Plain language law

New Zealand law explained for everyone

239: Application of section 233
or “Rules for compromises approved under section 236”

You could also call this:

“This part explains how to help struggling companies survive or wind down fairly”

This part of the law is about helping companies that are having money problems or might have money problems in the future. The main goals are:

To try and keep the company, or as much of its business as possible, running.
If the company can’t keep going, to make sure the people and businesses it owes money to (creditors) and its shareholders get more money back than they would if the company closed down right away.

These goals are meant to give the company a chance to sort out its problems and possibly recover, or if that’s not possible, to get the best outcome for everyone involved.

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Next up: 239B: Interpretation of some key terms

or “Definitions of key terms used in company administration”

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Companies Act 1993
Voluntary administration
239A: Objects of this Part

Part 15A Voluntary administration
Preliminary

239AObjects of this Part

The objects of this Part are to provide for the business, property, and affairs of an insolvent company, or a company that may in the future become insolvent, to be administered in a way that—
maximises the chances of the company, or as much as possible of its business, continuing in existence; or
if it is not possible for the company or its business to continue in existence, results in a better return for the company's creditors and shareholders than would result from an immediate liquidation of the company.

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