The company, its creditors, shareholders or directors can issue a winding up petition in court for a company to be wound up in respect of an unpaid debt. A date for a winding up hearing is set and on the date of the hearing if the judge is satisfied that the company is unable to pay its debts, a winding up order is made. The Official Receiver is then appointed to assess the company’s assets and liabilities and decide whether it is appropriate to seek the appointment of a liquidator. The directors must attend an interview with the Official Receiver to answer questions regarding the company’s trading and the reasons for the company’s failure.
Compulsory Liquidation may be appropriate when:
- The business is insolvent and no longer viable and/or
- The shareholders cannot agree to pass the resolutions to place the company into Creditors’ Voluntary Liquidation and/or
- A statutory demand for payment of an unpaid debt has been served on the company and remains unpaid after 21 days
To issue a petition for a winding up order you may require legal assistance. Get further information about winding up petitions and the liquidation of your company here or contact us for further assistance.