Corporate Insolvency Flashcards
Who may bring para 75 misfeasance claim?
(a)the official receiver, (b)the administrator of the company, (c)the liquidator of the company, (d)a creditor of the company, or (e)a contributory of the company.
Court orders after para 75 misfeasance
(a)to repay, restore or account for money or property; (b)to pay interest; (c)to contribute a sum to the company’s property by way of compensation for breach of duty or misfeasance.
Who may bring para 74 challenge?
Creditor or member
Court order after para 74 claim
a)grant relief; (b)dismiss the application; (c)adjourn the hearing conditionally or unconditionally; (d)make an interim order; (e)make any other order it thinks appropriate. BUT NOT prevent: (i) CVA (ii) Scheme of arrangement (iii) cross border merger (iv) proposal/revision approved more than 28 days before application
Extension of administration by creditors
Only once for period not exceeding one year No extension after court extension Consent: each secured creditor and if no para 52(1)(b) unsecured creditors; or if para 52(1)(b) the preferential creditors but not the unsecured creditors generally
Admin to CVL under para 83 conditions
All amounts likely to be received by secured creditor received or set aside Distribution to unsecured creditors which is not a prescribed part distribution Notice to Registrar, court and creditors
Admin to dissolution under para 84
A’or thinks no property which might permit distribution to creditors Notice to registrar and also file at court and send to creditors 3 months after registration company is dissolved
How administrator resigns under para 87
(a)in the case of an administrator appointed by administration order, by notice in writing to the court, (b)in the case of an administrator appointed under paragraph 14, by notice in writing to the holder of the floating charge by virtue of which the appointment was made, (c)in the case of an administrator appointed under paragraph 22(1), by notice in writing to the company, or (d)in the case of an administrator appointed under paragraph 22(2), by notice in writing to the directors of the company.
Deadline for Ad’or to give notice of appointment
ASARP: - to company - publish in prescribed manner - creditors of whose claims and address he is aware of Within 7 days of notice of appointment/order to Companies House
Who must Ad’or proposals be sent to and by when?
Copy to: - court - creditors - members ASARP and within 8 weeks of appointment
Deadline for approving Ad’or proposal
Initial decision date within 10 weeks of appointment
When does Ad’or not need to seek approval of proposal?
- sufficient property to enable all creditors to be paid in full
- insufficient property to enable a distribution to unsecured creditors (except prescribed part)
- neither the para 3(1)(a) or 3(1)(b) purposes can be achieved
Grounds for compulsory liquidation in s. 122
- Special resolution
- incorporated as a plc and not been issued a trading certificate for 12 months
- old public limited company
- not commenced or suspended business for a whole year
- unable to pay its debts
- just and equitable
Inability to pay debts in s. 123
- statutory demand for £750 (liqudiated sum, no dispured on substantial grounds, not extinguished or reduced below £750 by genuine cross claim or set off
- Unsatisfied judgment execution
- Cash flow insolvency - court satisfied unable to pay debts as they fall due
- Balance sheet insolvency - court satisfied liabilities exceed assets taking into account contingent and prospective liabilities
Documents to be delivered to court for compulsory winding up
- Petition
- Deposit £1,600
- Court Fee £280
- Witness statement verified by statement of truth
