One of the debt collection procedures available to a creditor of a company is to issue a winding up petition.
The creditor must be owed at least £750 and be able to prove that the debtor company is unable to pay the debt, which is usually achieved by holding an un-satisfied High Court or County Court Judgment or following the issue of a Statutory Demand.
A Statutory Demand may be issued directly by the debtor company, without the use of legal representation, for a debt that is less than 6 years old.
The creditor company will have 21 days to either settle the debt, or come to an arrangement to settle the debt, but if neither happens by the end of the 21-day period, the creditor will be at liberty to issue a winding up petition.
In order to issue a winding up petition, the creditor will have to pay court costs of £280 plus £1,600 for a petition deposit (to cover the costs of the winding up). HM Revenue & Customs probably issue more winding up petitions than any other creditor.
The winding up petition will be served upon a director or employee of the company and the petition may even be attached to the front door of the company’s address if it cannot be served in person.
At least 7 days before the court hearing stated in the petition, it must be advertised in The Gazette.
If the petition is successful at the hearing, the court will make a winding up order against the company and appoint an Official Receiver to deal with the liquidation.
If your company has received a winding up petition you need to take professional advice as soon as possible.
Newton Cooper are specialist insolvency practitioners in Bolton and offer free and confidential advice without any obligation whatsoever.Contact Us