Fixed Charge: Where a creditor has ‘loaned’ monies to a company, it may wish to take a “fixed charge” over a specific asset. The asset is then “signed over” to the lender so the debtor cannot do anything with the asset without the permission of the lender.
Floating Charge: Similar to fixed charges, a Floating Charge is a security afforded to a lender over assets that are constantly changing in identity and value (such as stock, cash, fixtures, and fittings etc.). Floating Charges are mainly associated with companies and not individuals.
Freezing Order: A freezing order (formally known as Mareva Injunction) is a court order that prevents parties disposing of their assets during legal proceedings.
Guarantee: A guarantee is a commitment that a third party will repay a debt in the event that the original borrower fails to do so.
High Court: Her Majesty’s High Court of Justice in England is one of the senior courts of England and Wales. The High Court is a court of unlimited civil jurisdiction and comprises three separate divisions: the Queen’s Bench, Chancery, and the Family Division. The High Court generally deals with higher value claims than the County Court.
High Court Enforcement Officer: Private individual or company, licensed to work under High Court Writs to recover money and possessions from a debtor. Similar to a bailiff but can only act on debts of £600 or more.
Individual Voluntary Arrangement (IVA): Legally binding arrangement supervised by a licensed Insolvency Practitioner. The purpose of an IVA, similar in nature to a CVA, is to enable an individual to reach a compromise with their creditors and avoid the consequences of bankruptcy.
Injunction: Court order that prevents a party from doing something, or compels a party to do something
Insolvency: Insolvency is the condition of having insufficient assets with which to discharge debts and liabilities. In short, the debtor is unable to pay their debts as they fall due.
Insolvency Rules: The Insolvency Rules 1986 are a statutory instrument that sets out the detailed working procedures for the provisions of the Insolvency Act 1986.
Insolvency Practitioner: Individual who is licensed and authorised to act in relation to the affairs of an insolvent individual, partnership, or company.
Interim Order: Order that will stay in place until it is either made final at a hearing or set aside (by the court or by consent).
Judgment: A final decision by a court or other tribunal.
Jurisdiction: The geographical area that a given set of laws govern. In a contract, parties will generally agree which court system will oversee any dispute that may arise. This does not have to be the country/area that the contract is performed, or where the parties are based.
Late Payment of Commercial Debts (Interest) Act 1998: Piece of legislation that was introduced to give businesses a statutory right to claim interest from other businesses for the late payment of commercial debts.
Letter Before Action: Letter Before Action (also known as a letter before claim) is generally seen as the last letter sent by a creditor to a debtor before legal action is taken to recover a debt.