Glossary of Terms
Administration order
An order made in a county court to arrange and administer the payment of debts by an individual;
or an order made by a court in respect of a company that appoints an administrator to take control of the company. A company can also be put into administration if a floating charge holder, or the directors or the company itself file the requisite notice at court.
Administrator
An IP appointed by the court under an administration order or by a floating charge holder or by the company or its directors filing the requisite notice at court.
Annulment
Cancellation.
Assets
Anything that belongs to the debtor that may be used to pay his/her debts.
Charge
Security interest taken over property by a creditor to protect against non-payment of a debt (such as a mortgage).
Creditor
Someone owed money by a bankrupt or company.
Dividend
Any sum distributed to unsecured creditors in an insolvency.
Fixed charge
A charge held over specific assets. The debtor cannot sell the assets without the consent of the secured creditor or repaying the amount secured by the charge.
Guarantee
An agreement to pay a debt owed by a third party. It must be evidenced in writing for it to be enforceable.
Insolvency Practitioner
An authorised person who specialises in insolvency, usually an accountant or solicitor. They are authorised either by the Secretary of State or by one of a number of recognized professional bodies.
Nominee
An IP who carries out the preparatory work for a voluntary arrangement, before its implementation.
Petition
A formal application made to a court.
Preferential creditor
A creditor who is entitled to receive certain payments in priority to floating charge holders and other unsecured creditors. These creditors include occupational pension schemes and employees.
Proof of debt
A statutory form completed by a creditor in a compulsory liquidation to state how much is claimed. The form is supplied by the Liquidator.
Proxy
Instead of attending a meeting, a person can appoint someone to go and vote in their place - a 'proxy'.
Proxy form
Form that must be completed if a creditor wishes someone else to represent him or her at a creditors' meeting and vote on his or her behalf.
Realise
Realising an asset means selling it or disposing of it to raise money, for example to sell an insolvent's assets and obtain the proceeds.
Receiver
The commonly used name for an administrative receiver. The term can also mean a person appointed by the court or with the power to receive the rents and profits of property. Receivers who are not administrative receivers do not need to be insolvency practitioners.
Secured creditor
A creditor who holds security, such as a mortgage, over a person's assets for money owed.
Statement of affairs
A document sworn under oath, completed by a bankrupt, company officer or director(s), stating the assets and giving details of debts and creditors.
Supervisor
An IP appointed to supervise the carrying out of a company voluntary arrangement.
Unsecured creditor
A creditor who does not hold security (such as a mortgage) for money owed. Some unsecured creditors may also be preferential creditors. |
