Plain language law

New Zealand law explained for everyone

Companies Act 1993

Voluntary administration - Execution and effect of deed of company arrangement

239ACO: Execution of deed

You could also call this:

“How a company signs a deed of arrangement during voluntary administration”

When a company is in voluntary administration, it can make an agreement called a deed of company arrangement. This deed becomes official when both the company and the person in charge of the deed (called the deed administrator) sign it.

You have a certain amount of time to get the deed signed. Usually, you have 15 working days after the meeting where the deed was approved. But if you need more time, the deed administrator can ask a court for extra time. They must do this before the first 15 working days are up.

Before the company can sign the deed, the company’s board must agree to it. They need to make an official decision allowing the deed to be signed for the company.

Even though the administrator of the company usually has the power to do things for the company, in this case, they can’t sign the deed without the board’s approval. This rule doesn’t change any of the administrator’s other powers or jobs.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM321597.

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239ACN: Preparation and contents of deed, or

“Rules for creating a document that sets out how a company in voluntary administration will pay its debts”

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239ACP: Procedure if deed not fully approved at watershed meeting, or

“What happens when a deed of company arrangement isn't fully approved at the watershed meeting”

Part 15A Voluntary administration
Execution and effect of deed of company arrangement

239ACOExecution of deed

  1. The deed is a deed of company arrangement when it is executed by both the company in administration and the deed administrator.

  2. The deadline for the execution of the deed by the company and the deed administrator is—

  3. 15 working days after the watershed meeting has approved it; or
    1. the further time that the court allows, if the deed administrator has applied to the court for an extension before the end of the initial period of 15 working days after approval.

      1. The company may not execute the deed unless the board of the company has, by resolution, authorised the deed to be executed by the company or on its behalf.

      2. Subsection (3) has effect despite section 239X, but does not limit the functions and powers of the administrator of the company.

      Compare
      • Corporations Act 2001 s 444B (Aust)
      Notes
      • Section 239ACO: inserted, on , by section 6 of the Companies Amendment Act 2006 (2006 No 56).