The following Restructuring & Insolvency guidance note provides comprehensive and up to date legal information covering:
This Practice Note is a summary of the key points relating to a creditors' voluntary liquidation (CVL) from a dispute resolution perspective.
A CVL is a director-led voluntary process of winding up an insolvent company. It is seen as an alternative to the company being wound up by the court on a winding-up petition presented against it, typically by a creditor of the company. The process is instigated by the board of directors who will then call a shareholders' meeting at which the resolution to put the company into liquidation will be voted upon. It is available to any company where the directors are not able to sign a statutory declaration of solvency (setting out that the company will, in their opinion, be able to pay its debts in full with statutory interest within a stated period of not more than one year).
There is no automatic stay on existing proceedings continuing or on new proceedings being commenced against a company in CVL. However if a liquidator, a creditor or contributory wants proceedings to be stayed they can make an application to the court for it to impose a stay (section 126 of the Insolvency Act 1986 (IA 1986)).
The court will need
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