The court may, in the event of the assets being insufficient to satisfy the liabilities, make an order as to the payment out of the assets of the expenses incurred in the winding up in such order of priority as the court thinks just.
Cases considering section 156 8
Regina v Jones (On Appeal from the Court of Appeal (Criminal Division))
The section confers a limited discretion to rearrange the priorities of listed liquidation expenses among themselves. It does not determine whether a liability is an expense (see paras [16]; [38]).
Lewis v Commissioner of Inland Revenue & Ors
Limits section 156 to the court’s power to rearrange the priority of winding-up expenses where assets are insufficient. It was not treated as establishing an automatic right to recoup litigation costs. (see paras [11]; [24]; [32]; [41])
Digital Equipment Company Ltd & Ors v Bower & Ors
Section 156 permits reordering of the expenses incurred in a compulsory winding up, meaning the expenses listed in rule 4.218(1). It does not permit alteration of the priority of costs ordered against a company or its liquidators in litigation. (see paras [10]–[19])
- Bloom & Ors v The Pensions Regulator & Ors
- Buchler & Anor v Talbot & Ors
- Inland Revenue v Kahn & Anor
- Rohl v Bickland Ltd
- Exeter City Council v Bairstow & Ors
What each judgment says about section 156 is in the case-law panel in the full Act.
Amendments and notes
3 notes from legislation.gov.uk
Modifications
- C436S. 156 restricted (6.3.2008) by The Regulated Covered Bonds Regulations 2008 (S.I. 2008/346), reg. 46, Sch. para. 2(3)
- C437S. 156 applied (with modifications) (17.2.2009 for certain purposes, otherwise 21.2.2009) by Banking Act 2009 (c. 1), ss. 103, 263(1)(2) (with s. 247); S.I. 2009/296, arts. 2, 3, Sch. para. 2
- C438S. 156 applied (with modifications) (6.6.2013) by The Collective Investment in Transferable Securities (Contractual Scheme) Regulations 2013 (S.I. 2013/1388), Pt. 3 reg. 1, Sch. 2 paras. 3, 5 Table (with reg. 24)