Law of Property Act receivership
What is it?
It is used where a lender appoints a Law of Property Act Receiver ('LPA Receiver') over a specific property asset. He is either an insolvency practitioner or chartered surveyor. His general powers are set out in the Law of Property Act 1925, however he may be granted additional specific powers in the security documentation itself.
Who is it for?
It is used in situations where the lender's primary, if not only,
asset is a property asset.
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The Process
The LPA Receiver will seek to sell the property to repay the lender. If an ongoing business is intrinsic to maximising the realisations from this property asset he will seek to maintain this business as a going concern during the sales process.
Advantages
- Costs are minimised as the appointee's responsibility is solely to deal with the property asset rather than all facets of the business
Disadvantages
- The security document may not give the LPA Receiver the power to trade any intrinsic business and as this power is not contained in the Act it may not be possible to maintain any ongoing business to maximise the value of the property
Other Options available
Administration , Company Voluntary Arrangement (CVA) , Equity Investment, Informal Creditor Agreement , Sale
of business, Administrative Receivership
Call us on 0800 195 4585 if you require any help or assistance regarding 'Law of Property Act receivership'.
