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Companies Act 1993

Voluntary administration - Rights of secured creditor, owner, or lessor

239ABO: Court may limit powers of secured creditor, etc, in relation to property subject to charge

You could also call this:

“Court can restrict actions of those with rights over a company's property during administration”

If you are a company in administration, or if an administrator is appointed to your company later, this section may apply to you. It’s about what happens when someone with a right over your company’s property (like a bank that lent you money) tries to take action to enforce that right.

The court can step in and limit what this person can do. If the administrator asks, the court might tell the person they can’t do certain things or use certain powers, except in ways the court allows.

But the court will only do this if it believes that what the administrator wants to do will properly protect the interests of the person with the right over your property.

If the court does make an order like this, it only applies while your company is in administration. The order can override some other rules about what people with rights over your property can usually do.

This section doesn’t apply in all cases, though. If another part of the law (section 239ABL) applies to your situation, then this section doesn’t.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM321568.

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239ABN: Charge over perishable property, or

“Special rules for handling perishable property under charge during company administration”

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239ABP: Giving notice under security agreement, or

“Notices under security agreements still allowed despite other rules”

Part 15A Voluntary administration
Rights of secured creditor, owner, or lessor

239ABOCourt may limit powers of secured creditor, etc, in relation to property subject to charge

  1. This section—

  2. applies if,—
    1. for the purpose of enforcing a charge over property of a company, the secured creditor, a receiver, or other person does an act of a kind referred to in section 239ABM(1); and
      1. the company is in administration when the secured creditor, receiver, or other person does that act, or an administrator is later appointed to the company:
      2. does not apply in a case where section 239ABL applies.

        1. On an application by the administrator, the court may order the secured creditor, receiver, or other person not to perform specified functions or exercise specified powers, except as permitted by the order.

        2. The court may make an order only if satisfied that what the administrator proposes to do during the administration will adequately protect the secured creditor's interests.

        3. An order—

        4. may be made only, and has effect only, during the administration; and
          1. has effect despite section 239ABM and 239ABN.

            Compare
            • Corporations Act 2001 s 441D (Aust)
            Notes
            • Section 239ABO: inserted, on , by section 6 of the Companies Amendment Act 2006 (2006 No 56).