Expert Company LiquidatorsServing Royston Businesses

A company liquidator is a licensed insolvency practitioner who manages the closure of an insolvent company. They realise assets, agree claims with creditors, investigate director conduct, and ensure the company is dissolved properly. Their role is to achieve the best outcome for creditors whilst ensuring legal compliance.

The cost of liquidation varies based on company size, asset complexity, and creditor numbers. Typically, fees are taken from the company's assets, but if there are insufficient assets, directors may need to fund the process personally. A licensed practitioner can provide a fixed-fee quote after assessing your situation.

Compulsory liquidation is a court-ordered process, often triggered by a creditor's petition. Creditors' voluntary liquidation (CVL) is initiated by directors when the company is insolvent, and shareholders pass a resolution. Both end with dissolution, but the CVL is usually faster and gives directors more control.

Once liquidation begins, directors lose control of the company. The liquidator takes over, and trading ceases unless the liquidator decides it is beneficial to complete work in progress. Continuing to trade after insolvency is known as wrongful trading and can lead to personal liability for directors.

A typical creditors' voluntary liquidation takes between six and twelve months to complete. The liquidator must realise assets, investigate affairs, and distribute funds to creditors. Simpler cases may conclude sooner, while complex ones with legal disputes or asset recovery can take longer.

Alternatives include a company voluntary arrangement (CVA), administration, or informal negotiation with creditors. A CVA allows the company to continue trading while paying debts over time. Administration provides a moratorium from creditors, giving time to restructure or sell the business. Each option has different implications for directors.

Employees are made redundant when a company enters liquidation, unless the liquidator retains them temporarily to assist. They may claim statutory redundancy pay, unpaid wages, and holiday pay from the National Insurance Fund. The liquidator provides necessary documentation to support these claims.

Directors are generally not liable for company debts if they have acted properly. However, personal liability can arise for wrongful trading, fraudulent trading, or if personal guarantees were given. A liquidator investigates director conduct and may take action to recover funds for creditors if misconduct is found.

Creditors have the right to be informed of the liquidation and to vote on the choice of liquidator. They can also form a liquidation committee to oversee the liquidator's actions. Secured creditors may enforce their security, while unsecured creditors receive dividends based on available assets.

For a creditors' voluntary liquidation, you do not need to attend court. The process involves shareholder and creditor meetings, which can be held virtually. Compulsory liquidation requires a court hearing, usually initiated by a creditor, but you may not need to attend if you consent to the order.