Q&As

Where a creditor submits a proof of debt form in an administration of a company without expressly preserving its rights under any security it may have against the directors of that company, would it: (i) be deemed to have waived its rights to claim (anything) under a personal guarantee with the directors (ii) be unable to claim more (say further accrued interest and/or fixed compensation under Late Payment of Commercial Debts (Interest) Act 1998) under the personal guarantee agreement than the sum stated in the proof of debt form—on grounds it has claimed for only part of the debt against the company and therefore waived any claim it may have for further sums due?

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Published on LexisPSL on 15/10/2018

The following Restructuring & Insolvency Q&A provides comprehensive and up to date legal information covering:

  • Where a creditor submits a proof of debt form in an administration of a company without expressly preserving its rights under any security it may have against the directors of that company, would it: (i) be deemed to have waived its rights to claim (anything) under a personal guarantee with the directors (ii) be unable to claim more (say further accrued interest and/or fixed compensation under Late Payment of Commercial Debts (Interest) Act 1998) under the personal guarantee agreement than the sum stated in the proof of debt form—on grounds it has claimed for only part of the debt against the company and therefore waived any claim it may have for further sums due?

Where a creditor submits a proof of debt form in an administration of a company without expressly preserving its rights under any security it may have against the directors of that company, would it: (i) be deemed to have waived its rights to claim (anything) under a personal guarantee with the directors (ii) be unable to claim more (say further accrued interest and/or fixed compensation under Late Payment of Commercial Debts (Interest) Act 1998) under the personal guarantee agreement than the sum stated in the proof of debt form—on grounds it has claimed for only part of the debt against the company and therefore waived any claim it may have for further sums due?

It is assumed that the creditor holds a personal guarantee agreement from the company’s director to repay the debt if the company fails to do so.

A creditor wishing to file a claim for its debt in an administration must submit a written claim to the administrator in accordance with Insolvency Rules 2016 (IR 2016), SI 2016/1024, r 14.2–14.25. The only exception is if the claim is for less than £1000 and the administrator has opted to treat the debt as if it were proved for the purposes of paying a dividend under IR 2016, SI 2016/1024, r 14.31.

A creditor can alter the amount claimed by the proof at any time by

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