Effects of an order for compulsory liquidation, Business Law and Ethics

Effects of an Order for Compulsory Liquidation:

The effects of the order are follows as are:

(a) the Official Receiver (an Official of the High Court whose duties relate mainly to bankruptcy of individuals) becomes provisional liquidator; s.236

(b) the liquidation is deemed to have begun at the time (possibly several months earlier) when the petition was first presented.  If the compulsory liquidation follows voluntary liquidation already in progress (see Southard Case above) liquidation runs from the commencement of the voluntary liquidation: s.226.

(c) any disposition of the company's property and transfer of its shares subsequent to the commencement of liquidation is void unless the court orders otherwise: s.224.

(d) any legal proceedings in progress against the company are halted (and none may thereafter begin) unless the court gives leave.  Any seizure of the company's assets after commencement of liquidation is void: ss.225 and 228.

(e) the employees of the company are automatically dismissed.  The provisional liquidator assumes the powers of management previously held by the directors.

The assets of the company remain the company's legal property but under the liquidator's control unless the court by order vests the assets in the liquidator.  The business of the company may continue but it is the liquidator's duty to continue it with a view only to realisation, e.g. by sale as a going concern.  Any floating charge crystallizes.  Liquidation may invalidate charges and other previous transactions.

Posted Date: 1/15/2013 4:53:51 AM | Location : United States







Related Discussions:- Effects of an order for compulsory liquidation, Assignment Help, Ask Question on Effects of an order for compulsory liquidation, Get Answer, Expert's Help, Effects of an order for compulsory liquidation Discussions

Write discussion on Effects of an order for compulsory liquidation
Your posts are moderated
Related Questions
Loans to Directors: Section 191(1) renders unlawful any loan made by a company to a director of the company or its holding company. It is also unlawful for the company to guar

1. a.  Read this summary of a journal article about education and the recent uprisings in the Middle b.    Model the decision whether to participate in a rally like our two peri

Statutory Provisions:  i) Definition of "Prospectus" A prospectus is defined by S.2 as "any prospectus, notice, circular, advertisement or other invitation offering to the

Challenging an Arbitral Award Conversely a party dissatisfied through an arbitral award any challenge that it in the High Court and the High Court might set it aside whether i

Q. Show the Number of phoenix operators ? A key challenge in quantifying phoenix activity is estimating the number of companies engaging in the activity. In 2001/02, 1.6% of co

Law of Contract: Mr.Sakr who owns a factory in Baabda for manufacturing furniture, signed a contract in his factory in 12-7-2009 with Mr.Abdo who used to import woods from Bra

Brief theoretical conceptualization of  Multiple Equilibria We now come to a brief theoretical conceptualization which may give us a basis for choice of agenda or a policy prop

What is Diplomatic immunity Diplomatic immunity relates to the protection of the representatives of another state to ensure that they perform their international political func

Question 1: (a) Briefly outline the role of the State in Employee Relations. (b) Write short notes on any three of the following: (i) The Ministry of Labour and Industrial

The three regimes:- i. Right over Territorial Waters: The right over territorial waters extends up to 12 nautical miles (NM) from the baseline of a coastal state. Territorial w