Liquidation, which is also known as winding up, is the most common form of insolvency procedure. Liquidation is the end of the road for the partnership as it ceases to exist
If you and your partners have made a decision to cease trading as you do not believe the partnership business is viable and would therefore like to wind up the company, we would urge you to take a step back and make sure that this major decision is the right one.
Contact our offices where we will be pleased to provide you with the best advice on the best way forward for your business and all the options that may be available to you.
Essentially, the partnership business can be wound up in two ways:
1) Compulsory Liquidation (Creditor's Petition)
Any of your creditors can petition to the court to wind up the partnership. They may not issue any bankruptcy petitions against the partners individually, but are able to issue a bankruptcy petition against one or more of the partners individually.
2) Voluntary Liquidation (Partner's Petition)
The partners themselves can apply to the court to wind up the partnership and also have the option of issuing a bankruptcy petition against the individual partners.