Limitation in liquidation and balance-sheet acknowledgment: petition date does not stop time, but identifiable debt entries can extend it.

In liquidation claims, limitation runs until the winding up order, not the date of presentation of the petition, because the statutory bar on proceedings operates only from the order and the relation-back fiction has a restricted scope. The decision also treats balance-sheet entries as acknowledgment of liability where they can be linked to identifiable creditors, thereby extending limitation from the date of signing. Claims supported by such acknowledgment were accepted as in time, while any claim already time-barred before the winding up order remained barred.

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Issues: (i) Whether, for determining limitation against claims in liquidation, the material date was the date of presentation of the winding up petition or the date of the winding up order; (ii) Whether entries in the company balance-sheet constituted an acknowledgment of liability sufficient to extend limitation for the claimants.

Issue (i): Whether, for determining limitation against claims in liquidation, the material date was the date of presentation of the winding up petition or the date of the winding up order.

Analysis: The statutory scheme distinguished between the commencement of winding up and the statutory bar on proceedings. The provision deeming winding up to commence on presentation of the petition did not alter the language of the bar against suits and proceedings, which operated only when a winding up order had been made. The doctrine of relation back was held to have a restricted scope and could not be used to suspend or extend limitation. In the absence of an express provision excluding time, limitation continued to run until the winding up order.

Conclusion: The material date for limitation was the date of the winding up order, not the date of the petition; claims already barred by then could not be revived in reliance on the petition date.

Issue (ii): Whether entries in the company balance-sheet constituted an acknowledgment of liability sufficient to extend limitation for the claimants.

Analysis: The balance-sheet entries, including specific references to certain liabilities and unsecured loans, were treated as admissions of existing debts. Where the entries were capable of being linked by evidence to particular creditors, they amounted to acknowledgment within the limitation law and extended the period from the date of signing. On that basis, the claims of the creditors whose debts were so acknowledged were found to be within time and proved to the extent stated.

Conclusion: The balance-sheet constituted a valid acknowledgment for the creditors whose liabilities were identifiable from it, but the claim that had become time-barred by the date of the winding up order remained barred.

Final Conclusion: The objections based on limitation failed in part and succeeded in part. The court accepted the claims supported by acknowledgment in the balance-sheet and rejected the claim that had become barred before the winding up order.

Ratio Decidendi: A legal fiction relating the commencement of winding up back to the petition date does not displace the express statutory point at which the bar on proceedings arises, and limitation continues to run until that bar takes effect unless an express exclusion applies.

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