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Whether you are the director, shareholder or employee of a company that is struggling to meet its financial liabilities or an individual or business which is currently dealing with an insolvent company, Saracens Solicitors can help you to navigate the complex law of insolvency and advise you on the best course of action to take.
What We Cover?
Our expertise covers the following insolvency regimes:
- Company Voluntary
Placing a company into administration prevents creditors from taking action through the courts to recover any debts owed. This provides a business in administration the time to trade its way out of insolvency.
If the company cannot be rescued then the administrators can work on a strategy to ensure existing creditors will be better compensated than if the company was simply wound up.
An administrator can be appointed by the order of the court, by the directors of the company themselves or by the holder of a floating charge. If you are owed money by a company that has been placed in administration then it will be a comfort to know that the administrator has a duty to act in the company’s creditors’ best interests.
Company Voluntary Arrangement
A Company Voluntary Arrangement (CVA) is an arrangement made between a company and its unsecured creditors allowing the company to re-negotiate its debts so it can pay them off over time and still continue trading.
It is important to seek legal advice early on if you are thinking of proposing a CVA to your creditors. Our experienced commercial team can assist you in negotiating a strong proposal to present to your current creditors which will take the stress off the current situation and put you in a position to get your company back on its feet.
If you are a creditor being presented with a CVA, we can talk you through the process and advise you as to whether a CVA will work in your best interests.
Liquidation or Winding Up
In order to voluntarily liquidate or wind up a company the organisation in question must:
- Not be able to pay its financial obligations; and
- Receive a 75% majority in favour of the liquidation when a vote on the matter is put to the shareholders.
A company can also be placed into compulsory liquidation by the court.
If a company is liquidated it will be wound up and its assets will be used to pay its creditors.
If your company is being placed into liquidation, either voluntarily or by a court order it is important that you seek legal advice as directors of liquidated companies can be forbidden to own another company for a number of years, and may even be prosecuted.
If you are a creditor of a company currently being wound up, our experienced team can advise you on your rights and where you stand with regards to receiving payment.
A Receiver is brought in by a creditor (often a bank) who has a charge over a majority of the company’s assets. For example, if you have a mortgage over the building your company trades from and are unable to meet your mortgage payments then the mortgage company who holds the mortgage over your property can bring in a Receiver to act in its best interests to recover as much of the debt as possible.
The commercial team at Saracens Solicitors has the expertise a major creditor requires and can advise on how and when a Receiver should be appointed.
Our client-focused, multi-lingual commercial lawyers can advise directors, shareholders and creditors if a company they are associated with is becoming, or has become insolvent, whether the company is in the UK or is based abroad, or has subsidiaries in overseas locations. To talk with one of our practitioners please request a call back or phone us on 020 3588 3500.