MH Restructuring

Tuesday 13 June 2017

Let’s be clear – intention means intention!

Since 2003, placing a company into administration has been a lot easier than it used to be. Formerly, an administration could only be initiated with an application to court which was expensive, could be slow and with no certain outcome guaranteed. The out of court administration option, introduced in that year, is a far cheaper and more streamlined means of having a company placed into administration and is the option now used in the vast majority of cases.

The out of court option is commonly started with the filing in court of a notice of intention to appoint an administrator (“Nol”)(pursuant to paragraphs 26 and 27 of Schedule B1 to the Insolvency Act 1986). This is used where the appointment is sought by either the company itself or its directors. The key benefit accruing from the filing of a Nol is that the company in question is immediately protected from potential creditor action by an interim 10 business day moratorium.