Chapter 12:23 - Deeds of Arrangement

Link to law: http://legalaffairs.gov.gy/information/laws-of-guyana/493-chapter-1223-deeds-of-arrangement/file

LAWS OF GUYANA
DEEDS OF ARRANGEMENT ACT
CHAPTER 12:23
Act
16 of 1916
1 – 17 ... 1/2012 (inclusive) by L.R.O.
Pages Authorised
Current Authorised Pages
L.R.O. 1/2012
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2 Cap. 12:23 Deeds of Arrangement
Note
on
Subsidiary Legislation
This Chapter contains no subsidiary legislation.
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CHAPTER 12:23
DEEDS OF ARRANGEMENT ACT
ARRANGEMENT OF SECTIONS
SECTION
1. Short title.
2. Interpretation.
PART I
APPLICATION OF ACT
3. Deeds of arrangement to which Act applies.
PART II
AVOIDANCE OF DEEDS OF ARRANGEMENT WHERE STATUTORY
CONDITIONS ARE NOT OBSERVED
4. Avoidance of unregistered deeds of arrangement.
5. Avoidance of deeds arrangement unless assented by a majority of
the creditors
PART III
REGISTRATION OF DEEDS OF ARRANGEMENT
6. Registrar and place for registration.
7. Mode of registration.
8. Form of register.
9. Rectification of register.
10. Time for registration.
11. Inspection of register and registered deeds.
PART IV
PROVISIONS AS TO TRUSTEES SECTION
12. Security by trustee.
13. Trustee acting when deed of arrangement void.
14. Transmission of accounts to Registrar.
15. Transmission of accounts to creditors
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SECTION
16. Audit of accounts.
17. Payment of undistributed moneys into court.
18. Preferential payment to creditor an offence.
19. Protection of trustees under void deeds.
20. Notice to creditors of avoidance of deed.
21. Payment of expenses incurred by trustees.
22. Application of Part IV.
PART V
GENERAL
23. Courts in which application for enforcement of trusts to be made.
24. Relative to insolvency laws.
25. Office copies.
26. Fees.
27. Rules.
__________________________
1929 Ed.
c. 181
1953 Ed.
c. 45 _______________________________________________________
16 of 1916 An Act relating to Deeds of Arrangement.
[1st JANUARY, 1917]
Short title.
Interpretation.
c. 12:21

1. This Act may be cited as the Deeds of Arrangement
Act.
2. (1) In this Act—
“creditors generally” includes all creditors who assent to, or
take the benefit of, a deed of arrangement;
“property” has the same meaning as in the Insolvency Act, or
under any other Act relating to insolvency.
(2) For the purpose of determining the number of
CHAPTER 12:23
DEEDS OF ARRANGEMENT ACT
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Deeds of
arrangement to
which Act
applies.

creditors for whose benefit a deed is made, any two or more
joint creditors shall be treated as a single creditor.
PART I
APPLICATION OF ACT
3. (1) A deed of arrangement to which this Act applies
includes any instrument of the classes hereinafter mentioned,
whether under seal or not—
(a) made by, for, or in respect of, the
affairs of a debtor for the benefit of his
creditors generally;
(b) made by, for, or in respect of the
affairs of a debtor who was insolvent
at the date of the execution of the
instrument for the benefit of any three
or more of his creditors,
otherwise than in pursuance of the law for the time being in
force relating to insolvency.
(2) The classes of instrument hereinbefore referred
to are—
(a) an assignment of property;
(b) a deed of or agreement for a
composition,
and, in cases where creditors of the debtor obtain any control
over his property or business—
(c) a deed of inspectorship entered into
for the purpose of carrying on or
winding up a business;
(d) a letter of licence authorising the
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Avoidance of
unregistered
deeds of
arrangement.
Avoidance of
deeds of
arrangement
unless assented
to by a majority
of the creditors.

debtor, or any other person to
manage, carry on, realise, or dispose
of the business with a view to the
payment of debts; and
(e) any agreement or instrument entered
into for the purpose of carrying on or
winding up the debtor’s business, or
authorising the debtor or any other
person to manage, carry on, realise, or
dispose of it, with a view to the
payment of his debts.
PART II
AVOIDANCE OF DEEDS OF ARRANGEMENT WHERE
STATUTORY CONDITIONS ARE NOT OBSERVED
4. A deed of arrangement shall be void unless it is
registered with the Registrar of bills of sale (hereinafter called
the Registrar) under this Act within seven clear days after the
first execution thereof by the debtor or any creditor, or, if it is
executed in any place out of Guyana, then within seven clear
days after the time at which it would, in the ordinary course
of post, arrive in Guyana, if posted within one week after the
execution thereof, and unless it bears the ordinary and ad
valorem stamp prescribed by this Act.
5. (1) A deed of arrangement either expressed to be or
in fact for the benefit of a debtor’s creditors generally shall be
void unless, before or within twenty-one days after its
registration, or within any extended time the High Court
(hereinafter called the Court) allows, it has received the assent
of a majority in number and value of the creditors of the
debtor.
(2) The list of creditors annexed to the affidavit of
the debtor filed on the registration of the deed shall be prima
facie evidence of the names of the creditors and the amounts
of their claims.
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Registrar and
place for
registration.
Mode of
registration.
(3) The assent of a creditor for the purposes of
subsection (l) shall be established by his executing the deed or
sending to the trustee his assent in writing attested by a
witness, but not otherwise.
(4) The trustee shall file with the Registrar at the
time of the registration of a deed of arrangement, or, in the
case of a deed of arrangement assented to after registration,
within twenty-eight days after registration or within any
extended time the Court allows, a statutory declaration by the
trustee that the requisite majority of the creditors of the
debtor have assented to the deed, which declaration shall, in
favour of a purchaser for value, be conclusive evidence, and,
in other cases, be prima facie evidence, of the fact declared.
(5) In calculating a majority of creditors for the
purposes of this section, a creditor holding security upon the
property of the debtor shall be reckoned as a creditor only in
respect of the balance (if any) due to him after deducting the
value of that security, and creditors whose debts amount to
sums not exceeding forty-eight dollars shall be reckoned in
the majority in the value but not in the majority in number.
PART III
REGISTRATION OF DEEDS OF ARRANGEMENT
6. The Registrar of Deeds shall be the Registrar of
deeds of arrangement for the purposes of this Act, and the
deeds registry shall be the place for their registration.
7. (1) The registration of a deed of arrangement under
this Act shall be effected in the following manner:
a true copy of the deed, and of every schedule or
inventory thereto annexed, or therein mentioned, shall be
presented to and filed with the Registrar within seven
clear days after the execution of the deed (in like manner
as a bill of sale given by way of security for the payment
of money is required to be filed), together with an
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Form of
register.
affidavit verifying the time of execution and containing a
description of the residence and occupation of the debtor,
and of the place or places where his business is carried
on, and an affidavit by him stating the total estimated
amount of property and liabilities included under the
deed, the total amount of the composition (if any)
payable thereunder, and the names and addresses of his
creditors.
(2) No deed shall be registered under this Act
unless the original of the deed, duly stamped with the proper
inland revenue duty, and in addition to that duty a stamp
denoting a duty computed at the rate of twenty-five cents for
every five hundred dollars or fraction of five hundred dollars
of the sworn value of the property passing, or (where no
property passes under the deed) the amount of composition
payable under the deed, is produced to the Registrar at the
time of the registration.
8. The Registrar shall keep a register wherein shall be
entered, as soon as conveniently may be after the presentation
of a deed for registration, an abstract of the contents of every
deed of arrangement registered under this Act containing the
following and any other prescribed particulars:
(a) the date of the deed;
(b) the name, address, and description of
the debtor, and the place or places
where his business was carried on at
the date of the execution of the deed,
and the title of the firm or firms under
which the debtor carried on business,
and the name and address of the
trustee (if any) under the deed;
(c) a short statement of the nature and
effect of the deed; and of the
composition in the dollar payable
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Rectification of
register.


Time for
registration.

Inspection of
register and
registered
deeds.
[6 of 1997]
thereunder;
(d) the date of registration;
(e) the amount of property and liabilities
included under the deed, as estimated
by the debtor.
9. The Court, or a judge thereof, upon being satisfied
that the omission to register a deed of arrangement within the
time required by this Act, or that the omission or
misstatement of the name, residence, or description of any
person, was accidental or due to inadvertence, or to some
cause beyond the control of the debtor and not imputable to
any negligence on his part, may, on the application of any
party interested, and on any just and expedient terms and
conditions, extend the time for registration, or order the
omission or misstatement to be supplied or rectified by the
insertion in the register of the true name, residence, or
description.
10. Where the time for registering a deed of
arrangement expires on a public holiday, or other day on
which the Deeds Registry is closed, the registration shall be
valid if made on the next following day on which that registry
is open.
11. Anyone shall be entitled, at all reasonable times, to
search the register on payment of sixty-five dollars, or any
other prescribed fee, and subject to the prescribed regulations,
and shall be entitled at all reasonable times to inspect,
examine, and make extracts from any registered deed of
arrangement, without being required to make a written
application or to specify any particulars in reference thereto,
upon payment of sixty-five dollars, or any other prescribed
fee, for each deed of arrangement inspected:
Provided that the extracts shall be limited to the dates of
execution and of registration, the names, addresses, and
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Security by
trustee.

descriptions of the debtor and of the parties to the deed, a
short statement of the nature and effect of the deed, and any
other prescribed particulars.
PART IV
PROVISIONS AS TO TRUSTEES
12. (1) The trustee under a deed of arrangement shall,
within seven days from the date on which the statutory
declaration certifying the assent of the creditors is filed, give
security in the prescribed manner to the Registrar, in a sum
equal to the estimated assets available for distribution
amongst the unsecured creditors as shown by the affidavit
filed on registration, to administer the deed properly and
account fully for the assets which come to his hands, unless a
majority in number and value of the debtor’s creditors, either
by resolution passed at a meeting convened by notice to all
the creditors, or by writing addressed to the trustee, dispense
with his giving that security:
Provided that, when that dispensation has been so given,
the trustee shall forthwith make and file with the Registrar a
statutory declaration to that effect, which declaration shall, in
favour of a purchaser for value, be conclusive evidence, and,
in other cases, be prima facie evidence, of the facts declared.
(2) If a trustee under a deed of arrangement fails to
comply with the requirements of this section, the Court, on
the application of any creditor and after hearing any persons
it thinks fit, may declare the deed of arrangement to be void,
or make an order appointing another trustee in the place of
the trustee appointed by the deed.
(3) A certificate that the security required by this
section has been given by a trustee, signed by the Registrar to
whom it was given and filed with the Registrar, shall be
conclusive evidence of the fact.
(4) All moneys received by a trustee under a deed
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Trustee acting
when deed of
arrangement
void.
[6 of 1997]

Transmission of
accounts to
Registrar.
[6 of 1997]
of arrangement shall be banked by him to an account to be
opened in the name of the debtor’s estate.
(5) In calculating a majority of creditors for the
purposes of this section, a creditor holding security upon the
property of the debtor shall be reckoned as a creditor only in
respect of the balance (if any) due to him after deducting the
value of that security, and creditors whose debts amount to
sums not exceeding fifty dollars shall be reckoned in the
majority in value but not in the majority in number.
13. If a trustee acts under a deed of arrangement—
(a) after it has to his knowledge become
void by reason of non-compliance
with any of the requirements of this
Act, or
(b) after he has failed to give security
within the time and in the manner
provided for by this Act or any
enactment repealed by this Act,
he shall be liable on summary conviction to a fine of four
thousand eight hundred and seventy-five dollars for every
day between the date on which the deed became void or the
expiration of the time within which security should have been
given, as the case may be, and the last day on which he is
proved to have acted as trustee, unless he satisfies the court
before which he is accused that his contravention of the law
was due to inadvertence, or that his action has been confined
to taking steps necessary for the protection of the estate.
14. (1) Every trustee under a deed of arrangement
shall at the prescribed times, transmit to the Registrar an
account of his receipts and payments as trustee, in the
prescribed form and verified in the prescribed manner.
(2) If any trustee fails to transmit that account, he
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c. 12:21

Transmission of
accounts to
creditors.
c. 12:21

Audit of
accounts.
shall be liable on summary conviction to a fine of four
thousand eight hundred and seventy-five dollars for each day
during which the default continues, and the High Court on
the application of the Registrar may exercise all the powers
conferred on the Court by section 86(2) of the Insolvency Act.
(3) The accounts transmitted to the Registrar in
pursuance of this section shall be open to inspection by the
debtor or any creditor or other person interested on payment
of the prescribed fee, and copies of or extracts from the
accounts shall, on payment of the prescribed fee, be furnished
to the debtor, the creditors, or any other persons interested.
(4) In this section the expression “trustee” includes
any person appointed to distribute a composition or to act in
any fiduciary capacity under any deed of arrangement, and
the expression “prescribed” means prescribed by rules under
the Insolvency Act, or under any other Act dealing with
insolvency.
15. Every trustee under a deed of arrangement shall,
at the expiration of six months from the date of the
registration of the deed, and thereafter at the expiration of
every subsequent period of six months until the estate has
been finally wound up, send to each creditor who has
assented to the deed a statement of the trustee’s accounts and
of the proceedings under the deed down to the date of the
statement, and shall, in his affidavit, verifying his accounts
transmitted to the Registrar state whether or not he has duly
sent that statement, and the dates on which the statements
were sent; and, if a trustee fails to comply with any of the
provisions of this section, the Court may, for the purpose of
enforcing these provisions, exercise on the application of the
Registrar all the powers conferred on the Court by section
86(2) of the Insolvency Act.
16. (1) Where in the course of the administration of the
estate of a debtor who has executed a deed of arrangement, or
within twelve months from the date when the final accounts
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c. 12:21
Payment of
undistributed
moneys into
court.
Preferential
payment to
creditor an
offence.
of the estate were rendered to the Registrar, an application in
writing is made to the Registrar by a majority in number and
value of the creditors who have assented to the deed for an
official audit of the trustee’s accounts, the Registrar may
cause the trustee’s accounts to be audited, and in that case all
the provisions of the Insolvency Act, or any other Act dealing
with insolvency relating to the institution and enforcement of
an audit of the accounts of a trustee in insolvency (including
the provisions as to fees) shall, with necessary modifications,
apply to the audit of the trustee’s accounts, and the Registrar
shall have power on the audit to require production of a
(2) The Registrar may determine how and by what
parties the costs, charges and expenses of and incidental to
the audit (including any prescribed fees chargeable in respect
thereof) are to be borne, whether by the applicants or by the
trustee or out of the estate, and may, before granting an
application for an audit, require the applicants to give
security for the costs of the audit.
17. At any time after the expiration of two years from
the date of the registration of a deed of arrangement, the
Court may on the application of the trustee or a creditor, or
on the application of the debtor, order that all moneys
representing unclaimed dividends, and undistributed funds
then in the hands of the trustee or under his control be paid
into court.
18. If a trustee under a deed of arrangement pays to
any creditor out of the debtor’s property a sum larger in
proportion to the creditor’s claim than that paid to other
creditors entitled to the benefit of the deed, then, unless the
deed authorises him to do so, or unless those payments are
either made to a secured creditor or to one entitled to enforce
his claim by distress, or are those which would be lawful in
certificate for the taxed costs of any attorney-at-law whose costs
no certificate is produced.
have been paid or charged by the trustee, and to disallow
the whole or any part of any costs in respect of which
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Protection of
trustees under
void deeds.


Notice to
creditors of
avoidance of
deed.
[6 of 1997]

Payment of
expenses
incurred by
trustees.

Application of
Part IV.
an insolvency, he shall be guilty of a misdemeanour.
19. Where a deed of arrangement is void because the
requisite majority of creditors have not assented thereto, or, in
the case of a deed for the benefit of three or more creditors,
because the debtor was insolvent at the time of the execution
of the deed and the deed was not registered as required by
this Act, but is not void for any other reason, and a receiving
order is made against the debtor upon a petition presented
after the lapse of three months from the execution of the deed,
the trustee under the deed shall not be liable to account to the
trustee in the insolvency for any dealings with or payments
made out of the debtor’s property which would have been
proper if the deed had been valid, if he proves that at the time
of those dealings or payments he did not know, and had no
reason to suspect, that the deed was void.
20. When a deed of arrangement is void by virtue of
this Act for any reason other than that, being for the benefit of
creditors generally, it has not been registered within the time
allowed for the purpose by this Act, the trustee shall, as soon
as practicable after he has become aware that the deed is void,
give notice in writing thereof to each creditor whose name
and address he knows, and file a copy of the notice with the
Registrar, and, if he fails to do so, he shall be liable on
summary conviction to a fine of nineteen thousand five
hundred dollars.
21. Where a deed of arrangement is avoided by reason
of the insolvency of the debtor, any expenses properly
incurred by the trustee under the deed in the performance of
any of the duties imposed on him by this Act shall be allowed
or paid him by the trustee in the insolvency as a first charge
on the estate.
22. The provisions of this Part, except those provisions
which—
(a) relate to the transmission of accounts
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Deeds of Arrangement Cap. 12:23 15
L.R.O. 1/2012

Courts in
which
application for
enforcement of
trusts to be
made.
Relative to
insolvency
laws.

to the Registrar;
(b) provide for the protection of trustees
under void deeds;
(c) require a notice to be given to
creditors of avoidance of deeds; and
(d) Provide for the payment of expenses
incurred by trustees,
shall not apply to a deed of arrangement made for the benefit
of any three or more of the debtor’s creditors unless it is in
fact for the benefit of the debtor’s creditors generally.
PART V
GENERAL
23. Any application by the trustee under a deed of
arrangement, either expressed to be or in fact for the benefit
of the debtor’s creditors generally, or by the debtor, or by any
creditor entitled to the benefit thereof, for the enforcement of
the trusts or the determination of questions under it, shall be
made to the Court:
Provided that any question as to whether any person
claiming to be a creditor entitled to the benefit of a deed of
arrangement is so entitled, may, subject to rules made under
this Act, be decided either by the court having such
jurisdiction as aforesaid or by the High Court.
24. (1) If the trustee under a deed of arrangement,
either expressed to be or in fact for the benefit of the debtor’s
creditors generally, serves in the prescribed manner on any
creditor of the debtor notice in writing of the execution of the
deed and of the filing of the statutory declaration certifying
the creditor’s assents, with an intimation that the creditor will
not, after the expiration of one month from the service of the
notice, be entitled to present an insolvency petition against
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Office copies.
Fees.

the debtor founded on the execution of the deed or on any
other act committed by him in the course or for the purpose
of the proceedings preliminary to the execution of the deed as
an act of insolvency, that creditor shall not, after the
expiration of that period, unless the deed becomes void, be
entitled to present an insolvency petition against the debtor
founded on the execution of the deed or any act so committed
by him as an act of insolvency.
(2) Where a deed of arrangement aforesaid has
become void by virtue of this Act, the fact that a creditor has
assented to the deed shall not disentitle him to present an
insolvency petition founded on the execution of the deed of
arrangement as an act of insolvency.
(3) Except as otherwise expressly provided by this
Act, nothing in this Act shall be construed as repealing or
shall affect any provision of the law for the time being in force
in relation to insolvency or shall give validity to any deed or
instrument which by law is an act of insolvency or void or
voidable.
25. Subject to this Act, anyone shall be entitled to have
an office copy of, or extract from, any deed registered under
this Act at the prescribed fees or charge, and any copy or
extract purporting to be an office copy or extract shall, in all
courts and before all arbitrators or other persons, be admitted
as prima facie evidence thereof, and of the fact and date of
registration as shown thereon.
26. There shall be taken, in respect of the registration
of deeds of arrangement, and in respect of any office copies or
extracts, or official searches made by the Registrar, the fees
from time to time prescribed by rules of court; and nothing in
this Act contained shall make it obligatory on the Registrar to
do, or permit to be done, any act in respect of which any fee is
specified or prescribed, except on payment of that fee.
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Rules.
c. 3:02
27. Rules for carrying this Act into effect may be made
in like manner as rules may be made under and for the
purposes of the High Court Act.
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