Companies Act 1985

477 Disposal of interest in property

(1) Where the receiver sells or disposes, or is desirous of selling or disposing, of any property or interest in property of the company which is subject to the floating charge by virtue of which the receiver was appointed and which is—

(a) subject to any security or interest of, or burden or encumbrance in favour of, a creditor the ranking of which is prior to, pari passu with, or postponed to the floating charge; or

(b) property or an interest in property affected or attached by effectual diligence executed by any person ;

and the receiver is unable to obtain the consent of such creditor or, as the case may be, such person to such a sale or disposal, the receiver may apply to the court for authority to sell or dispose of the property or interest in property free of such security, interest, burden, encumbrance or diligence.

(2) On such an application, the court may, if it thinks fit, authorise the sale or disposal of the property or interest in question free of such security, interest, burden, encumbrance or diligence, and such authorisation may be on such terms or conditions as the court thinks fit:

But that authorisation shall not be given where a fixed security over the property or interest in question which ranks prior to the floating charge has not been met or provided for in full.

(3) Where any sale or disposal is effected in accordance with the authorisation of the court under subsection (2) of this section, the receiver shall grant to the purchaser or disponee an appropriate document of transfer or conveyance of the property or interest in question, and that document has the effect, or, where recording, intimation or registration of that document is a legal requirement for completion of title to the property or interest, then that recording, intimation or registration, as the case may be, has the effect, of—

(a) disencumbering the property or interest of the security, interest, burden or encumbrance affecting it; and

(b) freeing the property or interest from the diligence executed upon it.

(4) Nothing in this section prejudices the right of any creditor of the company to rank for his debt in the winding up of the company.