Companies Act 2014 section 558ZI

Enforcement by creditor of liability: restrictions in that regard unless certain procedure employed to benefit of third person

Section 558ZI restricts a creditor from enforcing a third party's obligation in respect of a company's liability unless the creditor first offers that third party the right to vote on the rescue plan, and sets out the consequences of failing to follow this procedure.

• A creditor wishing to enforce a third party's liability must, within 48 hours of receiving notice of the creditors' and members' meeting, offer in writing to transfer their voting rights on the rescue plan to that third party
• If the third party accepts the offer and notifies the process adviser at the meeting, the voting rights transfer automatically without any formal assignment or additional documentation
• The transfer and any vote cast by the third party do not prejudice the creditor's separate right to object to the rescue plan
• If the creditor fails to make the required offer, they lose the right to enforce the third party's obligation unless no rescue plan takes effect and the creditor obtains court permission