The following Property guidance note provides comprehensive and up to date legal information covering:

  • Insolvency—administration
  • Appointment
  • Objectives
  • Qualification and powers
  • Moratorium
  • Interim moratorium
  • Pre-packs
  • Contract for sale drafting considerations
  • General drafting considerations

Administration was introduced by the Insolvency Act 1986 (IA 1986) and the procedure was heavily revised by the Enterprise Act 2002.


Administrators may be appointed:

  1. by the court on the application of the company, its directors and/or any of one or more of its creditors

  2. by the holders of a qualifying floating charge (QFC) without applying to court (note that this also appears to be individual QFC holder's as well as companies—see Re Armstrong Brands Ltd (In Administration)); although a notice of appointment must be filed with the court. A QFC either states that IA 1986, Sch B1, para 14 applies to it or authorises the charge holder to appoint an administrator or an administrative receiver

  3. by the company or its directors without applying to court (notice of appointment to be filed)


The objectives of administration are, in strict order:

  1. to rescue the company as a going concern

  2. to achieve a better result for the company’s creditors as a whole than would be likely if the company was wound up (without being in administration first)

  3. to realise property in order to make a distribution to one or more secured or preferential creditors

An administrator is an officer of the court and has an overriding duty to act in the interests of the company's creditors.

The primary objective is to