DHN DHN Food Distributors Ltd turned into

DHN Food Distributors Ltd was a wholesale grocery shop as well as a holding company of two subsidiary companies. One of the subsidiary company which was called Bronze owned the lands whereas another subsidiary company which was called DHN Food Transport Ltd owned the vehicles. Two of the subsidiary companies were wholly owned by the parent company. Tower Hamlet issued a compulsory purchase order on this land. DHN Food Distributors Ltd turned into dissolution because there was no available land for the company to continue its business. The defendant had paid compensation for the value of the land to the Bronze and claimed that the plaintiff was not entitled to receive any compensation for the business interruption. The court has lifted the veil of incorporation because the parent company and the subsidiary companies were like a partnership and should be treated as one. Therefore, Tower Hamlet must pay compensation to DHN Food Distributors Ltd as well. Fixed charge is a charge on a specific identifiable property especially on non-current assets. The non-current assets include both tangible and intangible asset such as patent and property, plant and equipment. If there is no assent given by the chargee, the chargor cannot deal with the property such as cannot dispose of a building. This is because the property is temporarily not belonging to the chargor until the loan has been fully paid. Furthermore, fixed charge gives lower risk and higher security for the chargee since the chargor has no right to sell the property. If anything happens, the fixed charge will be paid first over the floating charge. A charge on a class of assets which is usually varying is known as floating charge such as account receivables. On the other hand, the chargor can deal with the asset without the permission of the chargee in the ordinary course of business such as sell the inventories. By selling the assets, the chargor can generate some income to recover the loan.  Floating charge gives higher risk and lower security for the chargee as the chargor reserves the right to dispose of the assets. Floating charge will be paid after the fixed charge and does not link to any specific asset until crystallise it become fixed charge. Crystallisation is a process of conversion which converts a floating charge into a fixed charge.It occurs when the company is going to the process of winding up, the court nominates a receiver, the company terminates its business and the floating charge is automatic crystallisation when an event occurs as stated in the contract.Both fixed and floating charge are necessary to register under Companies Act 2016. Section 352(1) of Companies Act 2016 states that a charge has to be registered within thirty days from the formation of a charge and the prescribed fee is payable for registration. Section 352(8) of Companies Act 2016 enunciates that before the end of the registration period, a person who interested in the charge may lodge with the Registrar. Besides that, Section 361 of Companies Act 2016 states that the time for registration may be extended by the court provided there is a good reason.The consequences of failure to register a charge within the stipulated time are stated in Section 352(2) and Section 352(3). According to Section 352(2) of Companies Act 2016, the charge becomes void against the liquidator and any creditors of the company. For instance, if a fixed charge has not registered yet while the floating charge has been registered, the floating charge will have priority over the fixed charge. Moreover, Section 352(3) of Companies Act 2016 stipulates that the money secured shall immediately become payable when the charge becomes void.