How can creditors participate in the prescribed part?
An administrator, liquidator or receiver must make a ‘prescribed part’ of the company’s net property available for the satisfaction of unsecured debts. The amount of the prescribed part will depend upon the amount of the company’s assets that are realised but is subject to a maximum of £600,000. The prescribed part must not be distributed to the proprietor of a floating charge unless the claims of unsecured creditors have been satisfied and there is a surplus.
The courts have established that a creditor, having made a secured recovery, cannot share in the prescribed part in respect of its unsecured shortfall and that a secured creditor can share in the prescribed part if it releases its security and proves as an unsecured creditor.
The recent High Court decision of Re JT Frith Ltd has shown how senior secured creditors may be able to participate in the prescribed part while at the same time retaining their security…
Click on the link below to read the rest of the Walker Morris briefing.
Sign in or Register to continue reading this article
It's quick, easy and free!
It takes just 5 minutes to register. Answer a few simple questions and once completed you’ll have instant access.Register now
Why register to The Lawyer
In-depth, expert analysis into the stories behind the headlines from our leading team of journalists.
Identify the major players and business opportunities within a particular region through our series of free, special reports.
Receive your pick of The Lawyer's daily and weekly email newsletters, tailored by practice area, region and job function.
More relevant to you
To continue providing the best analysis, insight and news across the legal market we are collecting some information about who you are, what you do and where you work to improve The Lawyer and make it more relevant to you.
News from Walker Morris
News from The Lawyer
Briefings from Walker Morris
The Court of Justice of the European Union has ruled that the one-off provision of incorrect information to a consumer is a ‘misleading commercial practice’.
From 1 October this year, landlords who let English properties will have to be wary of a change to the law introduced by the Deregulation Act 2015.
Analysis from The Lawyer
Which firms are cutting it in this era of slimline rosters, and who are the GC new brooms making clean sweeps? The Lawyer can reveal all
The law school war shows no signs of ending. But we have, perhaps, reached the end of the beginning.