The life of a company may be terminated as follows:
a) Compulsory liquidations commenced by petition to the court;
b) Voluntary liquidations commenced by resolution of the members;
c) Voluntary liquidations subject to the courts supervision order. Shares are virtually absolute;
d) Company transferring its undertaking to another company under a scheme of reconstruction or amalgamation may be dissolved by court order without winding up Sec.209.
e) A defunct company may be struck off the register by the Registrar and so dissolved without winding up.
Liquidation and winding up mean the same thing. A company cannot be made bankrupt.
Powers of the Liquidator
These powers fall into two categories:
Those which he may exercise without sanction and those which require sanction.
With the consent of C of I, the liquidator may:-
a) Bring or defend any legal proceedings in the name and on behalf of the company;
b) Carry on the company's business so far as may be necessary for its beneficial winding-up;
c) Appoint a lawyer to assist him;
d) Pay any class of creditors in full;
e) Make compromise claims arrangements with creditors;
f) Compromise claims against contributions for unpaid capital by the company against any person.
Without consent of C of I, the liquidator may:-
a) Sell and transfer the company's property;
b) Do all acts and execute all documents in the name of and on behalf of the company;
c) Prove in the bankruptcy of any contributory;
d) Sign bills of exchange or promissory notes in the name and on behalf of the company;
e) Raise money on the security of the company's assets;
f) Appoint an agent to do business which the liquidator cannot do himself;
g) To do all things necessary to wind-up the company affairs and distribute the assets.
Duties of the Liquidator under the Act and Winding-up Rules
The liquidator must:-
a) Take all the company's property into his custody or control as soon as possible;
b) Settle a list of contributories, discharge its liabilities and distribute any surplus amongst the members;
c) Have regard to any directions given by resolution of creditors or contributories at a meeting or by C of I. Directors of the creditors or contributories override those of the C of I. He must summon meetings of creditors or contributories at such times as they, by resolution, direct or when requested in writing to do so by ten or more of the creditors or contributories;
d) Keep the prescribed books and subject to the control of the court, allow any contributory or creditor to suspect them;
e) Send an account in the prescribed form of his receipts and payments to registrar;
f) Pay all money received by him during the liquidation into the company's liquidation insolvency services account;
g) If the winding-up is not completed within a year after its commencement, send to the Registrar at the end of that year, a statement in the prescribed form concerning the progress of the liquidation;
h) Pay into Insolvency Services Account all money representing unclaimed or undistributed assets which have remained unclaimed or undistributed for six months. Thereafter, any person claiming any part of such moneys may apply to the Registrar for an order for such payment.