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Administration

A petition is presented to the Court for the appointment of an Administrator which can be done by the Directors of a company, its creditors or by the company itself.   Debenture holders must be given at least 5 days notice and have an absolute right of veto - so it is always important to consult the Bank at an early stage.

The effect of an Administration Order is:

  • The right to appoint an Administrative Receiver is lost.
  • Winding up petitions are dismissed.

Creditors can take no further action without the leave of the Court, including Hire Purchase or Leasing Creditor’s as well as those claiming Retention of Title.

We recognise that this is a difficult area for Lenders since so many negotiations in advance of an Administration Petition involve asking them to allow their security to be used and possibly compromised during the Administration process.
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