When Is A Company Deemed Insolvent? Can Directors Appeal Against Winding Up Orders?
06 Jul 2021
The Court of Appeal has clarified (i) the test relating to when a company will be deemed to be insolvent pursuant to Section 254(2)(c) of the Companies Act (re-enacted as Section 125(2)(c) of the Insolvency, Restructuring and Dissolution Act 2018) and (ii) whether directors of a company that has been wound up may appeal against the winding up order.
This article provides a summary of the Court of Appeal’s decision and additional considerations that distressed companies should consider. Directors should be mindful of personal liability for costs incurred in bringing an appeal against a winding up order if the appeal is found to be unmeritorious.
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