Company Law Essay Help : Winding up of the Company before the Court

Company Law Cases referred to in this section
Re Bryant Investment Co Ltd [1974] 2 All ER 683, [1974] 1 WLR 826

A company who is not an unregistered company or society may be wound up by the court if:

  • the company has by special resolution resolved that the company be wound up by the court (Insolvency Act 1986 s 122(1)(a));
  • being a public company which was registered as such on its original incorporation, the company has not been issued with a certificate that the requirements of a public company's share capital have been satisfied and more than a year has expired since it was so registered ( Insolvency Act 1986 s 122(1)(b)-(c) - awinding-up petition may also be presented by the Secretary of State on these grounds: Insolvency Act 1986 s 124(4)(a). Section 124(4)(a));
  • the company is an old public company (Insolvency Act 1986 s 122(1)(c) - a winding-up petition may also be presented by the Secretary of State on these grounds: s 124(4)(a)).
  • the company does not commence its business within a year from its incorporation, or suspends its business for a whole year;
  • except in the case of a private company limited by shares or by guarantee, the number of members is reduced below two (Insolvency Act 1986 s 122(1)(e) (amended by the Companies (Single Member Private Limited Companies) Regulations 1992, SI 1992/1699, reg 2(1)(b), Schedule para 8));
  • the company is unable to pay its debts (Insolvency Act 1986 s 122(1)(f)) - this can be for example where a creditor, by assignment or otherwise, to whom the company is indebted in a sum exceeding £750 then due (see Re Bryant Investment Co Ltd [1974] 2 All ER 683, [1974] 1 WLR 826), has served on the company, by leaving the same at its registered office, a written demand in the prescribed form ('the statutory demand') requiring the company to pay the sum so due, and the company has for three weeks thereafter neglected to pay the sum, or to secure or compound for it to the reasonable satisfaction of the creditor;
  • at the time at which a moratorium for the company comes to an end, no voluntary arrangement has effect in relation to the company;
  • the court is of the opinion that it is just and equitable that the company should be wound up;
  • on a petition by the official receiver or by any other person authorised to present a winding-up petition, the court is satisfied that an existing voluntary winding up cannot be continued with due regard to the interests of creditors or contributories;
  • it appears to the Secretary of State from any report made or information or documents obtained under certain provisions of the Companies Act 1985 or the Financial Services and Markets Act 2000 or from information obtained under the Criminal Justice Act 1987 or the Companies Act 1989 that it is expedient in the public interest that the company should be wound up, and the court thinks it is just and equitable for it to be wound up; or
  • one of the conditions under which the Financial Services Authority may present a winding-up petition to the court is satisfied.
A limited liability partnership may be wound up by the court if:
  • the partnership has determined that it be wound up by the court (Insolvency Act 1986 s 122(1)(a); Limited Liability Partnerships Regulations 2001, SI 2001/1090, Sch 3);
  • the partnership does not commence its business within a year from its incorporation or suspends its business for a whole year ( Insolvency Act 1986 s 122(1)(b); Limited Liability Partnerships Regulations 2001, SI 2001/1090, Sch 3);
  • the number of members is reduced below two (Insolvency Act 1986 s 122(1)(c); Limited Liability Partnerships Regulations 2001, SI 2001/1090, Sch 3);
  • the partnership is unable to pay its debts (Insolvency Act 1986 s 122(1)(d); Limited Liability Partnerships Regulations 2001, SI 2001/1090, Sch 3); or
  • the court is of the opinion that it is just and equitable that the partnership should be wound up (Insolvency Act 1986 s 122(1)(e); Limited Liability Partnerships Regulations 2001, SI 2001/1090, Sch 3)

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