Company Winding-Up

Voluntary Initiation

Members Voluntary Winding Up I A company may be wound up voluntarily by way of a members’ voluntary winding up. The procedure is commenced in accordance with the Summary Approval Procedure. The Summary Approval Procedure may also be used in relation to a company whose duration is for a fixed period or until a fixed event occurs.… Read the rest

Termination

Termination of Liquidation In a voluntary liquidation, the liquidator must convene final meetings of the shareholders and creditors. The meetings must be advertised. The liquidator presents the accounts of the liquidation and responds to questions. A return is made to CRO certifying that the meetings were held and filing the liquidator’s account.… Read the rest

Swelling Assets

Unlawful Preference I The bankruptcy rules on “asset swelling” apply to a company liquidation. These rules deem certain pre-liquidation transfers to be invalid. The liquidator may challenge certain transfers and unwind them, in much the same way as the Official Assignee may do in a personal bankruptcy.… Read the rest

Remuneration

Financing and Remuneration The liquidator’s remuneration and expenses are payable in priority to the creditors. In the case of a creditors’ voluntary liquidation, the committee of inspection or the creditors themselves agree the remuneration. It is agreed by the members in a members’ voluntary winding up.… Read the rest

Procedure

Directors’ Powers and Business On the commencement of liquidation, the company must cease to carry out business, except in so far as required for the beneficial winding up. The corporate state and powers continue until the company is dissolved.… Read the rest

Priority

Third Party Interests Assets which are held in trust or in which other persons have an interest are taken by liquidator/ assignee, subject to those interests. They take no better title that that which the insolvent individual/ company held in them.… Read the rest

Powers

Cessation of Directors’ Powers On the commencement of winding up of a company, it shall cease to carry out its business except insofar as may be required for its beneficial winding up. The corporate state and powers continue until the company is dissolved.… Read the rest

Personal Liability

Failure to Keep Accounts I If a company that is being wound up is unable to pay all of its debts and has contravened the obligations regarding the keeping of accounts, then if the court considers that the contravention contributed to the inability to pay the debts; resulted in substantial uncertainty as to the assets and liabilities of the company; or substantially impeded the orderly winding up of the company; then the court may, on the application of the liquidator, creditor or contributory declare, as it thinks proper to do so, that any one or more officers or former officers of the company who are in default in relation to the contravention, shall be personally liable, without limitation, for all, or such part, of the debts of the company, as may be specified.… Read the rest

Moratorium

Moratorium on Legal Proceedings I In the case of a court-ordered liquidation, the liquidation is deemed to commence on the date on which the petition is presented, rather than the date on which the winding–up order is made.… Read the rest

Meetings

Annual Meeting If a members’ voluntary liquidation has continued for more than twelve months, then on the first anniversary, and each subsequent anniversary, the liquidator must convene a members’ meeting. He must summon, giving seven days’ notice, the holding of a general meeting for a day falling not later than 28 days after the anniversary.… Read the rest