Receiverships
Receiverships
Receiverships is a process used as a procedure of last resort as a means of recovery.
An LPA Receiver may be used, for example, upon the failure of a property developer, whose borrowings will largely be secured on specific properties.
The Law of Property Act 1925 or Fixed Charge Receivership, most commonly known as an LPA Receivership, is a tool available to a lender to help them recover their debt on a defaulted property loan. Once implemented, the creditor assumes ownership of the debtor’s property and appoints an LPA Receiver to take charge of the property. The debt owed is recovered typically by either selling the property or collecting rental income from it.
The nature of the charge held by the lender will determine the rights and duties of any receiver should one be appointed. Prior to any decision to appoint a Receiver a lender and indeed the company concerned should explore every option available to avoid same. Fixed charges give rise to rights of action in respect of specific assets whereas fixed and floating or floating charges may have different degrees of asset cover and will entail additional responsibilities on the part of the Receiver.
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The key to a successful receivership appointment is to promptly devise a strategy to preserve and enhance asset values.
Corporate receiverships are appointments made by the holders of fixed and floating charges over corporate entities. In certain situations, receiverships involve continuing to trade the business in the short term in order to preserve and enhance the value of the assets prior to disposal.
Court-appointed Receiverships enables a person appointed to take charge of assets, usually when they are subject to some legal dispute. The procedure may be used other than for a limited company, for example, to settle a partnership dispute or in equitable execution (e.g. in a divorce)
Our experience of receiverships is extensive with appointments ranging from single companies to large groups, involving various sectors including retail, manufacturing, leisure and service industries. Our recent experience of trading receiverships includes a number of licensed premises, restaurants, retail and manufacturing businesses.
Our track record demonstrates our ability to achieve positive results for the benefit of the creditors acting in a variety of capacities