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Companies Act 1993

Voluntary administration - Administrator's liability and indemnity for debts of administration

239ADM: Administrator's right of indemnity has priority over other debts

You could also call this:

“Administrator's repayment rights come before most other company debts”

If you’re an administrator of a company, you have the right to be paid back for any costs or expenses you have while doing your job. This right is called ‘indemnity’. Your right to be paid back is more important than most other debts the company owes. It comes before any unsecured debts, which are debts that aren’t backed by specific company property. It also comes before some secured debts, which are described in another part of the law called Schedule 7. However, there’s one exception to this rule, which is explained in section 312 of the Companies Act. This section says that some other payments, like wages owed to employees, might come before your right to be paid back.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM321624.

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“Administrator's right to company property to ensure repayment”

Part 15A Voluntary administration
Administrator's liability and indemnity for debts of administration

239ADMAdministrator's right of indemnity has priority over other debts

  1. Subject to section 312, the administrator's right of indemnity under this subpart has priority over—

  2. all the company's unsecured debts; and
    1. debts of the company secured by a charge of the kind described in clause 2(1)(b) of Schedule 7.

      Compare
      • Corporations Act 2001 s 443E (Aust)
      Notes
      • Section 239ADM: inserted, on , by section 6 of the Companies Amendment Act 2006 (2006 No 56).