The Insolvency (Northern Ireland) Order 1989

Grounds and effect of winding‐up petitionN.I.

Circumstances in which company may be wound up by the High CourtN.I.

102 .F1  A company may be wound up by the High Court if—

(a)the company has by special resolution resolved that the company be wound up by the Court,

(b)being a public company which was registered as such on its original incorporation, the company has not been issued with [F2a trading certificate under section 761 of the Companies Act 2006 (requirement as to minimum share capital)] and more than a year has expired since it was so registered,

(c)it is an old public company, within the meaning of [F3Schedule 3 to the Companies Act 2006 (Consequential Amendments, Transitional Provisions and Savings) Order 2009],

(d)the company does not commence its business within one year from its incorporation or suspends its business for a year,

(e)F4. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(f)the company is unable to pay its debts,

F5(fa). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(g)the Court is of the opinion that it is just and equitable that the company should be wound up.

Definition of inability to pay debts; the statutory demandN.I.

103.—(1) A company is deemed unable to pay its debts—

F6(a )if a creditor (by assignment or otherwise) to whom the company is indebted in a sum exceeding £750 then due has served on the company, by leaving it at the company's registered office, [F7a written demand] (known as “the statutory demand”) in the prescribed form requiring the company to pay the sum due and the company has for 3 weeks thereafter neglected to pay the sum or to secure or compound for it to the reasonable satisfaction of the creditor, or

(b)if, in Northern Ireland, a certificate of unenforceability has been granted in respect of a judgment against the company under Article 19 of the Judgments Enforcement (Northern Ireland) Order 1981F8, or

(c)if, in England and Wales, execution or other process issued on a judgment, decree or order of any court in favour of a creditor of the company is returned unsatisfied in whole or in part, or

(d)if, in Scotland, the induciae of a charge for payment on an extract decree, or an extract registered bond, or an extract registered protest, have expired without payment being made, or

(e)if it is otherwise proved to the satisfaction of the High Court that the company is unable to pay its debts as they fall due.

(2) A company is also deemed unable to pay its debts if it is proved to the satisfaction of the High Court that the value of the company's assets is less than the amount of its liabilities, taking into account its contingent and prospective liabilities.

(3) The money sum for the time being specified in paragraph (1)(a) is subject to increase or reduction by order under Article 362(1)(a).

Application for winding upN.I.

104.—(1) Subject to the provisions of this Article, an application to the High Court for the winding up of a company shall be by petition presented either by the company, or the directors, or by any creditor or creditors (including any contingent or prospective creditor or creditors), contributory or contributories F9..., [F10or by the chief clerk in exercise of the power conferred by section 35(4A) of the Criminal Justice Act (Northern Ireland) 1945 (enforcement of fines imposed on companies) or a clerk of petty sessions in exercise of the power conferred by Article 92A of the Magistrates' Courts (Northern Ireland) Order 1981 (enforcement of fines imposed on companies)] or by all of any of those parties, together or separately.

(2 )F11 Except as mentioned in paragraph (3), a contributory is not entitled to present a winding‐up petition unless either—

(a)the number of members is reduced below 2, or

(b)the shares in respect of which he is a contributory, or some of them, either were originally allotted to him, or have been held by him, and registered in his name, for at least 6 months during the 18 months before the commencement of the winding up, or have devolved on him through the death of a former holder.

(3 )F11 A person who is liable under Article 63 to contribute to a company's assets in the event of its being wound up may petition on either of the grounds set out in Article 102(f) and (g), and paragraph (2) does not then apply; but unless the person is a contributory otherwise than under Article 63, he may not in his character as contributory petition on any other ground.

(4) F12. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

[F13(4AA) A winding up petition may be presented by the [F14Financial Conduct Authority] in a case falling within Article 104C(1) or (2).]

F15(4A) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(5) A winding‐up petition may be presented by the Department—

(a )F11if the ground of the petition is that in Article 102(b) or (c), or

[F16(b)in a case falling within Article 104A[F17 or 104B].]

[F18(5A) A winding-up petition may be presented by the Regulator of Community Interest Companies in a case falling within section 50 of the Companies (Audit, Investigations and Community Enterprise) Act 2004.]

(6) Where a company is being wound up voluntarily, a winding‐up petition may be presented by the official receiver as well as by any other person authorised in that behalf under the other provisions of this Article; but the High Court shall not make a winding‐up order on the petition unless it is satisfied that the voluntary winding up cannot be continued with due regard to the interests of the creditors or contributories.

[F19Petition for winding up on grounds of public interestN.I.

104A.—(1) Where it appears to the Department from—

(a)any report made or information obtained under[F20 Part 14 of the Companies Act 1985] (company investigations, &c.),

[F21(c )F22any report made by inspectors under—

(i)section 167, 168, 169 or 284 of the Financial Services and Markets Act 2000, or

(ii)where the company is an open-ended investment company (within the meaning of that Act), regulations made as a result of section 262(2)(k) of that Act;

(cc )F22any information or documents obtained under section 165, 171, 172, 173 or 175 of that Act;]

(d)any information obtained under section 2 of the Criminal Justice Act 1987 or section 52 of the Criminal Justice (Scotland) Act 1987 (fraud investigations), or

(e)any information obtained under section 83 of the Companies Act 1989 (powers exercisable for purpose of assisting overseas regulatory authorities),

that it is expedient in the public interest that a company should be wound up, it may present a petition for it to be wound up if the court thinks it just and equitable for it to be so.

(2) This Article does not apply if the company is already being wound up by the court.]

[F23Petition for winding up of SEN.I.

104B.—(1) Where—

(a)an SE whose registered office is in Northern Ireland is not in compliance with Article 7 of Council Regulation (EC) No 2157/2001 on the Statute for a European Company (the “EC Regulation”) (location of head office and registered office), and

(b)it appears to the Department that the SE should be wound up,

the Department may present a petition for it to be wound up if the court thinks it is just and equitable for it to be so.

(2) This Article does not apply if the SE is already being wound up by the court.

(3) In this Article “SE” has the same meaning as in the EC Regulation.]

[F24Petition for winding up of SCEN.I.

104C—(1) Where, in the case of an SCE whose registered office is in Northern Ireland—

(a)there has been such a breach as is mentioned in Article 73(1) of Council Regulation (EC) No 1435/2003 on the Statute for a European Cooperative (SCE) (the “European Cooperative Society Regulation”) (winding up by the court or other competent authority), and

(b)it appears to the [F25Financial Conduct Authority] that the SCE should be wound up,

the [F26Authority may] present a petition for the SCE to be wound up if the court thinks it is just and equitable for it to be so.

(2) Where, in the case of an SCE whose registered office is in Northern Ireland—

(a)the SCE is not in compliance with Article 6 of the European Cooperative Society Regulation (location of head office and registered office), and

(b)it appears to the [F27Financial Conduct Authority] that the SCE should be wound up,

the [F28Authority may] present a petition for the SCE to be wound up if the court thinks it is just and equitable for it to be so.

(3) This Article does not apply if the SCE is already being wound up by the court.

(4) In this Article “SCE” has the same meaning as in the European Cooperative Society Regulation.]

Powers of High Court on hearing of petitionN.I.

105.—(1) On hearing a winding‐up petition the High Court may dismiss it, or adjourn the hearing conditionally or unconditionally, or make an interim order, or any other order that it thinks fit; but the Court shall not refuse to make a winding‐up order on the ground only that the company's assets have been mortgaged to an amount equal to or in excess of those assets, or that the company has no assets.

(2) If the petition is presented by members of the company as contributories on the ground that it is just and equitable that the company should be wound up, the High Court, if it is of the opinion—

(a)that the petitioners are entitled to relief either by winding up the company or by some other means, and

(b)that in the absence of any other remedy it would be just and equitable that the company should be wound up,

shall make a winding‐up order; but this does not apply if the Court is also of the opinion both that some other remedy is available to the petitioners and that they are acting unreasonably in seeking to have the company wound up instead of pursuing that other remedy.

Power to stay or restrain proceedings against companyN.I.

106.—(1) At any time after the presentation of a winding‐up petition, and before a winding‐up order has been made, the company, or any creditor or contributory, may—

(a)where any action or proceeding against the company is pending in the High Court or Court of Appeal, apply to the Court in which the action or proceeding is pending for a stay of proceedings therein, and

(b)where any other action or proceeding is pending against the company, apply to the High Court to restrain further proceedings in the action or proceeding;

and the Court to which application is so made may (as the case may be) stay or restrain the proceedings accordingly on such terms as it thinks fit.

(2 )F29 In the case of[F30 a company registered but not formed under the Companies Act 2006], where the application to stay or restrain is by a creditor, this Article extends to actions and proceedings against any contributory of the company.

[F31(3) Paragraph (1) applies in relation to any action being taken in respect of the company under Part 1 of Schedule 8 to the Finance (No. 2) Act 2015 (enforcement by deduction from accounts) as it applies in relation to any action or proceeding mentioned in sub-paragraph (b) of that paragraph.]

Avoidance of property dispositions, etc.N.I.

107 .F32—[F33(1)] In a winding up by the High Court, any disposition of the company's property, and any transfer of shares, or alteration in the status of the company's members, made after the commencement of the winding up is, unless the Court otherwise orders, void.

[F34(2) This Article has no effect in respect of anything done by an administrator of a company while a winding-up petition is suspended under paragraph 41 of Schedule B1.]

[F35(3) This Article has no effect in respect of anything done during a moratorium under Part 1A, or during a period mentioned in Article 18(4)(a) following the end of a moratorium, where the winding-up order was made on a petition presented before the moratorium begins, unless the petition was presented under section 367 of the Financial Services and Markets Act 2000 on the ground mentioned in section 367(3)(b) of that Act.]

Avoidance of sequestration or distressN.I.

108.—[F36(1)] Where a company is being wound up by the High Court, any sequestration or distress put in force against the estate or effects of the company after the commencement of the winding up is void.

[F37(2) In paragraph (1) the reference to “sequestration or distress” includes a hold notice or a deduction notice under Part 1 of Schedule 8 to the Finance (No. 2) Act 2015 (enforcement by deduction from accounts) and, if paragraph (1) has effect in relation to a deduction notice, it also has effect in relation to the hold notice to which it relates (whenever the hold notice was given).]