The sequence
- Statutory demand. A written demand for an undisputed debt. You have 21 days to pay it, settle it, or apply to set it aside if the debt is genuinely disputed.
- Petition presented. The creditor asks the court to wind the company up.
- Advertised in the Gazette. This is the point it becomes critical. Banks monitor the Gazette and will normally freeze the company’s accounts on seeing it.
- Hearing. The court makes a winding-up order or dismisses the petition.
- Official Receiver appointed. Control leaves the directors entirely.
The bank account problem
Once a petition has been presented, payments out of the company’s account can be reversed if a winding-up order is later made — including ordinary payments to suppliers and staff. In practice the bank freezes the account and the business stops. Continuing to trade through it without going to court first causes serious problems for everybody involved.
What you can still do
Before advertisement: pay or settle the debt, apply to set aside the demand if the debt is genuinely disputed, negotiate with the petitioning creditor, or move into administration or a CVL. All of this needs to happen immediately.
After advertisement: options narrow sharply. Even if you pay the original creditor, others can substitute themselves as petitioner.
Where we stand
If a petition has been presented against your company, a sale is almost never available and we will normally decline. What you need is a licensed insolvency practitioner, today rather than this week. We will say so and point you in the right direction.