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312: Preferential claims
or “How certain claims are prioritised and paid when a company is being liquidated”
You could also call this:

“How leftover money is paid out after settling priority debts”

After paying the preferential claims as outlined in section 312, the liquidator must use the company’s assets to pay all other claims. These other claims are treated equally and should be paid in full. If there isn’t enough money to pay all the claims, they will be reduced by the same percentage.

If a creditor agrees to accept a lower priority for their debt before the liquidation starts, this agreement will still be respected.

After paying all the claims, if there’s any money left over, the liquidator must distribute it according to the rules in the company’s constitution. If the company doesn’t have a constitution or if it doesn’t say how to distribute leftover money, then the liquidator will follow the rules in this Act.

Remember, all of this is subject to section 311, which has additional rules about paying claims.

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Next up: 314: Meetings of creditors or shareholders

or “Requesting and holding meetings during liquidation for creditors and shareholders”
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Part 16 Liquidations
Creditors' claims

313Claims of other creditors and distribution of surplus assets

  1. After paying preferential claims in accordance with section 312, the liquidator must apply the assets of the company in satisfaction of all other claims.

  2. The claims referred to in subsection (1) rank equally among themselves and must be paid in full, unless the assets are insufficient to meet them, in which case payment shall abate rateably among all claims.

  3. Where, before the commencement of a liquidation, a creditor agrees to accept a lower priority in respect of a debt than that which it would otherwise have under this section, nothing in this section prevents the agreement from having effect according to its terms.

  4. Subject to section 311, after paying the claims referred to in subsection (1), the liquidator must distribute the company's surplus assets—

  5. in accordance with the provisions contained in the company's constitution; or
    1. if the company's constitution does not contain provisions for the distribution of surplus assets or, if the company does not have a constitution, in accordance with this Act.