Costs Order in Family Proceedings Provable in Bankruptcy

Levy v Legal Aid Board (Ch D NLJ 11 February)

Rule 12.3(2)(a) of the Insolvency Rules 1986 provides that ‘Any fine imposed for an offence, and any obligation arising under an order made in family proceedings or under a maintenance assessment made under the Child Support Act 1991’ are not provable debts in bankruptcy. The husband was ordered to pay his wife’s costs of ancillary relief proceedings. The wife was legally aided and the Legal Aid Board had the costs taxed (assessed) and served a statutory demand for their recovery. The husband applied to have the demand set aside arguing that it was made with a view to it forming the basis of a petition for a bankruptcy order and accordingly had no tangible purpose because of the provisions of rule 12.3(2)(a).