Receivership—an introductory guide


Published by a ½Û×ÓÊÓƵ Restructuring & Insolvency expert
Practice notes

Receivership—an introductory guide


Published by a ½Û×ÓÊÓƵ Restructuring & Insolvency expert

Practice notes
imgtext

The appointment of a receiver is a remedy for creditors and certain third parties to protect their interest in assets of a company.

This guide gives an introduction to the types of receiverships available and some of the effects of appointing a receiver. For links to the materials available in the Receivership subtopic, see: Receiverships—overview.

The following points are common to all forms of receivership:

  1. •

    a company need not be insolvent to be placed in receivership

  2. •

    the appointment of a receiver does not prevent other creditors from taking action against the company

  3. •

    the company’s ability to deal with the property subject to the receiver’s appointment will be restricted during the course of the receivership

  4. •

    following receivership, a company need not necessarily be liquidated (its affairs brought to an end)

Points specific to the various forms of receivership are set out below.

Law of Property Act (LPA)/fixed charge receiver

The Law of Property Act 1925 (LPA 1925) enables a mortgagee to appoint an LPA receiver:

  1. •

    when the mortgage moneys become due, and

  2. •

    after

Powered by Lexis+®
Jurisdiction(s):
United Kingdom
Related legal acts:
Key definition:
Receiver definition
What does Receiver mean?

In relation to real property there are two relevant types of receiver: a receiver appointed by the holder of a fixed charge and an administrative receiver. An administrative receiver is appointed by the holder of a floating charge and has extensive powers to manage the company over which it is appointed. In relation to a floating charge granted after 15 September 2003, the right to appoint an administrative received has been severely curtailed. Fixed charge receivers, also known as LPA receivers, have more limited powers in relation to the asset charged only.

Read more readmore

Popular documents

How to commence a voluntary winding-up

How to commence a voluntary winding-upThis Practice Note sets out the position from 6 April 2017.The resolution to wind-upA company may only enter voluntary liquidation if:•it has a fixed period for its duration which has expired or an event has occurred which its articles say is an event leading to

How an administration comes to an end

How an administration comes to an endThere are several ways in which an administration can come to an end depending on the specific circumstances of the administration.The starting point is that an administration should not last longer than 12 months—the administration will come to an automatic end

What are provisional liquidators, when are they appointed, and why?

What are provisional liquidators, when are they appointed, and why?What is a provisional liquidator?A provisional liquidator is, in effect, an interim liquidator, where a licensed insolvency practitioner (IP) or the official receiver (OR) is appointed under section 135 of the Insolvency Act 1986 (IA

Termination of LPA or fixed charge receivership

Termination of LPA or fixed charge receivershipA note on terminologyThe Law of Property Act 1925 (LPA 1925) enables a mortgagee of a legal mortgage to appoint an LPA receiver:•when the mortgage moneys become due, and•after making a demand for payment under the terms of the mortgageThis right may