Insolvency Act 1986 s.115 – Expenses of voluntary winding up

[^F268 After the payment of any liabilities to which section 174A applies,^F268] all expenses properly incurred in the winding up, including the remuneration of the liquidator, are payable out of the company’s assets in priority to all other claims.

Definitions used in section 115 1

the company: 2 Section 233B does not apply in relation to a contract for the supply of goods or services to a company (“the company”) where any of paragraphs 3 to 11 applies.
Defined in Sch.4ZZA para.2 · see it in the full Act

Cases considering section 115 13

Regina v Jones (On Appeal from the Court of Appeal (Criminal Division))

[2002] UKHL 6 · 20 February 2002Interprets

In a voluntary winding up, expenses properly incurred are payable from company assets in priority to all other claims. Rule 4.218 determines which liabilities qualify (see paras [3]–[5]; [13]–[17]).

Buchler & Anor v Talbot & Ors

[2002] EWCA Civ 228 · 22 February 2002Interprets

Interpreted to require liquidation expenses properly incurred, including liquidators’ remuneration, to be paid out of company assets in priority to all other claims. The expression company’s assets includes property subject to a charge which, as created, was a floating charge. (see Recent authority; Conclusion)

Lewis v Commissioner of Inland Revenue & Ors

[2000] EWCA Civ 274 · 2 November 2000Interprets

Interprets section 115 as a priority provision. It determines priority against other claims but does not independently make all expenses properly incurred payable from company assets. (see paras [10]; [28]-[34])

Inland Revenue v Kahn & Anor[2000] EWCA Civ 86 · 23 March 2000
Green v Bramston & Ors[2010] EWHC 3106 (Ch) · 2 December 2010
Courts Plc (In Liquidation)[2008] EWHC 2339 (Ch) · 9 October 2008
Allders Department Stores Ltd. & Ors, Re[2005] EWHC 172 (Ch) · 16 February 2005
In the matter of the Nortel Companies[2013] UKSC 52 · 24 July 2013
Dolfin Financial UK Ltd, Re[2026] EWHC 957 (Ch) · 24 April 2026
Qureshi (Liquidator of Edgware Constitutional Club Ltd) v Association of Conservative Clubs Ltd[2019] EWHC 1165 (Ch) · 9 May 2019
Exeter City Council v Bairstow & Ors[2007] EWHC 400 (Ch) · 2 March 2007
Bezant v Cork[2006] EWHC 2126 (Ch) · 24 July 2006
Bezant v Cork[2006] EWHC 2134 (Ch) · 7 March 2006

What each judgment says about section 115 is in the case-law panel in the full Act.

Amendments and notes

3 notes from legislation.gov.uk

Amendments

F268Words in s. 115 inserted (26.6.2020) by Corporate Insolvency and Governance Act 2020 (c. 12), s. 49(1), Sch. 3 para. 9 (with ss. 2(2), 5(2))

Modifications

C310Ss. 113-115 applied (with modifications) (4.1.2024) by S.I. 2021/716, Sch. 1 para. 3 (as amended by The Payment and Electronic Money Institution Insolvency (Amendment) Regulations 2023 (S.I. 2023/1399), regs. 1(2), 20)
C312S. 115 applied (with modifications) (S.) (6.4.2001) by S.S.I. 2001/128, reg. 4(1), Sch. 2