Partnership administration orders
Partnership administration orders

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

  • Partnership administration orders
  • The regime
  • Who may appoint an administrator?
  • Court appointment
  • Appointment by the holder of a qualifying charge
  • Appointment by the members
  • Interim moratorium
  • Effect of an administration order
  • Conduct of the administration
  • Termination of the administration

The regime

A partnership cannot create a floating charge. Any partnership which can be wound up by the court in England and Wales can also be the subject of administration. The regime is very similar to that applicable to companies under Part 2 of the Insolvency Act 1986 (IA 1986), but with minor amendments reflecting the differences in internal structure between a company and a partnership. The exception to the general nature of the amendments is the provision that a reference to 'administrative receiver' or 'floating charge' is to be read as 'agricultural receiver' and 'agricultural floating charge' respectively, since a partnership cannot create a floating charge (see Re West Park Golf & Country Club [1997] 1 BCLC 20).

Articles 6(4)–6(5) of the Insolvent Partnerships Order 1994, SI 1994/2421 (IPO 1994) list various other provisions of the IA 1986 which also apply to partnership administration orders.

Who may appoint an administrator?

An administrator may be appointed in relationship to a partnership by:

  1. the court

  2. the holder of a qualifying agricultural floating charge (as defined in IA 1986, Sch 1, para 14), or

  3. the members of an insolvent partnership

Court appointment

The court may make a partnership administration order in the same circumstances as in relation to a company, namely if it is