Company Liquidations

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	Status			There are three kinds of company liquidation: Members Voluntary Liquidation The company is solvent, but the shareholders wish to wind up the company and realise their interests. A liquidation is faster and cleaner than an application to strike off a company under Section 652 Companies Act 1985. Creditors Voluntary Liquidation The company is insolvent, and the directors' start voluntary proceedings. Compulsory Liquidation The company is insolvent, and the directors are unwilling start voluntary proceedings.
	Appointee			Members Voluntary Liquidation The members appoint a liquidator of their choice. Creditors Voluntary Liquidation The company calls a creditors' meeting and members to appoint a liquidator (insolvency practitioner). Compulsory Liquidation The creditors petition the court, and upon the granting of a liquidation order, the Official Receiver becomes the liquidator. In all cases the liquidator takes over control of the company, and the directors lose their office.
	Procedure and outcome			Members Voluntary Liquidation It is not necessary to hold a creditors meeting, but the directors declare that all debts will be repaid within 12 months. The liquidator realises the assets and discharges all debts within the prescribed period. Creditors Voluntary Liquidation The liquidator will realise the assets, and use the available funds to pay off the secured, preferred, and finally unsecured creditors in that order. Compulsory Liquidation If their are assets, the Official Receiver will call a creditors' meeting to appoint a liquidator. The liquidator will the assets, and use the available funds to pay off the secured, preferred, and finally unsecured creditors in that order. The Official Receiver will remain in charge if there are no assets, and in both cases undertake an investigation to determine if any further action should be taken. The company will be automatically dissolved after three months after the liquidator has filed his return of the final meeting in the liquidation. It is interesting to note that a dissatisfied creditor registered at the time of the liquidation, can apply to the court to have the company restored to the Company Register within two years of the dissolution. The comparable period in a S.652 dissolution is 20 years.
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