parties to a mutual estate are not actionable.

Another query concerned the ability of executors to take court proceedings before gaining title to the estate. An application for probate results in legal title to the property, but in the case cited, the OA allowed the executor to apply for probate after succeeding in a bankruptcy action, ignoring well established legal precedents guiding estate and probate practice.

Yesterday the Insolvency service was asked on fyi.org.nz whether or not the OA considered the executor of a deceased estate to have the standing to take and conclude Court proceedings in bankruptcy, before obtaining probate?

A further question asked if the trustees/executors of deceased estates under administration were liable or indemnified for their costs if they were the losing parties in hostile actions against the estate?

Today the OA's lawyer Grant Slevin, answered both questions by refusing the request " under s 18(e) Official Information Act 1982 because the information does not exist and under s 18(h) because the request is frivolous or vexatious."

A petition to Parliament is now being circulated to remedy the current practice of the Insolvency Service, which according to several prominent trust experts, ignores a lawful statute and inexcusably disregards every relevant equitable precedent to gain control of an estate.

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