Re Norditrack (UK) Ltd
| Jurisdiction | England & Wales |
| Judgment Date | 14 June 1999 |
| Date | 14 June 1999 |
| Court | Chancery Division |
CHANCERY DIVISION
Before Mrs Justice Arden.
Insolvency - time of commencement of voluntary liquidation - presumption
The presumption contained in section 86 of the Insolvency Act 1986 as to the time of commencement of a voluntary liquidation, namely at the time of the passing of the resolution for voluntary winding up, had the effect that there was no power to ensure that the liquidation occurred immediately on discharge of the administration by passing resolutions for voluntary liquidation conditionally on the court making the order for discharge.
Mrs Justice Arden so held in the Chancery Division hearing an application by the administrator of Norditrack (UK) Ltd for the discharge of the administration order prior to the company entering voluntary winding up.
Mr Peter Shaw for the administrator.
MRS JUSTICE ARDEN said that in order that the onset of insolvency for the purpose of sections 238 and 239 of the 1986 Act should be the date of the administration order rather than the date of commencement of voluntary liquidation, it was necessary that the voluntary winding-up should commence immediately on the discharge of the administration.
The procedure to be adopted had been considered in In re Powerstore (Trading) LtdWLR ((1997) 1 WLR 1280) and in In re Mark One (Oxford Street) plcWLR ((1999) 1 WLR 1445).
In those cases, the resolutions for voluntary liquidation were intended to be passed conditionally on the court making an order for discharge of the administration order. But in neither case was the attention of the court drawn to section 86. That section created a separate problem. It provided that a voluntary winding up be deemed to commence at the time of the passing of the resolution for voluntary winding up. That was a presumption as to the time of the commencement of the voluntary liquidation which could not be changed by the parties.
Her Ladyship referred to In re West Cumberland Iron and Steel CompanyELR((1889) 40 ChD 361) where it was held that the voluntary winding-up would commence with the date of the resolution...
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