So what are the options available? This depends on the petition and the debt.
The debt should have been paid already
In the unlikely situation that the winding up petition has been received purely due to an oversight on payment then the matter should be simple to settle. By contacting the creditor an agreement can be reached whereby upon payment of the debt, together with any costs, the creditor will seek for the petition to be dismissed. Provided that this is done straight away the petition will not be advertised and therefore it is highly unlikely that the petition will be brought to the attention of other creditors.
Steps then need to be put in place with credit control to ensure that no such error occurs again.
The debt is disputed
If there is a genuine dispute then this needs to be brought to the attention of both the court and the creditor. It is best to open up communication with the creditor if this has not already been done. Explaining why there is a dispute in order to try to reach a resolution. Provided that the matter is being discussed and that the creditor agrees it is likely that the court will adjourn the petition whilst the dispute is resolved.
If the dispute has reached such a level that corresponding is no longer possible, then the matter can be brought to the attention of the court. The dispute can be set out, together with details of how the undisputed element (if any) of the debt will be settled. The court will resolve this and either set the petition aside, or adjourn the hearing whilst the matter is properly dealt with. A winding up order could be made if the dispute is not genuine and no firm proposal for payment has been made.
In this case communication at an early stage with the creditor is key to try to get the matter resolved.
The debt is not disputed but time is needed to pay it
Again communication is important here. Contacting the creditor at an early stage is important before the petition is advertised to try to reach an agreement for the debt to be paid over time. If the creditor is in agreement with this then they can request that the petition be dismissed.
If the creditor is not in agreement with the payment plan and no agreement can be reached then a request will need to be made to the court to adjourn the hearing for the petition whilst the payments are agreed. If it is not possible and no other resolution can be made then the court may issue the winding up order. This is however unlikely if a sensible payment plan is proposed.
The company cannot pay but control over the process is needed
If the petition has been received because the company simply cannot pay the debt and it is insolvent, then it may be that allowing the winding up order to be made is appropriate. In some cases it may be that administration or voluntary liquidation is more appropriate. Steps can be taken to place the company into administration or voluntary liquidation if it is time critical or if there will be a benefit from a voluntary process. More details can be found in other blogs with regard to the key differences. In this case the company can enter into a quicker and potentially more efficient form of insolvency and the petition can be dismissed.
The final option – do nothing
There is always the option to do nothing and simply let the company be wound up, before allowing this to happen it is worthwhile getting advice in case there are other options available which would result in a better outcome for all stakeholders.