How To Make A Claim Against A Company In Voluntary Administration In NZ

Nothing throws a small business off track like finding out a customer can’t pay because they’ve put the company into voluntary administration.

If you’re a supplier, contractor, landlord, or service provider, the immediate questions are usually practical (and urgent): Will we get paid? What do we do next? Do we stop supply? How do we actually make a claim?

This guide walks you through what it means when a customer is in voluntary administration, what your rights and risks usually look like in New Zealand, and the steps you can take to lodge your claim and protect your position.

Because every administration has its own quirks, think of this as a practical roadmap rather than personalised legal advice. If you’re dealing with a high-value debt, ongoing supply, personal guarantees, or security interests, it’s worth getting tailored advice early so you don’t accidentally lose leverage.

What Does “Company In Voluntary Administration” Mean For You As A Creditor?

In plain English, voluntary administration is an insolvency process where an independent administrator is appointed to take control of the company and assess whether the business can be saved or whether it should be wound up.

For you as a creditor or supplier, the biggest immediate impacts are:

• You’re no longer dealing with the directors in the usual way - the administrator effectively steps into the driver’s seat.
• Payments often stop (at least temporarily) while the administrator works out what money is available and who is owed what.
• There are usually restrictions on enforcement action (for example, starting or continuing court proceedings) because the Companies Act 1993 gives the company a statutory “breathing space” during administration, subject to some important exceptions.
• Your chances of recovery depend on your “type” of claim (secured, unsecured, employee, etc.) and the outcome of the administration.

This is where many small businesses lose time and bargaining power: they keep supplying or negotiating informally, but don’t formally lodge a claim early or clarify the legal basis of what they’re owed.

If your customer is in voluntary administration, your best starting point is to get very clear on two things:

• What you’re owed (amount, due dates, invoices, interest, costs, etc.)
• Why you’re owed it (the contract terms, purchase order, credit terms, retention of title clause, security interest, guarantee)

Step-By-Step: How To Lodge Your Claim With The Administrator

Administrations can move quickly, and administrators typically work through a standard process for identifying creditors, valuing claims, and proposing an outcome (like a deed of company arrangement).

While the exact forms and timelines can vary, here’s a practical step-by-step approach that works well for most creditors and suppliers in NZ.

1) Confirm The Administration Details Immediately

As soon as you hear the company is in voluntary administration, confirm:

• The administrator’s name and contact details
• The appointment date (this matters for timing and what debts are “pre” vs “post” appointment)
• The company name and NZBN (be careful with similarly named entities)

If you’re unsure whether you’re contracting with the right entity (for example, the trading name is different), it’s worth checking your contract documents, invoices, and customer application forms.

2) Gather And Organise Your Supporting Documents

Administrators will usually ask for evidence. The more organised you are, the easier it is to get your claim accepted (and less likely you’ll spend weeks in back-and-forth emails).

Common documents include:

• Signed contract, accepted quote, or terms of trade
• Purchase orders and order confirmations
• Invoices and statements
• Delivery dockets / proof of supply / completion records
• Emails confirming scope, pricing, variations, acceptance, and delivery
• Any credit application, guarantee, or security documentation

If your trading relationship was mostly “handshake + invoice”, you can still be a creditor - but it’s more important to show a paper trail that there was agreement on price and supply. If you need stronger contracting going forward, tightening up your Terms of Trade can make a huge difference to recoverability and leverage when customers hit trouble.

3) Work Out Your Claim Amount (And Be Specific)

Your claim is usually more than “all outstanding invoices”. Take the time to calculate it properly, including:

• Principal debt: unpaid invoices
• Disputed items: flag anything you expect they may challenge (e.g. variations, extras)
• Interest: if your contract allows it
• Collection / enforcement costs: only if clearly allowed under your terms

Be careful not to inflate the claim with amounts you can’t justify contractually. Overstated claims often get queried, which can slow everything down.

4) Lodge A Formal Proof Of Debt (And Keep Records)

Administrators typically use a “proof of debt” style process to assess claims (including for voting at creditor meetings and, if a DOCA proceeds, for calculating entitlements under the DOCA). The exact form and instructions usually come from the administrator.

Practical tips:

• Submit the claim in writing (email is usually fine) and ask for confirmation of receipt.
• Use clear file names (e.g. “Proof of Debt - ABC Ltd - $12,450 - Jan 2026”).
• Keep a single PDF bundle of key evidence so it’s easy to forward or re-send.

Even if you’re not sure about the final amount (for example, there’s a credit note pending), lodge an initial claim and then update it. Waiting for “perfect” information can mean missing practical deadlines (including deadlines tied to creditor meetings).

5) Attend (Or At Least Engage With) Creditor Communications

Administrators will usually send notices about creditor meetings, reports, and proposals. These aren’t just “FYI” emails - they’re often where the key decisions are made.

If the debt is meaningful to your cashflow, it’s worth:

• Reading every report carefully
• Asking questions early (in writing)
• Voting where you’re entitled to vote

In NZ, the Companies Act sets specific meeting milestones (including an early meeting soon after appointment and a later “watershed” decision meeting, unless timeframes are extended). If you miss these, you may lose a chance to influence the outcome.

What Type Of Creditor Are You (And Why It Changes Everything)?

Not all creditors are treated the same. Your likely outcome depends heavily on the legal “bucket” your claim sits in.

Unsecured Suppliers (Most Trade Creditors)

If you supplied goods or services on ordinary invoice terms and you don’t hold security, you’re likely an unsecured creditor.

Unsecured creditors often recover only a portion of what they’re owed (and sometimes nothing), depending on:

• how much cash and assets the company has
• whether there are secured creditors ahead of you
• the costs of the administration
• whether the business is sold or restructured

This is why prevention matters: strong contracting and credit processes can help you avoid being stuck at the back of the queue.

Secured Creditors (Security Interests, Charges, PPSR)

If you have a valid security interest over the company’s assets (for example, registered on the PPSR where required), you may be a secured creditor.

In that situation, your rights can be very different. For example, under NZ’s voluntary administration regime, a secured creditor with security over the whole (or substantially the whole) of the company’s property may be able to enforce during a short “decision period” early in the administration, or later with consent/court leave. The timing and type of security matters.

If you’re not sure whether you’re properly secured (or you have a retention of title clause but didn’t register it), get advice quickly - security is a technical area, and mistakes can be expensive.

Retention Of Title (ROT) Suppliers

If you sell goods on credit, you might have a retention of title clause in your contract stating you keep ownership until paid.

In an insolvency scenario, a properly drafted clause (and proper operational steps like tracing stock) can sometimes allow you to:

• recover goods that haven’t been paid for (in certain circumstances), or
• assert rights over proceeds of sale (depending on the clause and facts)

ROT clauses are one of those “you only appreciate them when things go bad” protections - but they need to be drafted and used correctly (and may interact with PPSA registration requirements).

Landlords And Service Providers With Ongoing Contracts

If you’re dealing with a lease, equipment hire, or ongoing service contract, you may have a mix of:

• arrears (pre-administration debt), and
• new obligations arising if the administrator continues to use the premises/services

This is where you need to be careful about continuing supply “as normal”. If you keep delivering after the appointment date, clarify in writing whether those post-appointment supplies will be paid as they fall due, and on what terms.

If a premises arrangement is involved, the contract position can get complex quickly. It may be helpful to have your Commercial Lease reviewed so you understand default rights, termination triggers, and how to approach the administrator without accidentally waiving rights.

Can You Still Get Paid? Understanding DOCA, Liquidation, And The Practical Reality

Once you’ve lodged your claim, the next question is usually: how does this end? In many administrations, there are a few common pathways.

A Deed Of Company Arrangement (DOCA)

A DOCA is essentially a compromise or restructure deal between the company and its creditors. It might involve:

• creditors receiving a cents-in-the-dollar payment
• payment by instalments over time
• the business being sold and proceeds distributed
• creditors agreeing to accept less to keep the business alive

For suppliers, a DOCA can be a “something is better than nothing” outcome - but don’t assume it’s automatically good. You’ll want to understand:

• how much you’ll receive and when
• what happens if payments are missed
• whether directors or related parties are contributing funds
• whether claims are being treated fairly across creditor groups

Liquidation

If the company can’t be saved, it may go into liquidation. In liquidation, assets are realised and distributed in an order set by law.

For many small trade creditors, liquidation can mean a low return. But it can also open up other avenues, such as investigating voidable transactions or director conduct (depending on the facts). Those are not quick wins, but they can matter where there’s been serious misconduct.

Business Sale (Sometimes With A “Phoenix” Risk)

Sometimes the underlying business is sold (for example, to a third party, or to a related party). If you’re a supplier, you may feel pressure to keep supplying because the “new” business wants to keep trading.

This is where you should slow down and treat it as a fresh credit decision. Before you agree to new supply, make sure you have:

• clear written terms
• up-to-date credit checks
• security/guarantees where appropriate

It’s also a good time to check whether you’re contracting with a different legal entity than before. If the contracting entity changes, you may need a new agreement (and you don’t want to accidentally release the old debtor).

Practical Ways To Protect Your Business While The Administration Is Ongoing

When one customer goes into administration, it’s not just a “debt” problem - it’s a cashflow and risk management problem. The goal is to minimise further exposure and put yourself in the best position to recover what you can.

Stop Or Restructure Further Supply (Without Burning Your Rights)

If you’re still supplying, ask yourself:

• Are we legally obliged to keep supplying under an existing contract?
• Are we supplying on credit (riskier) or cash-on-delivery / upfront payment (safer)?
• Do we have any termination rights triggered by insolvency events?

Be careful about making threats you can’t legally carry out (for example, refusing to perform a contract when you have no right to suspend). A quick contract review can prevent a bad situation becoming a dispute.

Check For A Personal Guarantee Or Director Liability Pathways

Many small businesses extend credit on the basis of a signed personal guarantee (often in a credit application). If you have one, your recovery options may be much stronger than relying on the insolvent company alone.

Guarantees and enforcement need to be handled carefully (especially around notice requirements and proof), so this is a classic “get advice early” moment.

Review Your Standard Terms For Future Customers

If you’re reading this because you’ve just been burned, you’re not alone - but it’s also a chance to tighten your legal foundations so you’re better protected from day one.

Common upgrades that help suppliers include:

• clear payment terms, interest, and recovery costs clauses
• stronger retention of title wording (where relevant)
• credit limits and a right to suspend supply for non-payment
• clear dispute and variation processes so invoices aren’t easily challenged later

If you don’t already have tailored documentation, it may be time to put proper Service Agreement terms in place (or updated supply terms) so you’re not relying on informal arrangements.

Keep Your Own House In Order (Cashflow And Paperwork)

When a customer doesn’t pay, it can cascade into your own obligations (wages, tax, rent, supplier bills). If you’re negotiating new arrangements with other counterparties, get key variations in writing, and keep your debtor records (contracts, delivery evidence, statements) neat and ready to re-send if the administrator requests more detail.

Key Takeaways

• If your customer is in voluntary administration, act early: confirm the administrator details, gather evidence, and lodge your claim through the administrator’s proof of debt/creditor claim process.
• Your recovery prospects depend heavily on your creditor type (unsecured, secured, retention of title supplier, landlord, etc.), so it’s worth working out where you sit before making big decisions.
• Be cautious about continuing supply during administration; clarify post-appointment trading terms in writing so you don’t increase your exposure unnecessarily.
• Check whether you have extra leverage such as retention of title rights, a security interest, or a personal guarantee - these can change the outcome significantly.
• Use this as a trigger to strengthen your legal foundations for future customers, including properly drafted Terms of Trade and tailored contracts.
• Where the debt is significant or the facts are messy (disputes, guarantees, leases, security, or changing entities), getting tailored legal advice early can save you time and protect your position.

If you’d like help responding to a customer in voluntary administration, reviewing your contracts, or strengthening your credit and supply terms, you can reach us at 0800 002 184 or team@sprintlaw.co.nz for a free, no-obligations chat.