Interim liquidators woman stopping a shark from going nearer

On Occasion, it is useful to appoint an ‘interim liquidator’ to hold the fort while the usual process is traversed.

The Court may appoint an interim liquidator in order to maintain the value of a company’s assets during the period following the filing of a liquidation application.

This is a powerful safeguard in regard to the assets of a company and it is often overlooked by those seeking to liquidate a company. The Court may appoint an interim liquidators if:

  • The company’s assets are in jeopardy;
  • The status quo should be maintained; and
  • The interests of creditors require a safeguard.

However, there are three main preconditions to the interim liquidator’s appointment:

A liquidation application must be filed which discloses good grounds for putting the company into liquidation.

  • There must be a need for urgency.
  • The circumstances must justify the appointment of an interim liquidator.

The Court retains discretion as to whether the appointment ought to be made. The Court will only exercise its discretion if it necessary or expedient for the purpose of maintaining the value of the assets owned or managed by the company.

For a full analysis of appointing interim liquidators and relevant considerations for creditors, we refer you to the article by Norling Law: Appointment of Interim Liquidators

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