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In finance, liquidation is also sometimes used as convenient shorthand for converting an asset to cash.
The parties who are entitled by law to petition for the compulsory liquidation of a company vary from jurisdiction to jurisdiction, but generally, a petition may be lodged with the court for the compulsory liquidation of a company by: The grounds upon which one can apply for a compulsory liquidation also vary between jurisdictions, but the normal grounds to enable an application to the court for an order compulsorily wind-up the company are: A "just and equitable" winding-up enable the ground to subject the strict legal rights of the shareholders to equitable considerations.
It can take account of personal relationships of mutual trust and confidence in small parties, particularly, for example, where there is a breach of an understanding that all of the members may participate in the business, A lawsuit is a civil action brought before a court in order to recover a right, obtain damages for an injury, obtain an injunction to prevent an injury, or obtain a declaratory judgment to prevent future legal disputes. Upon hearing the application, the court may either dismiss the petition, or make the order for winding-up.
The court may dismiss the application if the petitioner unreasonably refrains from an alternative course of action.