Just and equitable winding-up—what it is and when to use it
Produced in partnership with Mark Hubbard of New Square Chambers
Just and equitable winding-up—what it is and when to use it

The following Dispute Resolution practice note produced in partnership with Mark Hubbard of New Square Chambers provides comprehensive and up to date legal information covering:

  • Just and equitable winding-up—what it is and when to use it
  • What is a just and equitable winding-up petition?
  • Key terms encountered when applying for a winding-up on the just and equitable ground
  • Legal basis for a just and equitable winding-up
  • Standing to bring a just and equitable winding-up petition
  • Companies in relation to which a just and equitable winding-up petition can be presented
  • Unfair prejudice as grounds for just and equitable winding-up
  • Other grounds for just and equitable winding-up
  • Petitioner’s conduct/delay in seeking a just and equitable winding-up
  • Remedy available
  • More...

A guide to specific terminology used in this Practice Note is provided—see below section titled ‘Key terms encountered when applying for a winding-up on the just and equitable ground’.

For content concerning relevant procedure, see also Practice Note: Just and equitable winding-up—the procedure.

What is a just and equitable winding-up petition?

A petition to wind up a company on the just and equitable ground is a statutory remedy, provided by sections 122–125 of the Insolvency Act 1986 (IA 1986). Although the petition seeks the compulsory winding-up of the company in question, it is a claim that is made by a minority shareholder in respect to a solvent company and to which the majority and not the company is the proper active defendant, as in an unfair prejudice petition. It is sometimes also called a contributory’s petition.

Winding up a solvent company by consent (or by a vote of the necessary majority at a general meeting of the company) can be achieved out of court by way of a members’ voluntary liquidation. For further information, see: Members' voluntary liquidation (MVL)—overview.

The situations in which a minority shareholder might be advised to pursue a petition for a just and equitable winding-up are, in general, limited to those unusual circumstances where on the same facts an unfair prejudice petition is not available or unlikely to succeed or (more commonly) as an alternative

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