Administrative receivers are appointed by secured creditors with a view to selling assets and maximising their recovery under their security, which is normally a debenture.
There is some commonality between administrative receivership and an administration process; however, an administrative receiver’s duty of care is to his appointor, the secured creditor, not to creditors generally.
A debenture provides fixed and floating charge security to a lender, which provides the lender with comfort that its security extends over the company’s assets and undertaking in the event of default.
If you are in default with your lender, and your lender has commenced the demand process, it is highly advisable to contact our expert insolvency practitioners urgently, to discuss the options available to you.
An LPA receiver, who is appointed under the Law of Property Act 1925, is appointed over a specific fixed charge that attaches to a specific asset. The receiver has more limited powers, which results in them being unable to deal with the business and its assets generally.
LPA receivership is not a formal insolvency process and should not be confused with an administrative receivership. An LPA receiver is normally appointed over a property, by a mortgage lender, when default has occurred on the loan repayment.
At Smith Cooper, we have a good relationship with clearing banks and asset-based lenders whose support is necessary on these specific appointments.
Dean Nelson, Nicholas Lee, Andrew Stevens and Michael Roome are all licensed in the United Kingdom to act as insolvency practitioners by the Institute of Chartered Accountants in England and Wales. They are bound by the insolvency code of ethics, which can be found here.
When acting as receivers, administrative receivers or administrators, they act as agents only, without personal liability, and when acting as administrators, the affairs, business and property of the company are being managed by them.