Click here to learn more about our revolutionary app or download directly from one of the sources below.
In all other circumstances the words “date of commencement of Liquidation” mean the date of the presentation of the petition, once the Order has been made.
The Liquidator must use the date of the petition in these circumstances, as the commencement of (Compulsory) Liquidation, which is backdated once the Order has been made.
It will always be the date of the Special Resolution in a Creditors’ Voluntary Liquidation.
[See ‘Liquidation’, ‘Liquidator’, ‘Compulsory Liquidation’, ‘Insolvency Rules’, ‘Insolvency Act’, ‘Creditors’ Voluntary Liquidation’ and ‘Commencement of Liquidation’.]
Winding-up by the court (WUC) is also known as a ‘Compulsory Liquidation’.
This is an insolvency procedure that applies to companies (and partnerships) and is started by the filing (or ‘presenting’) of a petition at court normally by a creditor, stating that the company owes a sum of money and that the company cannot pay.
Via a court process it is then decided, the ‘petitioner’ having served the petition and a statement of truth on the respondent company, whether it is appropriate to make a winding-up Order. The most common reason for a winding-up Order is that the company is insolvent, but most of the petitions presented are by unpaid creditors who have run out of options to request or force a company to pay them an amount owed.
Once the winding-up Order is made the date of commencement of the Compulsory Liquidation is backdated to the date of presentation of petition. At that time many things happen automatically. For example, any existing litigation or other action against the company are ‘stayed’ (they stop at that moment).
Employees and directors of the company are automatically dismissed. Landlords can take no action for any arrears of rent owed.
When a winding-up Order has been made, the Official Receiver is initially appointed as Liquidator. The company’s creditors and contributories may appoint another individual, who must be a registered Insolvency Practitioner, to act as Liquidator but this is increasingly unusual in the modern day, as the Official Receiver will often take jobs through to their conclusion. An example
