Following the first article in this series dealing with the
process of a member's voluntary winding up (the
"MVWU"), the focus of this article will shift to the
second mode of voluntary winding up which is the creditor's
voluntary winding up (hereinafter "CVWU") under the
Companies Act, Chapter 386 of the Laws of Malta (the
"Act").
Since there is some overlap between a MVWU and CVWU, this
article will necessarily touch briefly on the process already
described in a MVWU whilst focusing on the specific elements of a
CVWU.
Directors' responsibilities in view of imminent
insolvency
Prior to delving into the process of a CVWU, it is useful to
remind directors of their fiduciary duties towards the
company's creditors to act within the best interests of such
creditors where the company is experiencing financial difficulties
and approaching insolvency. In a judgment delivered by the First
Hall Civil Court in the names of 'All Invest Company Limited vs
X et1' the
