Abstract:
When a company becomes subject to winding-up proceedings, it is widely thought to lose beneficial ownership of its property. The property is held, instead, on a “statutory trust” to discharge the company’s liabilities. The attribution of this “proprietary” effect to the commencement of winding up has, however, created significant confusion. Faring particularly poorly is our understanding of the status of those of the company’s assets in which others held proprietary rights prior to this point, notably, assets the company’s title to which is encumbered by security interests. The confusion takes many forms and infects several areas of analysis. This article undertakes a fresh analysis of these complicated issues at the intersection of the laws governing property and insolvency.