how liquidators are paid
liquidators charge fees for their services this cost varies depending on the size of the business the complexity of the case and the time needed to complete the job the insolvency act 1986 specifies the absolute priority also known as the liquidation preference with which stakeholders are repaid in the event of a bankruptcy or liquidation according to the law liquidators are always paid first payments are then made to senior secured creditors unsecured and subordinated creditors and preferred shareholders common shareholders are generally the last creditors who are paid during the liquidation process in some jurisdictions a liquidator may also be named as a trustee as in a bankruptcy trustee real world example of liquidatorsthere are many examples of liquidators taking charge of company affairs this occurred with shoe retailer payless saddled with debt the company filed for chapter 11 in 2017 with plans to liquidate almost every store it owned in the united states and canada 1although payless managed to restructure and survive that period it wasn t fully out of the lurch it filed for bankruptcy again in february 2019 saying it would close all of its retail locations across north america which amounted to about 2 100 stores the company ended up selling its merchandise at a discount to consumers 2