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Companies Act 1993

Voluntary administration - Protection of company's property during administration

239ABH: Duties of court officer in relation to company's property

You could also call this:

“Court officers' responsibilities when handling a company's property during administration”

When a company is in administration, court officers have special rules to follow. If you’re a court officer like a sheriff or registrar, you need to know these rules.

If you get a written notice that a company is in administration, you can’t sell the company’s property or give money from the company to anyone except the administrator. This includes money from selling property, money that was taken from the company, or money paid to stop property from being taken.

You also can’t do anything about debts owed to the company or give money from these debts to anyone except the administrator.

If you have any of the company’s property, you need to give it to the administrator. You also need to give the administrator any money you have from selling property or from debts owed to the company.

The costs of taking the property or dealing with the debts are paid first from the property or money you give to the administrator. You can keep enough money to cover these costs.

The court can sometimes allow you to do things that you normally wouldn’t be allowed to do during administration.

If someone buys property from the company during this time and they didn’t know about these rules, they still get to keep the property.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM321560.

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“No legal actions can take company property during administration without court approval”

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“Company in voluntary administration treated as if bankruptcy proceedings have started”

Part 15A Voluntary administration
Protection of company's property during administration

239ABHDuties of court officer in relation to company's property

  1. This section applies to a court officer, that is, a sheriff or registrar or other appropriate officer of the court, who receives written notice that a company is in administration.

  2. During the administration, the court officer must not—

  3. take action to sell property of the company under an execution process; or
    1. pay to a person (other than the administrator)—
      1. proceeds of the sale of the company's property (at any time) under an execution process; or
        1. money of the company seized (at any time) under an execution process; or
          1. money paid (at any time) to avoid seizure or sale of property of the company under an execution process; or
          2. take action in relation to the attachment of a debt due to the company; or
            1. pay to any person (other than the administrator) money received because of the attachment of a debt due to the company.

              1. The court officer must deliver to the administrator any property of the company that is in the court officer's possession under an execution process (whenever begun).

              2. The court officer must pay to the administrator all proceeds or money of a kind referred to in subsection (2)(b) or (d) that—

              3. are in the court officer's possession; or
                1. have been paid into the court and have not since been paid out.

                  1. The costs of the execution or attachment are a first charge over property delivered under subsection (3) or proceeds or money paid under subsection (4).

                  2. In order to give effect to a charge under subsection (5) on proceeds or money the court officer may retain, on behalf of the person entitled to the charge, so much of the proceeds as the court officer thinks necessary.

                  3. The court may, if it is satisfied that it is appropriate to do so, permit the court officer to take action, or make a payment, that subsection (2) would otherwise prevent.

                  4. A person who buys property in good faith under a sale under an execution process obtains a good title to the property as against the company and the administrator, despite anything else in this section.

                  Compare
                  • Corporations Act 2001 s 440G (Aust)
                  Notes
                  • Section 239ABH: inserted, on , by section 6 of the Companies Amendment Act 2006 (2006 No 56).