Difference between a bankruptcy trustee and an administrator
A company in serious financial difficulty can ask the court to disclose which lawyer will be appointed as the bankruptcy trustee in a possible bankruptcy. In the role of an ‘undisclosed’ administrator, the intended bankruptcy trustee can start an inventory of the struggling organization in anticipation of bankruptcy. The difference between a bankruptcy trustee and the undisclosed administrator is that a bankruptcy trustee is only appointed by the court when the bankruptcy is actually declared.
The duties of an undisclosed administrator
The main duty of an undisclosed administrator is to limit the damage suffered by customers, employees and creditors, as well as the company itself, due to the impending bankruptcy of the company. Together with the entrepreneur, the options for making a restart are discussed, among other things, for example, by preparing a pre-pack. The difference between a bankruptcy trustee and an undisclosed administrator is that an undisclosed administrator has no formal duties or powers. The appointment of the undisclosed administrator is primarily intended to complete the initial phase of the bankruptcy proceedings as quickly as possible from the moment the administrator has been officially appointed by the court as the bankruptcy trustee.
‘Undisclosed or intended’ examining magistrate
Another difference between a bankruptcy trustee and undisclosed administrator is the fact that the latter, not being the administrator of a company, can at an early stage advise the examining magistrate about, for example, the options for restarting the bankrupt company. Just like the undisclosed administrator, the intended examining magistrate too is appointed by the court in the run-up to a possible bankruptcy. After the bankruptcy has been declared, this ‘undisclosed or intended’ examining magistrate acts as a supervisor of the bankruptcy trustee.
Difference between a bankruptcy trustee and an administrator in bankruptcy
The main difference between a bankruptcy trustee and an undisclosed administrator in bankruptcy is the addition of ‘undisclosed’. The designation of an undisclosed administrator is not public. This gives the company in financial difficulty and the undisclosed administrator the space to take stock of the situation in peace, without creditors being aware of it. To be clear: the appointment of an administrator after applying for a suspension of payment or the appointment of a bankruptcy trustee after a company or organization has been declared bankrupt by the court is, on the other hand, public.
Bankruptcy trustee or administrator?
Is your company struggling with rising debts or payment problems and do you want to prevent bankruptcy or prepare for it? Or would you like to receive more information about filing a petition for bankruptcy and the difference between a bankruptcy trustee and an administrator and what they can do in your situation? The bankruptcy law specialists at Fruytier Lawyers in Business regularly manage bankruptcies as trustees and will be happy to give you specific and personal advice. Feel free to contact us for more information about what our lawyers can do for you. You are not committed to anything.