Administration Orders

Administration orders are made by the Court in cases where an individual or company needs protection from its creditors, preventing them taking legal action including bankruptcy, winding-up, and bailiff action.

In the case of limited companies, an administration order is often applied for in advance of making proposals to creditors under a Company Voluntary Arrangement. An Administrator is appointed to take care of the companies assets, and usually to keep it trading whilst the CVA proposals are prepared. Once a company is in Administration, its creditors cannot petition for a winding-up, or take any other Court action.

In the case of individuals, an administration order sets an amount that the debtors must pay to the creditors each month, based on his ability to pay. There is no Court fee for the order, but a proportion of what is paid under the order is taken by the Court to contribute to the cost.

Once the order is granted, the creditors cannot take any action against the debtor, including presenting a bankruptcy petition, obtaining a County Court Judgement, or sending bailiffs. An administration order can only be granted at the request of an individual if:

His total debts are less than £5,000 - At least one CCJ has been issued. An administration order is a useful tool for dealing with small debts and can be used as means to prevent creditor action until a more permanent solution is found.

 

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When you or your company are made bankrupt, your assets (possessions, home, income etc) can be used to pay your debts. You have to agree to certain restrictions and your financial affairs will be investigated. Find out how bankruptcy affects you and where to get advice on dealing with your debts.

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