Can a CVA provide protection from executions or distraint action?
Yes for companies with no more than 50 employees and with turnover under £2.8M per annum. It is now possible to seek protection from creditors using the new CVA procedure that includes a moratorium. Under the new procedure a 28 day moratorium automatically commences on the filing at Court of certain documents. There is no requirement for a court order. The 28 day period can be extended up to two months but the existence of the moratorium does have to be advertised. The moratorium prevents action by a landlord or secured creditors against the company’s property and assets and prevents any other legal process including another insolvency procedure from commencing or continuing.
