Insolvency Made Clear: A Guide for Debtors

Insolvency Law Made Clear – A Guide For Debtors
A ‘company voluntary arrangement’ (CVA) is the formal process which, if 75%
of creditors agree, can lead to the debt of a company being reduced or the company
being given more time to pay.
‘Corporate’ is an adjective, and it means ‘of a company’.
‘Costs’ refer to the lawyers’ fees, court fees and other fees to bring or defend a claim.
The ‘court’ is a polite way of referring to the judge who is in charge of making
decisions in a case.
‘Credit rating agencies’ are companies which assess how likely it is that someone
can afford to repay a debt. They work behind the scenes. Professional lenders
will almost certainly check an individual’s credit rating with an agency before
agreeing to a loan.
A ‘creditor’ is someone who is owed a debt. For example, if a bank makes a loan
to an individual the bank will be a creditor.
A ‘creditors’ voluntary arrangement’ (CVA) is a process where creditors agree to
restructure the debts of an insolvent company. See Chapter 12.
A ‘debt relief order’ (DRO) is a type of streamlined bankruptcy which only applies
for debtors who have few assets and small debts.
A ‘debtor’ is someone who owes a debt.
To ‘default’ on a loan is not to repay it on time.
A ‘directions hearing’ is a court hearing which aims to make orders about the
conduct of the case rather than to determine its outcome. For example, it might
set a timetable for the exchange of evidence.
‘Directors’ are those individuals who are responsible for running a company in
the eyes of the law. They do not need to have the job title ‘director’, and they are
(or should be) listed in Companies House. Some but not everyone who has the
title ‘director’ is a director for the purposes of this book: only those with a particular
legal role with the company are directors. The rest are senior employees
of the company.
The ‘discharge’ of bankruptcy is when the bankruptcy order ends.
A company is ‘dissolved’ after the process of liquidation is finished: it is struck
off the list of companies in Companies House. Whatever assets remain become
the property of the Queen (‘bona vacantia’).
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