Creditors meeting
Are liquidation committees necessary?
Sometimes when a company is wound up via compulsory liquidation or creditors’ voluntary liquidation (CVL) a liquidation committee is formed to monitor the liquidator’s activities and look after creditors’ interests. Without liquidation committees, liquidators could do as they please and put their own interests over those of creditors. The establishment of a committee gives creditors…
Read MoreBenefits of a creditors’ committee
Creditors in a statutory insolvency procedure should establish a creditors’ committee if they want to influence proceedings, set the basis for the insolvency practitioner’s fees, and increase dividends for the general body of creditors. A creditors’ committee consists of 3 to 5 people who are responsible for setting the basis of the insolvency practitioner (IP)’s…
Read MoreHow to make the most of creditors’ meetings (part 2)
Creditors in a statutory insolvency procedure must request and attend a physical creditors’ meeting if they want to assert any significant influence. A meeting of creditors normally takes place shortly after a company becomes insolvent. There creditors get the chance to: Hear an explanation of why the business failed Appoint an insolvency practitioner (IP) Agree…
Read MoreHow to make the most of creditors’ meetings
Most creditors assume they’ve lost all their money when a customer enters a formal insolvency procedure. That’s because few creditors understand how much they can influence an insolvency procedure by actively engaging at Creditors’ Meetings. Creditors’ Meetings usually take place between 1 and 10 weeks after a company declares insolvency. At this meeting, creditors are:…
Read MoreCongratulations to Arcadia’s CVA creditors
Creditors of a business that has recently entered a company voluntary arrangement (CVA) would be wise to follow the example set last month by the creditors of waning fashion retailer Arcadia. Arcadia’s creditors did well to encourage Sir Philip Green and his wife to part with more money than they’d intended. Simply by standing up…
Read MoreNew reforms are great, but who protects unsecured creditors?
In a controversial speech to the Insolvency Practitioner’s Association earlier this year, Court of Appeal judge Lord Justice Jackson (best-known for his 2010 report into civil litigation costs) made several recommendations, which Justice Secretary Michael Gove has already begun to implement. As a result, from 1 April 2016, unsuccessful defendants will no longer be held…
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