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The role and functions of a Liquidator

A liquidator must be a licensed insolvency practitioner and authorised by a recognised professional body or the Secretary of State.

In basic terms, a liquidator’s function is to secure the assets of the company and ensure that they are realised and distributed to the company’s creditors and, if there is any Surplus, to the company’s contributories. A liquidator must fulfil this function following the duties imposed and powers granted to them under the Insolvency Act 1986 (IA 1986) and the Insolvency (England and Wales) Rules 2016 (IR 2016), SI 2016/1024.

Liquidators have a duty to act in the interests of creditors and contributories generally and as such must exercise a high standard of care and skill. They must always act impartially and independently.

A liquidator acts as an agent on behalf of the company, although in a somewhat different way to a standard agent in that this agent directs the principal as well as acts for it. The liquidator does not stand in the shoes of the company