Sterling Ford - Insolvency & Bankruptcy Services

The purpose of administration is to achieve:
  1. The rescue of a company as a going concern,
  2. A better result for the company's creditors as a whole than would be likely if the company were wound up (without first being in administration),
  3. The realisation of property in order to make a distribution to one or more secured or preferential creditors.

Administrators can be appointed to companies that are unable, or are likely to become unable, to pay their debts and their appointment may be made by:
  1. the courts - on application from a creditor, directors or partners, or

  2. the holder of a qualifying floating charge over the assets of the business, or

  3. the company or its directors

AdministrationThe company enters administration once the appointment of an administrator takes effect whereupon the administrator will assume the responsibility of managing the company's affairs, business and property in order to meet its specified purpose. Upon the administrator's appointment any pending winding-up petitions will be dismissed or suspended and there will be a moratorium on insolvency and other legal proceedings.
No later than 8 weeks following his appointment, the administrator must issue a statement to creditors and members setting out his proposals for achieving the purpose of the administration or his reasons why it cannot be achieved. These proposals may incorporate a compromise or arrangement with creditors and/or members as well as a voluntary arrangement.

The administration will end upon notification to the Registrar of Companies, where appropriate, when the administrator's term of office expires, which will be:
  1. At the end of 12 months unless extended by the consent of creditors or the court,

  2. As soon as the administrator determines that the purpose of the administration has been sufficiently achieved or it cannot be achieved or the administration was inappropriate,

  3. Upon the successful application of a creditor alleging an improper motive on the part of the appointor,

  4. Upon the company proceeding into a creditors' voluntary liquidation or to dissolution,

For a different perspective, call us now on 0808 171 2291 or complete our enquiry form.