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Companies Act 1993

Liquidations - Creditors' claims

311: Interest on claims

You could also call this:

“How interest is calculated and paid on claims during company liquidation”

When a company is being liquidated, you can include interest on your claim up to the day the liquidation starts. The interest rate can be what’s in your contract or, if it’s a court judgment, the amount payable on the judgment debt.

If there’s money left after paying all accepted claims, you’ll get more interest. This extra interest covers the time from when the liquidation started until your claim is paid. If there isn’t enough money to pay all the interest in full, everyone will get a fair share.

If there’s still money left after paying that interest, you might get even more interest. This extra amount would be the difference between the interest you’ve already received and what your contract says you should get. Again, if there’s not enough to pay everyone in full, you’ll get a fair share.

The interest rate used for these calculations is set out in Schedule 2 of the Interest on Money Claims Act 2016.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM322802.

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310O: Transactions under recognised multilateral netting agreement not affected by variation or revocation of declaration under section 310K, or

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312: Preferential claims, or

“How certain claims are prioritised and paid when a company is being liquidated”

Part 16 Liquidations
Creditors' claims

311Interest on claims

  1. The amount of a claim may include interest up to the date of commencement of the liquidation—

  2. at such rate as may be specified or contained in any contract that makes provision for the payment of interest on that amount; or
    1. in the case of a judgment debt, of the amount that is payable on the judgment debt.

      1. If any surplus assets remain after the payment of all admitted claims, the specified interest must be paid on those claims from the date of commencement of the liquidation to the date on which each claim is paid, and if the amount of the surplus assets is insufficient to pay interest in full on all claims, payment shall abate rateably among all claims.

      2. If any surplus assets remain after the payment of specified interest in accordance with subsection (2), interest must be paid, on all admitted claims referred to in subsection (1)(a), of an amount equal to the difference between the specified interest paid under subclause (2) and the interest that would have been payable under the contract for that period and, if the amount of the surplus assets is insufficient to pay interest in full on all those claims, payment must abate rateably among them.

      3. For the purpose of subsection (2), specified interest means interest calculated in accordance with Schedule 2 of the Interest on Money Claims Act 2016.

      Notes
      • Section 311(1): amended, on , by section 16 of the Companies Amendment Act 1999 (1999 No 19).
      • Section 311(1)(b): amended, on , by section 29 (transitional provision applies, see Schedule 1 clause 6) of the Interest on Money Claims Act 2016 (2016 No 51).
      • Section 311(2): amended, on , by section 29 (transitional provision applies, see Schedule 1 clause 6) of the Interest on Money Claims Act 2016 (2016 No 51).
      • Section 311(3): replaced, on , by section 29 (transitional provision applies, see Schedule 1 clause 6) of the Interest on Money Claims Act 2016 (2016 No 51).
      • Section 311(4): replaced, on , by section 29 (transitional provision applies, see Schedule 1 clause 6) of the Interest on Money Claims Act 2016 (2016 No 51).