When a company enters liquidation, one of the principles that has to be observed is that creditors of the same class have to be treated the same way. There is, however, an exception to the rule under the Insolvency Rules 2016. If a company in liquidation owes money to a person or organisation and is also owed money by them, then an automatic ‘set-off’ applies and only the net balance is taken into account in the liquidation. This applies by rule of law and cannot be legally overridden.  Continue reading →