A Winding Up Petition is usually filed in court by a disgruntled creditor who feels that liquidating your company represents his best chance of receiving payment, or at least some payment, from your company. It is the second of the typical 3-step sequence to a hostile liquidation of your company. It is an extremely serious matter and needs to be dealt with immediately. Time is of the essence here.

A Winding Up Petition is probably the most serious existential threat that a company can be exposed to. If the petition succeeds, the company will be placed into compulsory liquidation and will cease to exist. There is a fixed procedure and timetable for the various steps involved, and it pays to understand the process. It is also highly advisable for a company so threatened to urgently seek the advice of a licensed insolvency practitioner. The sooner this happens, the greater the likelihood of a satisfactory outcome.

A Winding Up Petition is an extremely serious matter and is often taken as a final option by a creditor who has been unable to obtain payment from your company. There is little time remaining before the court hears the petition and the claimant’s grounds for bringing the action. If the company does not respond with a strong case for obtaining a stay or an injunction, then the court will issue a winding up order on the same day of the petition hearing. At that point, the company is in the hands of the Official Receiver and no longer owned by its owners or managed by its directors. However, there may be grounds for preventing the court from issuing a Winding Up Order when the petition comes before it for a hearing.

The short answer is Yes but it is important to understand the limitations of this action. It may help to better understand what exactly a Winding Up Petition is and how the situation developed to the stage where the company was served with one.

A winding up petition is a form of legal notice. Put to the court by a creditor, this notice communicates a creditor’s belief that a company is insolvent, and requests the liquidation of that company for the purposes of paying its debt to the creditor who has issued the notice.