Insolvency, Restructuring and Dissolution Act 2018 · 2020 Revised Edition · Part 8 · Winding Up
178. Power of liquidator to accept shares, etc., as consideration for sale of property of company
Feedback & supportWhere it is proposed that the whole or part of the business or property of a company (called in this section the company) be transferred or sold to another corporation (called in this section the corporation), the liquidator of the company may, with the sanction of a special resolution of the company conferring either a general authority on the liquidator or an authority in respect of any particular arrangement —
property
“property” includes —(a)money, goods, things in action, land and every description of property, wherever situated; and(b)obligations and every description of interest, whether present or future or vested or contingent, arising out of or incidental to property;
receive in compensation or part compensation for the transfer or sale, any shares, debentures, policies or other like interests in the corporation for distribution among the members of the company; or
enter into any other arrangement under which the members of the company may, in lieu of or in addition to receiving cash, shares, debentures, policies or other like interests in the corporation, participate in the profits of or receive any other benefit from the corporation.
Any transfer, sale or arrangement mentioned in subsection (1) is binding on the members of the company.
company
“company” has the meaning given by section 4(1) of the Companies Act 1967;
If any member of the company expresses the member’s dissent to the resolution mentioned in subsection (1) in writing addressed to the liquidator and left at the registered office of the liquidator within 7 days after the passing of the resolution, the member may require the liquidator either —
member
“member”, in relation to a company, means a member of a company mentioned in section 19(6) or (6A) of the Companies Act 1967;
to abstain from carrying the resolution into effect; or
to purchase the member’s interest at a price to be determined by agreement or by arbitration in the manner provided by this section.
If the liquidator elects to purchase the member’s interest, the purchase money must be paid before the company is dissolved and be raised by the liquidator in such manner as is determined by special resolution.
liquidator
“liquidator” includes the Official Receiver when acting as the liquidator of a corporation;
A special resolution is not invalid for the purposes of this section by reason that it is passed before or concurrently with a resolution for voluntary winding up or for appointing liquidators, but if an order for winding up the company by the Court is made within a year after the passing of the resolution, the resolution is not valid unless sanctioned by the Court.
special resolution
“special resolution” means a special resolution mentioned in section 184 of the Companies Act 1967;
For the purposes of an arbitration under this section, the Arbitration Act 2001 applies as if there were a submission for reference to 2 arbitrators, one to be appointed by each party, and the appointment of an arbitrator may be made under the hand of the liquidator or, if there is more than one liquidator, under the hands of any 2 or more of the liquidators.
The Court may give any directions necessary for the initiation and conduct of an arbitration under this section, and such direction is binding on the parties.
In the case of a creditors’ voluntary winding up, the powers of the liquidator under this section must not be exercised except with the approval of the Court or the committee of inspection.