Purnells

	Two types of CVA
	what are the two types? why two types? who can apply for a new type of CVA? are their different rules? when would an old type CVA be used? when would a new type of CVA be used?
	Old type CVA - No Moratorium the limbo period nominees duties disclosure issues directors duties the proposal impact of proposal on various parties
	New type CVA - With Moratorium enormous power enormous responsibility disclosure issues impact of proposal nominees duties creditors meeting voting rights supervisors duties a typical proposal costs concluding the CVA banks and debenture holders landlords petitioning creditors preferential creditors unsecured creditors
	Table of differences table to show the differences between the two types of CVA?
	Administration Order v CVA when would administration be sought rather than take up a new type CVA?
	Case Studies case study 1 case study 2 case study 3

___

With power comes responsibility. Directors do not obtain the freeze on creditors actions without having to exercise increased levels of responsibility. The objective is to ensure that creditors are not abused in the moratorium period.

Directors may be fined, or for some of the following offences, imprisoned for default such as:

not recording on every invoice, letterhead, order etc. The fact that a moratorium is in force..
obtaining credit of more than £250 without informing the person from whom credit is taken that a moratorium is in force.
disposing of company assets in circumstances which do not constitute the ordinary course of business of the company.
paying certain pre moratorium creditors.
without appropriate consent disposing of assets subject to hire purchase or other security.

It is not only the directors who have greater responsibility in the moratorium period - the nominee also has to have a greater involvement in "monitoring of the company's activities".