Ian Wilson KC and Ryan Ferro act for successful claimants in important insolvency bond decision

On 24 March 2026, HHJ Rawlings handed down judgment in Nicholson & Anor v Insolvency Practitioners Association & Ors [2026] EWHC 686 (Ch), an important decision concerning insolvency practitioner bonds (“IP bonds”).

All insolvency practitioners are required by statute to maintain IP bonds as security for the proper performance of their functions, including protection against fraud or dishonesty. The decision is therefore of significance across the insolvency profession.

The case raised complex issues spanning insolvency law, trusts law and public law, including:

• whether an IP’s professional body (in this case the Insolvency Practitioners Association (“IPA”)) performs a public function when exercising rights under IP bonds;
• whether rights under IP bonds are held on trust for insolvent estates; and
• whether the Court can order the transfer of such rights as intangible property under s.234(2) of the Insolvency Act 1986 (“IA 1986”).

The claimants were appointed as successor office-holders to three insolvent companies and alleged that the original office-holders had dishonestly overcharged the estates. They sought to pursue claims under IP bonds issued by Intact (as surety) to the IPA (as named beneficiary). The IPA declined to bring claims or assign its rights under the bonds, resulting in proceedings.

The Court found in favour of the claimants on each issue, holding that:

• the IPA holds rights under IP bonds on bare trust for the relevant insolvent estates;
• the IPA’s role in relation to IP bonds is not a public function, such that its decisions are not amenable to judicial review; and
• the Court has jurisdiction under s.234(2) IA 1986 to order the transfer of rights under IP bonds to insolvency office-holders.

The judgment provides important clarification as to the legal status of IP bonds and the ability of office-holders to obtain the benefit of those rights where necessary to perform their functions.

Ian Wilson KC and Ryan Ferro (with Ben Strong KC), instructed by Mark Wilson, Fiona Emms and John Lamb of Gateley Legal plc, acted for the successful claimants.

Read the full judgment here.