Removal of voluntary liquidator by creditors' decision procedure—the position under the Insolvency (England and Wales) Rules 2016
Produced in partnership with Robert Smailes of Leonard Curtis Business Solutions Group and Simon Hunter of ThreeStone
Removal of voluntary liquidator by creditors' decision procedure—the position under the Insolvency (England and Wales) Rules 2016

The following Restructuring & Insolvency practice note Produced in partnership with Robert Smailes of Leonard Curtis Business Solutions Group and Simon Hunter of ThreeStone provides comprehensive and up to date legal information covering:

  • Removal of voluntary liquidator by creditors' decision procedure—the position under the Insolvency (England and Wales) Rules 2016
  • Removal of a voluntary liquidator following the Insolvency (England and Wales) Rules 2016 (IR 2016)
  • Procedure for removal of a voluntary liquidator by creditors’ decision procedure
  • Proposal of decision procedure and costs
  • Voting in a decision procedure
  • Meeting
  • Procedure on removal

Removal of a voluntary liquidator following the Insolvency (England and Wales) Rules 2016 (IR 2016)

A voluntary liquidator can only be removed by an order of the court, a meeting of members or a qualifying decision procedure by creditors.

Only the members may remove a liquidator in a members’ voluntary winding up and only the creditors in a creditors’ voluntary winding-up. This Practice Note deals only with creditors' meetings in creditors’ voluntary liquidations (CVLs).

This Practice Note sets out the position from 6 April 2017 when the Insolvency (England and Wales) Rules 2016, SI 2016/1024 (IR 2016) came into force.

Procedure for removal of a voluntary liquidator by creditors’ decision procedure

Proposal of decision procedure and costs

  1. A decision procedure must be instigated under section 171(2)(b) of the Insolvency Act 1986 (IA 1986) for the removal of the liquidator if 25% in value of the company’s creditors, excluding those connected with the company, request it. This is unless the liquidator was appointed by the court under section 108, when the procedure is to be instigated only if: (a) the liquidator thinks fit; (b) the court orders it; or (c) 50% in value of the creditors request it.

  2. There appears to be no authority on when the court will order a decision procedure under section 171(3A). However, in cases on the equivalent power in MVLs the court has said

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