ABSTRACT
Anyone dealing with a person or company against whom a petition for winding up or bankruptcy has been presented does so at their peril. If the court decides to make the requested bankruptcy or winding up order, any payments or dispositions of property19 after the presentation of the petition will be void unless made with the consent of the court or subsequently ratified by the court. Section 127 of the Insolvency Act 1986 provides that any disposition of property or transfer of shares or alteration of the status of members will be void after the commencement of a winding up. The winding up will, once the order has been made, be deemed to have commenced with the presentation of the petition. Section 284 of the Insolvency Act 1986 provides for dispositions by the bankrupt to be void if made during the period beginning with the presentation of the petition and ending with the vesting of the estate in the trustee.20 One major difference in the drafting of the two sections is that s 127 merely refers to dispositions without specifying any particular disponor; in Re J Leslie Engineers,21 the court held that it was immaterial under s 127 whether the disposition was by the company or by a third party. Another difference is that s 127 makes no reference to the consequences of the voidness (leaving it to the general law), whereas s 284 is more specific. Guidance as to when consent will be given can be derived from the cases, most of which have arisen in the context of a compulsory liquidation22 rather than bankruptcy.
