Receivership Part Two Flashcards
What is the general power granted to a receiver under s.437 CA 2014?
To do all things necessary or convenient to attain the objectives of their appointment.
What are some specific powers of a receiver under s.437(3)?
Control property, sell/lease assets, borrow money, carry on business, appoint agents, litigate, and make share calls.
Who can apply to court for directions under s.438 CA 2014?
Receiver, company officers, members, ≥50% employees, creditors (>€13k), liquidator, or contributories.
Can a receiver disclaim onerous contracts like in liquidation?
No statutory right exists, but the receiver may refuse to perform if done in good faith.
What duty does a receiver owe when selling company property under s.439 CA 2014?
Must use reasonable care to obtain the best price reasonably obtainable at time of sale.
Can a receiver sell assets privately to a former officer?
Only with 14 days’ notice to all known creditors.
What did Re Bula Ltd establish about ‘best price’?
Duty refers to ‘price’ not ‘value’; best price is assessed based on time of sale.
Do receivers owe duties to guarantors?
Yes – guarantors can sue if property is sold below best price, increasing their liability.
Do receivers owe duties to unsecured creditors?
No – clarified in Ruby Property Co v Kilty.
Must a receiver provide information to the company or directors?
No general duty unless special circumstances exist (Irish Oil & Cake Mills v Donnelly).
How must sale proceeds be applied under a fixed charge?
Surplus goes to the company, not preferential creditors.
What happens with sale proceeds under a floating charge?
Preferential creditors are paid first (s.440 CA 2014), then any surplus goes to the company.
What must a receiver file with the CRO?
An abstract showing assets, receipts, and payments, and notify solvency status when ceasing.
Is a receiver personally liable for contracts made during receivership?
Yes, unless contract states otherwise. Receiver is not liable for pre-appointment contracts.
How is receiver remuneration determined?
By court (if court-appointed) or agreement with debenture-holder; courts can override low pay clauses (Re Red Sail Frozen Foods).
How can a receiver be removed?
By contract terms, court (s.435 CA 2014), examiner (if <3 days), or limited by liquidator via s.455.
Is a receiver liable for poor management?
Unsettled. Likely only for bad faith, though Medforth v Blake suggests a duty of due diligence may apply.
