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A petition is the formal document that commences an action against a company in Compulsory Liquidation, or the debtor (via a creditor application) in a Bankruptcy.
The contents of this petition are set out in Rule 7.5 of the Insolvency Rules 2016 for a corporate matter, and Rules 10.7 to 10.9 in a personal insolvency. These are rules that are worth a quick read in either Butterworths Insolvency Law Handbook, or Sealy and Milman.
[See ‘Compulsory Liquidation’, ‘Bankruptcy’, ‘Insolvency Rules’ and ‘Source’.]
In Greek mythology the phoenix is an immortal bird that cyclically regenerates, or is otherwise born again. Associated with the sun, a phoenix obtains new life by rising from the ashes of its predecessor.
When a company goes into Liquidation, those involved may start a new company which is commonly in the same trade, and may use the same assets or name as the liquidated company.
These new companies may be called ‘successor’ or ‘phoenix’ companies. When the new company uses the same or similar name as its original it can be said it is ‘holding out’, or pretending it is the original company (to encourage loyalty to the brand, etc.).
The Court of Appeal have held that there is no requirement for proof of any express misrepresentation, or of anyone actually having been deceived or confused into thinking there was an association between the two companies.
Instead, the test to be applied appears to be whether the names are so similar that they would be likely to suggest to a member of the public that they are associated, whether as successor companies or as part of the same group.
Under sections 216-217 Insolvency Act 1986, where a company trades under a prohibited name (the same or similar name as the previous company) an individual can be guilty of a criminal offence punishable by imprisonment or .ne, or both for:
