Secured creditor interest survives winding-up where the creditor stays outside insolvency and relies on security until full payment.

A secured creditor who does not realise, relinquish, or value his security remains outside insolvency for the secured debt, so the creditor's contractual rights are not displaced by the winding-up order. The rules limiting post-adjudication interest on provable unsecured debts apply only to creditors competing in insolvency, not to the secured portion of the claim. The official liquidator takes only the equity of redemption, and only any unsecured balance, if proved, is governed by insolvency rules on dividend and interest. The secured debt therefore carries contractual interest until payment in full.

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Issues: Whether a secured creditor who has not brought himself within the insolvency provisions by realising, relinquishing, or valuing his security is entitled to interest at the contractual rate beyond the date of the winding-up order, and whether the rules applicable to provable unsecured debts limit such interest.

Analysis: The legal scheme of the Companies Act and the Provincial Insolvency Act was examined on the footing that a secured creditor stands outside insolvency so long as he relies on his security and does not adopt one of the statutory courses that make his debt provable under the insolvency provisions. In that situation, the creditor's contractual rights remain unaffected by adjudication, and the official liquidator acquires only the equity of redemption. The rules limiting post-adjudication interest on provable debts apply to creditors competing in insolvency, not to a secured creditor who has not entered that field. Only the unsecured portion of the claim, if any, is governed by the insolvency rules on dividend and interest.

Conclusion: The secured creditor was held entitled to contractual interest on the secured debt until payment in full, and the winding-up date did not cut off that entitlement; the post-adjudication limitation on interest applied only to any unsecured balance proved in insolvency.

Ratio Decidendi: A secured creditor who does not realise, relinquish, or value his security and does not prove within the statutory insolvency options remains outside insolvency for the secured debt, so his contractual right to interest continues until satisfaction from the security.

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