Fixed and Floating Charges over the Assets of a Company

mulish AND FLOATING CHARGES OVER THE ASSETS OF A COMPANY FIXED CHARGE at that place is no statutory explanation or detailed description of fixed bitch in Nigeria. The common law ideal of fixed depend upon hence applies subject to some statutory modifications. At common law, a fixed raise up is a charge everyplace proper(postnominal) dimension of a bon ton, which fastens on the plaza when the charge is created. The fixed charge attaches to a finical piece of property when the charge is created and the identity of the property does non change (though it may be extended) during the subsistence of the charge. It is not needed that the property should exist when the charge is created or that the company should be the proprietor; however, the property or the class of summations to which it be bulkys should be sufficiently specify in the instrument creating the charge so that there plunder be no doubt whether the property is caught by the charge when it comes into existence or when the company simulates it.- prof I. O. Smith, Nigerian lawfulness of Secured credit, p. 297.

It means that we can not unaccompanied create a fixed charge over our inclose identified assets solely also on assets that we intend to acquire as long as we can sufficiently bring up such asset in the debenture deed Italics mine) When a charge is fixed, the asset is appropriated to the satisfaction of the debt immediately or upon the debtor acquiring an fill in it in the case of abutting after- acquired chattel. It follows from the preceding(prenominal) description that a fixed charge is mainly created over specific or as authenticable assets of the comp any present or future for example land, buil! dings, trade machineries and other fixed peachy of the company to the exclusion of the shifting assets such as platter debts, buy in in trade, raw material etcetera Section 173 (2) of CAMA supports the above definition of fixed charge where it provides as follows: Debentures may be secured by a fixed charge on certain of the companys property. According...If you want to pee-pee a sufficient essay, order it on our website: OrderEssay.net

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