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Jersey

The Bankruptcy (Désastre) (Jersey) Law, 1990 contains provisions on disqualifying directors of a company which has been declared 'en désastre' (bankrupt).

An application for a disqualification order is made by the Attorney-General to the Royal Court at some stage during the course of a désastre. There are no specified time limits as to when, during the administration of a désastre, such an application should be brought.

The Royal Court recently considered an application brought in respect of these provisions. In the matter of Jonathan Christopher Hamish Hay and Article 43 of the Bankruptcy (Désastre) (Jersey) Law, 1990 (June 10 1996) Jersey, unreported, the Royal Court distinguished an earlier authority which had provided that an application for disqualification should have been brought at the time of sentencing and should take effect from that time. The Royal Court held that the proper commencement date for a disqualification order under Article 43 of the Bankruptcy Law is the date on which the order is actually made. The Court also suggested that there might not, in the absence of any specific legislative provision to the contrary, be an objection to the Attorney-General deferring the making of such an application until the administration of a bankruptcy is nearing its conclusion.

In this case, the Court noted that the underlying purpose of the disqualification provisions is to protect the public. The Court imposed a disqualification order for the maximum possible period of five years and provided that it should not be back-dated, but should take effect from the date of the Court's order. The Court noted with approval an indication that the maximum statutory period of disqualification was being reviewed. Indeed, an amendment to the Bankruptcy Law has now been drafted which would have the effect of increasing the maximum period from five years to 15 years. This would bring Jersey law more closely into line with that obtaining in England under the UK Company Directors Disqualification Act of 1986.

Zillah J Howard

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