Trustee in bankruptcy's application for sale of the family home after one year (IA 1986 s.335A)
Gareth and Lowri, a married couple, own their family home in Swindon, England, as beneficial joint tenants. Gareth was made bankrupt, and his estate vested in his trustee in bankruptcy in January 2025. In August 2026 the trustee applied under s.14 of the Trusts of Land and Appointment of Trustees Act 1996 for an order for sale. Lowri, who was not responsible for the bankruptcy, lives in the house with their two children, aged 13 and 15. A sale would cause the family the disruption and hardship that a sale usually causes, but there is nothing unusual about their circumstances.
Which of the following best describes how the court will approach the application?
Choose one answer to see the reasoning.
Worked answer
Correct answer C: The court will assume, unless the circumstances are exceptional, that the creditors' interests outweigh all other considerations.
THE RULE TO REMEMBER
On a bankrupt's trustee's application for sale made more than a year after vesting, the court assumes creditors' interests outweigh all others unless the circumstances are exceptional.
Trustee in bankruptcy's application for sale of the family home after one year (IA 1986 s.335A)
Section 15(4) of the 1996 Act provides that s.15 does not apply where s.335A of the Insolvency Act 1986 applies, which it does to an application by a trustee of a bankrupt's estate. Under s.335A(2) the court makes such order as is just and reasonable having regard to the creditors' interests, the conduct, needs and resources of the spouse or civil partner and the needs of any children, and all the circumstances other than the bankrupt's needs. But s.335A(3) provides that where the application is made after the end of one year from the first vesting of the bankrupt's estate in a trustee, the court shall assume, unless the circumstances are exceptional, that the creditors' interests outweigh all other considerations. The estate vested in January 2025 and the application was made in August 2026, more than a year later. The family's hardship is the usual consequence of a sale and not exceptional, so a sale is very likely to be ordered.
Why A is wrong: Section 15(4) disapplies s.15 where s.335A applies, as it does to a trustee in bankruptcy's application.
Why B is wrong: The court may order a sale on the trustee's application without the co-owner's consent.
Why D is wrong: There is no rule postponing sale until children reach 18; their needs are relevant only within s.335A.
Why E is wrong: Section 335A contains no automatic one-year adjournment; the one-year period runs from vesting and triggers the presumption in favour of creditors.
A little more practice done.
Related questions
Order for sale between co-owners: TOLATA 1996 ss.14 and 15 factors
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Severance by written notice, then survivorship (LPA 1925 ss.36(2), 196(3))
Which of the following best describes who now holds the legal title and the beneficial interests in the house?
A GOOD HABIT, DELIVERED
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