Research On Protection Of Creditors In Corporate Liquidation

Liquidation,one of the most important components of the corporate legal system,is to rule exits of corporations,ensure corporations to terminate legal relationship in legal procedure,and finally be canceled in law.The most important relationship is between corporations and creditors.Protection of creditors is the core of research on liquidation.The value orientation of improvement of liquidation should be protection of creditors.The characters of creditors in liquidation are discussed in the first part.There are commonness and individuality between creditors in liquidation and general creditors of corporation.The individuality of creditors in liquidation is that creditors should report claims in the legal period and should achieve realization by legal procedure.Under analysis of maintenance of social order,balance of interests and social justice,research on value orientation of liquidation points out that interests of creditors should be protected in liquidation legal system.One of the characters of liquidation legal system is procedural.Procedural justice ensures the achievement of substantive justice.Therefore,to improve liquidation procedure is the guarantee of protection of creditors in liquidation.To find out the better way of protection of creditors in liquidation,the starting,progresses and ending of procedure of liquidation are discussed in the second part.The right to know is the basic right of creditors.The right to know of creditors is restrict while corporations running its business normally,in accordance with independent right of corporations and the principle of efficiency.However,creditors are severely at legal risk as the result of liquidation.The right to know of creditors should be expanded and protected by law to ensure creditors can make the best choice to safeguard their own interests immediately.In the third part,the author points out that registration of corporate liquidation should be established to protect the right to know of creditors.The interests of creditors are property right of creditors virtually.Restriction ofpayment of debts made by the corporations to individual creditors,ranking of payment of debts and restriction of distribution of corporate property are effective measures to protect property right of creditors.Any right without remedy is not a right.It would be fail to protect interests of creditors without remedy mechanism in liquidation.The basic theory of protection of creditors,including piercing the corporate veil and the third person infracting rights of creditors,are discussed in the fifth part.As the result of the theories,shareholders,directors and liquidators should take on legal obligation in specific circumstances.In conclusion,the best remedy for creditors should be to confer the litigation right of creditors.