Report No. 26
69. Power for court to make vesting order in respect of disclaimed property.-(1) The court may, on the application of any person claiming either any interest in any disclaimed property or under any liability not discharged by this Act in respect of any disclaimed property, and on hearing such persons as it thinks fit, make an order for the vesting of the property in or delivery thereof to any person entitled thereto, or to whom it may seem just that the same should be delivered by way of compensation for such liability as aforesaid, or a trustee for him, and on such terms as the court thinks just; and on any such vesting order being made, the property comprised therein shall vest accordingly in the person therein named in that behalf without any transfer for the purpose:
(a) where the property disclaimed is of a leasehold nature, the court shall not make a vesting order in favour of any person claiming under the insolvent, whether as sub-lessee or as mortgagee, except upon the terms of making such person subject to the same liabilities and obligations as the insolvent was subject to under the lease in respect of the property at the date when the insolvency petition was filed; and
(b) any sub-lessee or mortgagee failing to apply for or declining to accept a vesting order upon such terms shall be excluded from all interest in and security upon the property; and
(c) if there is no person claiming under the insolvent who has applied for and is willing to accept an order upon such terms, the court shall have power to vest the insolvent's interest in the property in any person liable either personally or in a representative character, and either alone or jointly with the insolvent, to perform the lessee's covenants in such lease, freed and discharged from all estates, encumbrances and interests created therein by the insolvent.
(2) The court may, if it thinks fit, modify the terms prescribed by the proviso to sub-section (1) so as to make a person in whose behalf the vesting order may be made subject only to the same liabilities and obligations as if the lease had been assigned to him at the date when the insolvency petition was filed, and (if the case so requires) as if the lease had comprised only the property comprised in the vesting order.
[New] [Cf. section 66, P.T.A.]