Liquidating distribution detailed example
The proceeds of realisation of assets under a floating charge will first be used to pay certain priority claims in accordance with section 328 of the Companies Act (Cap.
Such claims would include undertaking legal proceedings for recovery of moneys.
b) Prosecution of company officers Apart from the prosecution of directors or officers who fail to file the Statement of Affairs, delinquent directors and officers of the company in winding up can also be held liable for a range of offences including falsification of books, failure to keep proper accounts and fraudulent trading.
Compulsory winding up Under section 253 of the Companies Act (Cap.
50), the company itself, creditors, contributories, liquidator, judicial manager or the Minister may present a winding up application to the High Court.
It must be noted that the liquidator shall not be liable to incur any expenses in relation to a winding up unless there are sufficient available assets.
A creditors' meeting may be convened for the purpose of obtaining the creditors' consent to pursue a claim that is worth pursuing and to meet the expenses of pursuing such a claim.
The common grounds for a company to be wound up by the Court include: The company is deemed unable to pay its debts under section 254(2)(a) of the Companies Act (Cap.
50) if a company's creditor, who is owed more than S,000, has served a demand for the sum owing at the registered office of the company, and the company has not paid this sum for three weeks thereafter.
The applicant has to pay a winding up deposit of ,400 to the Official Receiver, and the Court may appoint the Official Receiver or an approved liquidator as the liquidator of the company.