What Happens at the Court Hearing for a Winding up Petition ?

At the Court, noth the petitioner and the debtor can either attend in person or choose to have a solicitor represent them. Creditors may also be represented by an employee if they seek the permission of the court to do so. Both administrators and administrative receivers have the right to defend a company against winding up. Voluntary liquidators may attend and present evidence but are prevented from expressing any view.

Anyone else who wishes to attend the hearing must do so via notice to the petitioner, either at the address listed in the Gazette notice or via his legal representative. It is the petitioner’s’ responsibility to then supply the court with a list of persons who have indicated their intention to attend.

What Will the Court Assess?

The court has wide powers to either dismiss, adjourn, make an interim order regarding, or pass the Winding up Petition depending on the circumstances of the case. What they are looking for, in particular, is evidence that creditors have tried all other options available to them to recover their debt, and that debt has still not been paid.

They will also be checking statutory procedure has been met, which includes that the winding up petition has been correctly advertised in the London Gazette, the Certificate of Compliance filed, as well as the Certificates of Supporting Creditors and Continuing Debt.

Considering the Creditors’ Wishes

Judges will always consider the wishes of all the creditors so; even one party is pushing for winding up, the court will ordinarily refuse the petition if a number of the other creditors oppose the liquidation.

Ulterior Motives

Any High Court Judge in a Winding up Case will be looking closely for any evidence of ‘ulterior motives.’ This means that to preserve the integrity of the liquidation process, they want to be sure that the Creditor is merely seeking the repayment of the debt, and has no other intentions or motives towards the debtor.

We are one of the UK’s most experienced company rescue and insolvency practitioner teams, offering a free, confidential advice service for anyone facing creditor pressure. Call us on 08000 746 757 or try the live chat in the bottom right.

 

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