An Administration Order is a way of preserving a company's business with a view to achieving a more advantageous realisation of the company's assets than if the company were to be placed into Liquidation.

A company can be placed into Administration by the direct appointment of an Administrator by the company, its directors or a creditor who holds the necessary security to enable him to make the appointment. Alternatively, a court may make an order to place the company into Administration, upon application by the company, it’s directors or any other creditor.

When a company is in Administration the affairs, business and property of the company are managed by a person (“the Administrator”) appointed for that reason.

The Administrator must be a Licensed Insolvency Practitioner. The powers of the Administrator are very broad. They include carrying on the company's business and realising its assets. This is done by removing the board of directors from its management function.

One of the duties of the Administrator is to prepare proposals for approval by the creditors of he intends to achieve the purpose of the Administration.

At the appointment of an Administrator, the debts which are due to unsecured creditors are frozen. All actions taken by creditors to recover their debts also cease - this includes any proceedings to wind up the company and any steps to enforce security such as the repossession of goods.

For more information or for a free initial consultation please contact your local office or email: recovery@dains.com