WINDING UP PETITION
Prevent a winding up petition being successful, pay off your debts and continue trading - call Tenable NOW to find out how. 01484 866920.
The term "winding up petition" usually refers to an application to a court to put a company into liquidation, although companies can be wound up voluntarily without the need for court intervention.
A winding up petition is a legal document that is submitted by the party or parties wishing to liquidate the company. These parties may be the directors of the company themselves, or may be a third party such as a creditor.
Why issue a Winding up Petition?
It is not acceptable for a third party to attempt to wind up a company purely to recover debt, nor is it necessarily in the creditor's interests to do so. However, if all other attempts to obtain payment of money owed have failed, a creditor may issue a winding up petition as a last resort.
What happens when a Winding up Petition is issued?
If a winding up petition is issued against you, a court hearing will already have been arranged. Winding up a company in this way is also referred to as Compulsory Liquidation.
If you have not already sought the advice of a debt counsellor or licensed insolvency practitioner, you must do so now. You will be required to appear in court and, if you wish to address the court in any way, you must have legal representation.
If the winding up petition is successful, the court will order that an administrator be appointed to conclude your company's affairs. Any creditors, including employees, HMRC and trade creditors, will be paid from the available funds, and at the end of the process, your company will be dissolved and will no longer exist.
What to do if a Winding up Petition is issued
First and foremost, if a winding up petition is issued against you, it is imperative that you seek advice at the earliest opportunity. Contact a specialist in debt solutions like Tenable, who can advise the appropriate course of action.
Stopping a Winding up Petition.
Sometimes it is possible to stop a winding up petition, but only if you act quickly and decisively. Seek advice as soon as possible, for the more time you have to propose an alternative to the compulsory liquidation of your company; the more likely you are to be successful in stopping the winding up petition. However, no matter how close it is to the court hearing, Tenable can still help. If there is an alternative solution, such as a Company Voluntary Arrangement, we may be able to make a proposal to the court that this path be followed instead. This would allow your company to continue trading and clear its debts.
If you then wish to access your Bank Account in order to keep trading and get access to any funds locked then you will need to apply for validation order.
If you receive a winding up petition, it is very important you get professional help and advice asap.