Company liquidation is defined in three distinct ways;
When a company goes into liquidation, the costs of the proceedings are usually paid out of its assets. The first two types of liquidation mentioned above are insolvent liquidations and there is no prospect of a return to the members.
A Members' Voluntary Liquidation is different. The members (shareholders) will see a return after creditors have been paid in full, and they therefore have a direct interest in the level of costs, and in particular, the remuneration of the insolvency practitioner appointed to act as liquidator.
The insolvency legislation recognises this interest by providing mechanisms for members to fix the basis of the liquidators’ fees, (also referred to a ‘remuneration’).
This guide (see PDF below) is intended to help shareholders be aware of their rights to approve and monitor fees, explains the basis on which the fees are fixed, and how shareholders can seek information about expenses incurred by the liquidator and challenge those they consider to be excessive.