London: +44 (0)20 7236 2601
St Albans: +44 (0)1727 869141
Rickmansworth: +44 (0) 1923 771010
Milton Keynes: +44 (0)1908 605552

CVAs and Landlords

"CVAs allow troubled companies to escape their full obligations", say landlords and other critics, according to Accountancy Age.

Such a perspective ought not to be surprising because the whole point of a CVA is to relieve the company of obligations it cannot meet - on fair terms.

The principles are that a company and its creditors are free to agree whatever they like in a CVA, provided, broadly, that 75% of those creditors who vote do in fact support the proposals and that no creditors are unfairly prejudiced.

Landlords in particular should recognise that accepting a compromise on future income and/or outstanding debt can be preferable to the loss of value to creditors on liquidation, with the consequential absence of future income (voids) and outstanding debt (unpaid rent).

 

 

Date: 23rd March, 2010
Author: Chris Laughton

SHARE THIS

Articles from this Author

Contact a Partner

Tweet

M&H Financial Planning shortlisted for Tax & Estate Planner of the Year @FinanceAwards #Tax #EstatePlannertwitter.com/i/web/status/8…

Corporate Advisory Partner @ChrisLaughton01 latest post The Recast European Insolvency Regulation(the “Recast EIR”) bit.ly/2tNkDDK

Follow

LinkedIn

For the latest Mercer & Hole news, visit our LinkedIn page mercer-&-hole

Click here to follow us on LinkedIn