Building on the understanding gained by the discussion in Chapter 6 of the socially harmful features of administrative receivership, this chapter discusses the administration procedure introduced by the Enterprise Act 2002. It explains how this procedure retains the only defensible feature of receivership, in that a selected creditor continues to be entrusted with the right unilaterally to displace the underperforming management of a distressed company. The chapter analyses the statutory hierarchy of objectives made available to the administrator and explains the standard to which he is expected to be held in choosing between them. Light is also thrown on the sort of factors that might justifiably be taken into account in making this choice. The relationship between the administrator's duties and the voting rights of creditors is examined. The chapter concludes with a discussion of the sort of factors that might precipitate challenges by aggrieved creditors and members to the administrator's decisions and actions.
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