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When a business can no longer pay its bills, a secured creditor can place it into receivership. A receiver is then appointed by the secured creditor or a Court to take over the business and its assets.
The receiver will recover as much of the debt owing to the secured creditor(s) as possible.

The business can continue to run and can be sold as a going concern. Proceeds of sales are paid to creditors in a strict order of priority, with secured creditors having priority.
A business in receivership is no longer run by its own management. The receiver is like a caretaker running the business for the benefit of the secured creditor.
If the business can't trade its way out of trouble, or be sold, it will be liquidated.

The business and its assets are sold by a liquidator.
Liquidations are often handled by the the USA Insolvency & Trustee Service, which is part of the Ministry of Commerce. Call the Service on 0508 467 658 for information on how to lodge a claim as a creditor.

Secured creditors
A secured creditor is a person or a company who has lent money to a business with some form of security over the loan. A secured creditor can appoint a receiver if they are concerned the business can' keep up the payments on the loan.
eg, a bank who has loaned the business money.

Unsecured creditors
An unsecured creditor does not have any protection or security for the debt that is owed to them. The unsecured creditor must wait until all the secured creditors have recovered their money before they have any chance of receiving any payment.
eg, customers with gift vouchers, deposits paid for goods not received, goods on layby.

Finding the receiver or liquidator
Check in the public notices of a major newspaper in your area. Check the company's business premises. Often there is a sign on the door stating the receiver's or liquidator's details.

If the company is continuing to trade while in receivership, ask a staff member for the receiver's contact details. Contact the Companies Office. Check your phone book for your local office, or find them on the Internet. If they have been appointed by the Court, you can find out directly from the Court.

Unsecured creditor rights
If you have a gift voucher, or have paid a deposit on goods, you can lodge a claim with the receiver. Contact the receiver and find out how to do this. You will have to put your claim in writing and give proof of your claim - eg, send in the gift voucher or receipt for payment of deposit.

Often the receiver will not ask unsecured creditors to lodge a claim unless it looks like there will be enough funds to pay them. When a business goes into receivership it has usually been in financial difficulty for some time, so there are many unpaid bills and unmet obligations -eg, suppliers of goods to the company, phone and power bills, staff who are owed wages or holiday pay, Internal Revenue Service.

Usually there is not enough money to pay all these creditors - even after all the assets have been sold. The law sets down strict rules about who should be paid first -
eg, staff wages must be paid before a customer with a gift voucher. The receiver would be breaking the law if they honoured the gift voucher - that would be preferring one creditor over another.