Receivership
Nature
Receivers & Managers are generally appointed as independent persons to collect or make safe income or assets or both, usually for the purpose of realisation on behalf of a particular creditor who holds a charge over the company, or to protect the contractual rights of the parties. If a Receiver & Manager is appointed to enforce a debenture, for example, the Receiver & Manager collects and sells the property secured by the debenture on behalf of the debenture holder and distributes the proceeds to it.
Who Can Appoint
The appointment of a Receiver and Manager is most commonly made by a secured creditor who holds either a fixed or fixed and floating charge over the assets and undertaking of a company. A Receiver & Manager may also be appointed by the Court.
Timing
A secured creditor may appoint a Receiver & Manager to a company after a reasonable time has been given to the company to comply with a Notice of Demand for payment of the debt and the company has not complied within the time. In practice, if it is not specified in the charge documents, the time allowed is usually one week.
