Antecedent Transactions: Undervalue and Preference – if you are a creditor of an insolvent company or a bankruptcy, Oliver Elliot can help. We Know Insolvency Inside Out.
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What Are Antecedent Transactions?
Undervalue and Preference transactions entered into prior to the insolvency that can be set aside by an Insolvency Practitioner in certain insolvency proceedings.
Transactions at an Undervalue
A Transaction At An Undervalue is a transaction within 2 years of the relevant insolvent date (in the case of bankruptcy that period can extend to 5 years) which appear to be for less than their money’s worth. Such transactions can be set aside by the officeholder of the insolvent estate for the benefit of creditors.
Typically such transactions will involve transfers of money or property to connected and or associated parties. The applicable statutory provisions are Section 238 of the Insolvency Act 1986 and Section 339 of the Insolvency Act 1986.
Preferences
A Preference is a transaction within 2 years of the relevant insolvent date which appear to have put someone in a better position than which they ought to have been and influenced by a desire to prefer them.
Such transactions can be set aside by the officeholder of the insolvent estate for the benefit of creditors if certain insolvency and other criteria are met. Typically such transactions will involve transfers of money or property to connected and or associated parties.
The applicable statutory provisions are Sections 239 of the Insolvency Act 1986 or Section 340 of the Insolvency Act 1986.
Transactions Defrauding Creditors
Transactions that are known as transactions defrauding creditors have no limitation period. They are undertaken to put assets beyond the reach of creditors at an undervalue. Such transactions can be set aside by the officeholder of the insolvent estate for the benefit of creditors if certain insolvency and other criteria are met. The applicable statutory provision is Section 423 of the Insolvency Act 1986.
These are transactions that appear to be for less than their money’s worth. Such transactions can be set aside by the officeholder of the insolvent estate for the benefit of creditors.
Typically such transactions will involve transfers of money or property to connected and or associated parties.
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Disclaimer: Antecedent Transactions: Undervalue and Preference
This page: Antecedent Transactions: Undervalue and Preference is not legal advice and should not be relied upon as such. This article Antecedent Transactions: Undervalue and Preference 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.
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