Companies Act 2014 section 548

General rule: liability of third person not affected by compromise or scheme of arrangement

Section 548 establishes the general rule that a third party's liability (such as a guarantor's obligation) is not reduced or discharged simply because the underlying debt has been written down under a compromise or scheme of arrangement approved during an examinership.

• A third party guarantor remains fully liable for a debt even if that debt is reduced under an examinership compromise or scheme of arrangement
• Creditors can still pursue guarantors for the full amount of any shortfall caused by a write-down imposed under such a compromise or scheme
• The guarantor and the creditor may agree between themselves that the guarantee will be affected by the compromise or scheme
• The entire rule does not apply where the guarantor is itself a company to which an examiner has been appointed