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"necessary" for the winding up to be commenced under
Section 228A? It is understood that the professions
generally are taking the view that this means that the
circumstances are such that, if this step is not taken,
there is a real prospect of the assets of the company
being in jeopardy or some other threat of material
prejudice to the company's creditors. In practice, the
position is not always so clear-cut and while it may
be possible to put forward good reasons for saying
that winding up is highly desirable in a particular
situation, it may be difficult to say that it is
strictly "necessary". This is particularly so in a
situation where the company concerned, perhaps a
listed company, is wholly or partly a holding
company, and it is of practical importance that
someone takes control of the group without delay and
yet there may be doubt as to whether the directors
can be advised that it is "necessary"
an absolute
test. The recommended wording of paragraph (b) makes
the test more subjective and wider.
(2) Subsection 223A(3). Delete entirely and substitute:
"(a) The directors, at the meeting where the statutory
declaration is made under subsection (1), shall
appoint as provisional liquidator a qualified
person who has consented so to act, the appointment
to be effective as at the commencement of the winding
up;
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