246 SECRETARIAL PRACTICE

Collecting
Debts.

limit to the time during which this may be done, e.g. three
months. In the event of an extension being required, a
further application must be made to the Court.

The right to carry on the business involves the right to do
everything incidental thereto: contracts may be made, the
trade generally may be continued, bills of exchange may be
drawn or accepted, and even, in a proper case, money may
be borrowed for the purposes of the company, upon such
security as the company is able to offer. It is generally
advisable to obtain the sanction of the Court before borrowing
money. It is hardly necessary to point out that any security
given by the liquidator for loans ranks after all existing
securities. The liquidator will, of course, make it clear to all
persons with whom business is done that the company is in
voluntary liquidation.

In carrying on the business, the liquidator must bear in
mind that every invoice, order for goods, or business letter
issued by or on behalf of the company, or of the liquidator
himself, must contain a statement that the company is being
wound up [s. 280].

With reference to debts incurred by the liquidator in the
course of carrying on the business of the company, it must be
clearly borne in mind that these must be paid in priority to
debts and liabilities incurred before the commencement of the
liquidation. They are, in reality, provided they are properly
incurred, part of the costs of the administration of the com-
pany’s affairs, which, as will be seen hereafter, have a priority
over the ordinary liabilities.

In getting in the debts due to the company, the liquidator
will make written demands upon the debtors, and if all
other means fail he will, if he considers it desirable, take
proceedings for recovering debts outstanding. It is neces-
sary, however, to consider carefully whether the proceedings
are likely to be productive of any adequate result. A liquida-
tor would not be justified in suing a debtor when he knew
the debtor could in no circumstances pay. Proceedings
would, in such a case, be merely a waste of the company’s
money. The liquidator has also, as has been stated, power
to compromise with the sanctions indicated on p. 240.

We have seen that a liquidator can sell all or any of the
company’s property, taking care to do so to the best advan-
tage. Thus, he may, if he thinks it advantageous, sell the
book debts instead of realising them himself. It may here
be remarked that, speaking generally, the liquidator may
employ agents to act for him in cases where the skill and