Jurisdiction(s):
United Kingdom

Related legal acts

Key definition

Insolvency definition

What does Insolvency mean? In practice, insolvency describes a financial state where a debtor cannot meet liabilities when due, triggering remedies such as administration, liquidation or bankruptcy and informing directors’ duties and avoidance claims. For companies in England & Wales, Scotland and Northern Ireland, the Insolvency Act 1986, s 123 sets two alternative tests: - Cash‑flow insolvency: an inability to pay debts as they fall due. The inquiry is practical and forward‑looking, not confined to today’s bills (Re Patrick & Lyon Ltd [1933] Ch 786; BNY Corporate Trustee Services Ltd v Eurosail [2013] UKSC 28). - Balance‑sheet insolvency: liabilities (including contingent and prospective liabilities) exceed assets on...

Compulsory winding-up by creditor’s petition in England and Wales: pre-issue checks, service, Gazette notice, hearings and orders

Published by a LexisNexis Restructuring & Insolvency expert

Practice notes

Practice Note

This Practice Note sets out the applicable practice and procedure that applies to the winding up of a company (the debtor) pursuant to a creditors’ winding-up petition.

The most frequent circumstances in which such a petition is presented are as follows:

a creditor has served a statutory demand on the debtor and, after the 21-day period has lapsed, the company has not paid, secured, or compounded the amount due (see Practice Note: Company statutory demand)...

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Karl Anderson

Barrister, 4 Stone Buildings

Described as a “charming and first rate junior who produces written work of exceptional quality” and as an “excellent tactician” with a “formidable intellect” who “adds great fire power to any legal team”, Karl maintains a broad commercial practice. He is ranked in the Legal 500 as a ‘Leading Junior’ in Banking and Finance (Band 3), Insolvency (Band 4), and Civil Fraud (Band 4), and in Chambers and Partners as ‘Up and Coming’ in Company and Civil Fraud. Karl has extensive experience as a High Court trial advocate. Described as a “skilled and efficient cross-examiner” who “holds his own as an advocate” and who “has a fine delivery style and builds up a nice rapport with judges”, Karl has conducted multiple trials as sole counsel. In addition, Karl is regularly instructed as part of a larger counsel team in complex and high value claims in both the...

Web page updated on 21/05/2026

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