Contributories

This is the term given to members of a company when it goes into liquidation, whether or not they are liable to contribute to a shortfall in the winding up. The CA contains a series of rules as to the liability of contributories, the most important being that the holders of fully paid shares are not liable to contribute. If it is necessary, and possible, to enforce a contribution from contributories, this is done by way of a call by the liquidator following the preparation and settlement of a list of contributories.

Conversely, it may be possible for the liquidator to have a surplus for distribution to contributories and this will often be the case in a members’ voluntary. In a court winding up, a surplus can only be distributed with the special leave of the court.

See Contributories.