A court may order a company to be wound up and appoint an Official Liquidator to act.
Such orders may be made where the company is proved to be insolvent, where the Directors have acted in their own interests rather than the interests of the shareholders or where the court is of the opinion that the interests of the public, shareholders or creditors are best served by that course of action or where they are of the opinion that it is just and equitable that the company be wound up.
Any of the following can apply to the court for the appointment of a Liquidator.
The Australian Securities and Investments Commission
Once a Liquidator has been appointed he has extensive powers to displace the directors and assume full control of the company’s affairs.
The main task is to take possession of the company’s assets and realise them so that the surplus funds can be distributed to creditors.
Where the assets are more than sufficient to meet the claims of creditors, the surplus funds are distributed to the members in accordance with the company’s Constitution.
For more detailed information on Official Liquidations please contact the team at Chifley Advisory for free confidential advice.