www.iva.co.uk

I am on the committee of the operatic society I belong to. The committee is applying to become a charitable trust and I we have been told that all members of the committee have to be on the board of trustee and that if you are not a trustee you cannot be on the committee. My question is how does that sit with me being in an IVA. If I can't be a trustee I will have to stand down from the committee.

Hi
From the Charity Commission

Disqualified - Can anyone be a trustee?
Generally speaking anyone who is 18 years or over can be a trustee. However, certain people are legally disqualified from continuing to be, or from becoming a trustee. Obviously this will only effect a small minority of people. People who are disqualified are those who

have been convicted at any time of any offence involving deception or dishonesty, unless the conviction is legally regarded as spent; or
are undischarged bankrupts; or
have made compositions or arrangements with their creditors from which they have not been discharged; or
have at any time been removed by the Commissioners or by the court in England, Wales (or by the Court of Sessions in Scotland) from being a trustee because of misconduct; or
are disqualified from being company directors; or
are subject to an order made under s. 429(2) (b) of the Insolvency Act 1986.

I think that you will not be able to be a trustee until your IVA has completed
Regards

That is correct - an IVA is a composition with creditors, and therefore under the ruling quoted by Andy above, you will not be able to act as a Trustee of a registered charity.

Could you be a trustee with the permission of the court?

Still can't answer the question but I did find that
It appears that in bankruptcy you can be a company director with the permission of the court but not the trustee of a charity as it is a public office.

http://www.insolvency.gov.uk/pdfs/guida ... ruptcy.pdf

It doesn't seem at all fair. I note it mentions Trust Deeds and other arrangements - surely that would include dmps?

Would the Enterprise Act have modified the law? No because it is a disqualification under section 72(4) of the Charities Act 1993 and doesn't seem to give any discretion to the court.

It includes any form of compromise with creditors - so this would include a DMP.

Ok thanks for that - I thought as much.

Well I certainly didn't.
An insolvent person can be a company director in an IVA (and potentially in bky too), running a business for their own benefit and with duties to shareholders etc I don't have a problem with that at all, everyone needs to earn a crust.

But the trustee of a donkey sanctuary, working for the benefit of ummmm donkeys (!) would be disqualified for negotiating a lower payment on their personal debts. (And faces 6 month in prison if they carry on).

So, another public office is school governor. I "know" you can't be bankrupt and a school governor, so what about IVAs?

Thats my job for today (after a bucket of coffee and a run*)





*[:D] I can manage 22 yards.

Hi All

This info has changed things for me, I was of the opinion I could continue with some of my involvements. I think not now. I am aslo of the view that you can be a school governor and in an IVA, however what if the school is a trust school with charitable status?



Thanks


John

Holding a public office is considered differently than being a director of a company. I think that is why anyone who has not been discharged from bankruptcy or has compromised with his/her crediors is not able to be a Trustee of any charitable organisation.

The insolvency service state you can be a charity trustee in bankruptcy with the leave of the court but the Charities Act forbids it!



http://www.insolvency.gov.uk/freedomofi ... /part3.htm



4.80 Trustee of a charity – relevant charity

An undischarged bankrupt cannot act as a trustee of a charity without leave of the court. Where a bankrupt holds such an office, he should be informed that he must either cease to act or make application to the court. Notification of the bankruptcy should be sent to the relevant charity [note 20].

Worse still some school governor application forms state you can't be a governor if you have made a composition with your creditors.
Others don't but state you can't be a governor if you have been disqualified as a charity trustee - suggesting you can be a school governor if you are in an IVA as long as you aren't also a charity trustee!

Hi All

I have resigned this week from two bodies I was a director with. This is because it says in teir articles of association that you are not allowed to be a director/trustee if you have made a composition with your creditors or are BR etc. I also checked with Governorline and they said i can continue as a school governor in an IVA but not if BR.

The next test is the school I am on is a Trust school and am trying to find out if I can stay on the trust board part of our structure, I think I may lose that one too.

I have lost more than I thought I would in the IVA, have started to wonder if I may as well have gone BR as we would not have 6 years ahead of us.


Thanks


A depressed John[xx(]

Hi
It is rather sad that you have had to give up these positions, the rules seem outdated and very unfair.
I feel that anybody dealing with their debts via an IVA should be given credit [excuse the pun] for their actions
Regards

How sad that such public spirited people are subject to such prejudice over their financial affairs, with absolutely no thought for the very good services they provide on a voluntary basis.

It is sad and based on archaic rules and prejudices.