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The principal duties of an Administrator are to be impartial during their time in control of the company. They must act in good faith, and with reasonable care and skill. They must also take reasonable action to achieve the best price on realisation of assets. In addition, an Administrator must carry out the insolvency process as quickly and efficiently as is practicable.
The monitor of a moratorium under CIGA 2020 is an officer of the court, with all the duties such a position entails.
The principal duty of a director of a company is their fiduciary duty; they must act in the best interest of the company, its creditors and members and be constantly aware of their duty to enlighten shareholder value (enhance the estate for stakeholders and members) and act as a reasonably prudent and diligent director would act, whilst acting in accordance with any additional qualifications, skill and experience they have.
[See ‘Liquidator’, ‘Trustee in Bankruptcy’, ‘Administrator’, ‘Insolvency Act’, ‘CIGA’, ‘Moratorium’, ‘Director’ and ‘Shareholder’.]
Under section 236 Insolvency Act 1986 a Liquidator has a power to apply to the court to conduct a private examination.
Upon the insolvency of a company an officeholder, such as a Liquidator, may make an application to court, to summon before it any officer or any person known or suspected to have in his possession any property or who may be able to provide information concerning the promotion, formation or business dealings and affairs and property of the company.
The person who is summonsed may be required to provide an affidavit to account for their dealings with the company. A private examination will be conducted in front of a Judge and be taken under oath.
This is not a step an officeholder would take as an initial exercise to retrieve information. First they would talk to the person suspected to be in possession of the asset or information and then they would talk to others who might have information that would be useful to them.
