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Companies Act 1993

Shareholders and their rights and obligations - Liability of shareholders

103: Liability of an assignee

You could also call this:

“Assignee's limited responsibility for bankrupt shareholder's unpaid shares”

If you own a share in a company and you go bankrupt, someone called an assignee will take control of your property. This includes your company shares. The assignee’s responsibility for your shares is limited. They only have to pay up to the amount that’s left from your property after other claims have been paid. This amount is what’s available to be shared among the people you owe money to.

The assignee is the person who takes charge of your property when you’re bankrupt. This happens under the Insolvency Act 2006.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM320478.

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Part 7 Shareholders and their rights and obligations
Liability of shareholders

103Liability of an assignee

  1. The liability of the assignee of the property of a bankrupt, who is registered as the holder of a share which is comprised in the property of the bankrupt, does not, in respect of that share, exceed the proportional amount available from the property of the estate of the bankrupt, after satisfaction of prior claims, for distribution among creditors of the estate, being property of the bankrupt which, at the time when demand is made for the satisfaction of the liability, is vested in the assignee.

  2. In this section, assignee means the assignee in whom the property of a bankrupt is vested pursuant to the Insolvency Act 2006.

Notes
  • Section 103(2): amended, on , by section 445 of the Insolvency Act 2006 (2006 No 55).