Preview Questions Liquidation Lawyer | Role Specific Skill

Question 1: When a company enters liquidation, what happens to existing legal actions or pending lawsuits against the company?

Which action should you take?

Choose only one option

The company must settle all lawsuits before moving to liquidation

All legal actions are stayed or suspended automatically under the jurisdiction's insolvency rules

The lawsuits are accelerated to be resolved immediately

Lawsuits are reopened as if the liquidation had never occurred

Question 2: What happens to a company's shareholders during the corporate liquidation process?

Which action should you take?

Choose only one option

Shareholders are given a chance to restructure the company's debt

Shareholders are paid first, before creditors

Shareholders receive any remaining assets after all creditor claims have been satisfied

Shareholders are ignored and receive nothing

Question 3: How are "floating charges" treated under insolvency procedures during liquidation?

Which action should you take?

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Floating charges are disregarded as they are not enforceable in liquidation

Floating charges have priority over secured creditors with fixed charges

Floating charges are subordinated to unsecured creditors in the liquidation process

Floating charges are converted into fixed charges over assets once liquidation is initiated

Question 4: What is the impact of cross-border insolvency laws on the liquidation process?

Which action should you take?

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They limit the assets that can be liquidated across borders

They allow for the recognition and enforcement of foreign liquidation orders in multiple jurisdictions

They prevent international creditors from participating in the liquidation process

They allow foreign companies to automatically participate in the domestic liquidation process

Question 5: How does a Liquidation Lawyer handle the priority of claims during an insolvency procedure?

Which action should you take?

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Prioritize secured creditors, then preferential creditors, and finally unsecured creditors

Focus solely on the largest creditors first

Disregard creditor claims if assets are insufficient

Treat all creditors equally regardless of their status

Question 6: What is the significance of the "stay of proceedings" in a liquidation process?

Which action should you take?

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It stops the liquidation process for a specified period to allow negotiation

It allows the debtor to avoid paying debts until after liquidation

It allows creditors to continue suing the debtor during the liquidation process

It prevents creditors from taking further legal action against the debtor while liquidation is underway