Plain language law

New Zealand law explained for everyone

Companies Act 1993

Liquidations - Duties, rights, and powers of liquidators

263: Restriction on enforcement of lien over documents

You could also call this:

“Limits on keeping company documents as security for unpaid debts during liquidation”

When a company is being liquidated, you can’t claim or enforce a lien (a right to keep possession of something until a debt is paid) over the company’s books, records, or documents against the liquidator.

If you provided services to the company before the liquidation started and have a lien because of that, you can make a preferential claim. This claim can be for up to 10% of what you’re owed, but no more than $2,000.

These rules don’t apply in some special cases. If the company was put into liquidation under certain conditions in section 241, and section 243A applies to the company, but section 244 doesn’t, then these restrictions on liens don’t apply.

This text is automatically generated. It might be out of date or be missing some parts. Find out more about how we do this.

View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM321926.

Topics:
Business > Industry rules
Business > Fair trading
Money and consumer rights > Banking and loans
Previous

262: Documents in possession of receiver, or

“Receiver must allow liquidator access to company documents while retaining possession”

Next

264: Delivery of document creating charge over property, or

“ Documents creating a legal claim over company property must be given to the liquidator ”

Part 16 Liquidations
Duties, rights, and powers of liquidators

263Restriction on enforcement of lien over documents

  1. A person is not entitled, as against the liquidator of a company, to claim or enforce a lien over books, records, or documents of the company.

  2. If the lien arises in relation to a debt for the provision of services to the company before the commencement of the liquidation, the debt is a preferential claim against the company under section 312 to the extent of 10% of the total value of the debt, up to a maximum amount of $2,000.

  3. Nothing in this section applies to a company that was put into liquidation pursuant to paragraph (a) or paragraph (b) of subsection (2) of section 241 if—

  4. section 243A applies to the company; and
    1. section 244 does not apply in relation to the company.

      Notes
      • Section 263(2): amended, on , by section 13 of the Companies Amendment Act 2006 (2006 No 56).
      • Section 263(3)(a): replaced, on , by section 44 of the Insolvency Practitioners Regulation (Amendments) Act 2019 (2019 No 28).