Company Voluntary Arrangements (CVAs) - Law - CVA with a moratorium
Schedule A1 - Insolvency Act 1986 - Paragraph 26 - Challenge of nominee's actions in the CVA Moratorium period
The actions of the insolvency practitioner acting as the Nominee in a Company Voluntary Arrangement (CVA) moratorium period may also be challenged. Any challenge must be made by way of an application to courrt - in order that the court might consider the matter overall.
The actual wording of Paragraph 26 of Schedule A1 to The Insolvency Act 1986 is reproduced below in bold.
26. (1) If any creditor, director or member of the company, or any other person affected by a moratorium, is dissatisfied by any act, omission or decision of the nominee during the moratorium, he may apply to the court.
(2) An application under sub-paragraph (1) may be made during the moratorium or after it has ended.
(3) On an application under sub-paragraph (1) the court may—
(a) confirm, reverse or modify any act or decision of the nominee,
(b) give him directions, or
(c) make such other order as it thinks fit.
(4) An order under sub-paragraph (3) may (among other things) bring the moratorium to an end and make such consequential provision as the court thinks fit.
So it is not only company directors who have to be careful in the CVA moratorium period but also the Nominee. If a court challenge is made (under Paragraph 26 of Schedule A1) about the Nominee's actions in the moratorium period the court may make such order as it sees fit.