Winding Up Petition And Recover A Debt. If you are a creditor of an insolvent company or a bankruptcy, Oliver Elliot can help you address your claim and concerns arising from the insolvency.
Winding Up Petition What Next? is a guide to explain what you might need to now consider in your road to recover a debt. For the avoidance of any doubt this guide promises no outcome but a recurring theme repeated time and again is – ‘it does not have to be that way’.
Winding Up Petition And Recover A Debt – What Next? It can potentially be soul-destroying for someone to engage in lengthy litigation, often moving perhaps somewhat glacially for a number of years only to discover that the company you have been pursuing to recover a debt has seemingly walked away from your efforts but – it does not have to be that way.
It is common for our CEO, Elliot Green at Oliver Elliot, to be introduced to creditors who have embarked upon sometimes years of litigation and then having had no returns after such efforts, issue a Winding Up Petition, end up with a Winding Up Order for Compulsory Liquidation, and to then have the potentially devastating news from the Official Receiver, whose report may say something to the effect of:
‘… there appear to be no assets available and therefore I would not anticipate a distribution being made to creditors…’
Imagine the consequences for legal advisers if they had overlooked to map out from day one this possible outcome for a client who has no other desire or expectation other than recovery in full of the debt. If this has not been pointed out then one can envisage a client having a few stern words with such advisers if this is the deemed end result. However – it does not have to be that way.
To be absolutely clear, nobody can or should ever promise that you will ever recover your money. There are few certainties in life besides death or taxes. Debt recovery is not one of them. However, being cautioned against the prospects of recovery of a debt and the possibility that you might never see your hard-earned cash again, does not mean that you have lost it. It also does not mean that you are throwing good money after bad; it means that you ought to go forwards properly informed and with your eyes wide open. You might recover some or all of your money and then again you might not.
The Way Forward – Winding Up Petition And Recover A Debt
One thing might be notable, you may stand a lower prospect of recovering your money if you do nothing and walk away once you have issued a Winding Up Petition and obtained a Winding Up Order. A lack of engagement in the process by creditors can all too frequently mean that crucial information is not provided to the Liquidator to pursue investigations and the acceptance of no recovery as a fait accompli, risks in effect supporting the whole negativity that can fuel belief in the minds of creditors who really and genuinely believe that no matter what, that they can and will never get their money back.
There may well be certain instances in which this is true but the trenchant belief risks spreading far wider than those cases where liquidation means that the creditors wind up with nothing. This belief risks infecting and adversely so, the reality that there are many cases in which this ought not to be the case but public perception risks taking over and may substitute for what could otherwise have been an alternative, far more positive position.
Just in case it has not been made absolutely crystal clear therefore, the assumption frequently made that a company being pursued for a debt and which has gone into Liquidation such as Compulsory Liquidation or Creditors Voluntary Liquidation, means that you will get nothing back is not always wrong but– it does not have to be that way.
The starting point is the realisation that when you are dropped into the world of insolvency recoveries you are no longer necessarily recovering your debt alone. You might be but then again you might also be thrown into the pot with all the other creditors, now mixed up in what is known as a class remedy.
You may arguably have to adjust your thinking to accept therefore that it might no longer simply be your piece of litigation any longer. It is however because many people at this point in effect give up, that the chance of recovery of money for many slips away and is lost. The problem is that the process can take so long and be so time-consuming, that for many their heart goes out of it.
For many who have successfully built up their businesses, they have done so with persistence, perseverance and persuasion. Those same qualities are still reasonably required at the point when the Winding Up Petition transforms into a Winding Up order and the Compulsory Liquidation sets in motion. Now is arguably not the time to be taking the foot off the gas but in fact, it is perhaps the time to refuel for the next part of the journey hopefully towards the recovery that could be achieved.
Those who with tenacity and who pace themselves can perhaps keep going in the ring to the further rounds that are now mapped out through the insolvency proceedings. Those with trenchant determination and who seek out similarly minded but fully licensed, ethical professionals of integrity will perhaps stand a much better chance of recovering their debt or some of it.
Appoint A Liquidator: Winding Up Petition And Recover A Debt
Once the Compulsory Winding Up has been ordered your next port of call is conceivably to appoint a Licensed Insolvency Practitioner to act as the Liquidator. To do this if you so wish, you will need to replace the Official Receiver with the Insolvency Practitioner of your choice.
If the fear of throwing good money after bad is overwhelming then be aware that some Insolvency Practitioners such as our CEO, Elliot Green, may act on a No Recovery No Fee basis so that your risk is minimised, and no further cash is put at risk by you to take the matter further.
What Is No Recovery No Fee? Winding Up Petition And Recover A Debt
No Recovery No Fee is the agreement by a Liquidator to act on the basis that his or her remuneration will only be discharged from realisations if there are few or no readily realisable assets available to pay the Liquidator’s fees. It is in effect arguably someone putting their money where their mouth is to some extent because to work on such a performance basis has the risk of going unrewarded for all of the work done. Our CEO, Elliot Green may and does frequently act on such a No Recovery No Fee basis for the benefit of creditors to enable them to seek to maximise realisations and hopefully recover some or all of their debt.
Supply Of Information To Help The Liquidator Make A Recovery: Winding Up Petition And Recover A Debt
It is very important that creditors looking to recover a debt supply to the Liquidator all information concerning their dealings with the company that they have been pursuing for money. Emails are particularly important to start to assemble the evidence to enable the Liquidator to embark upon sufficient reconstruction of the company in liquidation’s records and therefore discover the potential recovery actions that might be available to bring, to in effect seek to get creditors some or all of their money back.
In addition, when you obtain the reports from the Liquidator, scrutinise them because it is worth remembering that a Liquidator enters office as a stranger to the affairs of the company in liquidation. You may well be able to help and point out misunderstandings based on your detailed knowledge as a creditor of a company’s affairs and therefore open up avenues for recovery that were it not for your input, might have been potentially blocked. That is why it is important that a creditor works with and helps a Liquidator in the recovery process so that the best and most accurate information can be assembled to progress the investigations that may lead to legal proceedings for compensation. These may often be sought from the former Directors who may or may not have been involved in some or combinations of the following:
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This post: Winding Up Petition And Recover A Debt – What Next? is not legal advice and should not be relied upon as such. This post Winding Up Petition And Recover A Debt – What Next? is provided for information purposes only. You can Contact Us on the specific facts of your case to obtain relevant advice via a Free Initial Consultation.