It can take account of personal relationships of mutual trust and confidence in small parties, particularly, for example, where there is a breach of an understanding that all of the members may participate in the business, Upon hearing the application, the court may either dismiss the petition, or make the order for winding-up.
The court may dismiss the application if the petitioner unreasonably refrains from an alternative course of action.
In addition, the term "liquidation" is sometimes used when a company wants to divest itself of some of its assets.
This is used, for instance, when a retail establishment wants to close stores.
A creditors’ voluntary liquidation (CVL) is a process designed to allow an insolvent company to close voluntarily.
The decision to liquidate is made by a board resolution, but instigated by the director(s).
This is usually the case in bankruptcy liquidations.
Creditors are always senior to shareholders in receiving the corporation's assets upon winding up.
Closing a business and liquidating assets can be a very complicated procedure subject to many laws and regulations.
You should speak with an attorney or certified public accountant that specializes in business closures.
Voluntary liquidation occurs when the members of a company resolve to voluntarily wind up its affairs and dissolve.