Help...Claim form arrived

[shelbs]

Hi everyone,

Newbie needs some advice....PLEASE!

I am a director of a limited company that ceased trading as at 15th November 2010. Early in 2010, i issued an order to a company with an order number for some equipment. Due to cashflow problems, this invoice in the limited company name was n't paid. A few months later, I received another invoice, again in the limited company name, without an order number from this company to my limited company for equipment that wasn't ordered or received. However due to company issues I didn't raise this with them.

On 11th Feb this year, I received a lba from their sols in my company name, for the latter invoice. I contacted them & forwarded them a letter to advise that my company had ceased trading & that also I had never ordered the items & put them to strict proof that the items had been ordered & also delivered & signed for.

The latter invoice was for just over 3k.

The sols advised they would get back to me once they had conferred with their clients.

Today I received a claim brought in my project managers name, not the limited company name to which the invoices had been sent from the company from whom I brought the equipment.

I called the sols who advised they hadn't initiated the claim, that it must have been their clients, which it was.

So...is this not a frivolous claim without legal merit?

No personal guarantees were signed by either myself or my project manager.

The invoices & correspondence were all sent in the limited company name

What do I do?


Any advice gratefully received

 

[obscure]

What do you mean by a claim? Have they sent a new invoice or issued court proceedings?

 

[shelbs]

Hi,

They have issued a claim from Northampton County Court for just under 5k dated 18th February. This is made up of about £1100 for their invoice in April, which we did order, £200 for their second invoice in April, which again we did order & £3000 for an invoice in August which we did not order or receive.

They are also asking for interest from my project manager.

Thanks in advance for your help.

 

[LawontheWeb]

Ordinarily at the first court hearing which would be whats known as the allocation hearing, parties get to make any relvant comments to the court so the judge can give directions to prepare the case for a final hearing.

I would ask the court to strike out the claim on the basis that the claimants has the wrong defendant altogether - i.e no contract at all with the project manager, just with the company. Of course, its for the project manager to raise this asolute defence, not the company, but no doubt you can help.

 

[KernowQueen]

Ordinarily at the first court hearing which would be whats known as the allocation hearing, parties get to make any relvant comments to the court so the judge can give directions to prepare the case for a final hearing.

I would ask the court to strike out the claim on the basis that the claimants has the wrong defendant altogether - i.e no contract at all with the project manager, just with the company. Of course, its for the project manager to raise this asolute defence, not the company, but no doubt you can help.

don't you need to file a defence before you start getting to hearings etc.?

 

[LawontheWeb]

defence after 28 days...but normally in matters of less than £5k (small claim) I would file a defence which is principally - I'm nota defendant!...and then in the covering letter marked as urgent ask the judge to strike out, -the judge will eitehr do so of his own initaive or raise it at the allocation hearing....

 

[jules12345]

Ordinarily at the first court hearing which would be whats known as the allocation hearing, parties get to make any relvant comments to the court so the judge can give directions to prepare the case for a final hearing.

I would ask the court to strike out the claim on the basis that the claimants has the wrong defendant altogether - i.e no contract at all with the project manager, just with the company. Of course, its for the project manager to raise this asolute defence, not the company, but no doubt you can help.

Incorrect

Allocation will be decided by the court upon supplying a defence. If no defence you will enter default judgement or be granted more time to make a defence before allocation athe courts discretion (unlikely I believe unless you apply or agree with the other party).

Jurisdiction of course can be challenged.

Today I received a claim brought in my project managers name, not the limited company name to which the invoices had been sent from the company from whom I brought the equipment.

So you did buy the equipment - I dont understand ...?

 

[jules12345]

May I also highlight to you that in the claim being for nearly £5000 pounds it may be tracked to fast track - which in effect is not the lower courts, IE if you lose the case your opposition will probably have a sol and he or she will be able to claim legal expenses.

This will increase your bill substantially if it isn't tracked to small claims which as the amount is under £5k you may automatically believe it would be. It isn't as simple as that in regards to how the courts track the case and to which level of court.

Hope this helps.

Did the claim include the particulars of claim...?

Regards
Jules

 

[LawontheWeb]

application for a strike out can be made at anytime s the court will make orders of its own initaive to further its own overriding objective.

write to the court asap.

 

[Clarkmans]

Hi

You should file a defence denying that you are personally liable for the debt and stating that the work was done for x ltd.

It is unlikely the court will just strike out the claim on receipt of your defence although you can ask for that in the defence. It is difficult to prove that you have not signed something as the court will not know with certainty that you have not unless the Claimant confirms this. The court will therefore probably allocate this to the small claims track and the matter will be listed for a short hearing.

It is possible to give a personal guarantee by email and so if for example you emailed them saying that you personally agree to pay the sum and typed your name at the bottom then this can be construed as a personal guarantee. If you have not written anything to this effect nor signed any documents or terms with a clause in then it sounds like you have nothing to worry about.

Clare

 

[jules12345]

application for a strike out can be made at anytime s the court will make orders of its own initaive to further its own overriding objective.

write to the court asap.

on what grounds would they strike out before a defence has been submitted ?

 

[shelbs]

Thanks for the many replies.

Sorry for the late response but I have been away for a couple of days

I have just received the allocation questionnaire n149, but I am a bit stuck on section G.
The defence I filed on behalf of my employee was,

1. The claimants have brought this claim against the wrong defendant.
2. The claimants have brought this claim against me personally instead of xxxxx Ltd even though I was just an employee of the company.
3. All three invoices detailed in the claimants Particulars of Claim were addressed & sent to xxxxx Ltd.
4. On the 11th February a letter was received by xxxxx Ltd, addressed to xxxxx Ltd, from the claimant’s solicitors, giving notice of intended legal action. A letter was sent to the claimants solicitors in response, from the director of xxxxx Ltd advising that xxxxx Ltd had ceased trading as at 15th November 2010 & that also that the equipment stated on invoice no 936 had not been ordered by xxxxx Ltd or received By xxxxx Ltd
5. I did not & neither did the director of xxxxx Ltd provide any sort of personal guarantee to the claimants.
6. On 23rd February, I received this claim in my own name not xxxxx Ltd
7. I can provide copies of all the invoices mentioned in the claimants Particulars of Claim, proving that they were issued to xxxxx Ltd & can provide copies of the letters from the claimants solicitors also to xxxxx Ltd
8. I can only believe that the claimant decided to pursue me maliciously, once they found out that xxxxx Ltd had ceased trading.
9. The defendant respectfully asks that the judge strike out this claim as it has no merit, the debt is between ##### ##### & xxxxxx Ltd, not with me.

If anyone could help me fill in section G, it would be most appreciated. It has to be at the court by Friday.

Thanks

 

[shelbs]

Hi everyone,

Due in court next week & have only just received their bundle of documentation today even though the judge gave directions that it should be 14 days before the 19th May. It is postmarked the 12th.

They seem to be relying on the fact that they actually invoiced the company name not the company name ltd & that the first purchase order we sent had the company logo on & didnt say ltd. They say that this proves that my husband was trading as. Is this a valid defence or is it just a ploy, as any company could in theory go after any employee of a ltd company for debt just by omitting the ltd when invoicing.

Hope this makes sense.

All help gratefully received.....I'm really panicking a bit now.

 

[The Resolver]

Whilst they are in breach of the directions ,if you are still in the small claims track then, as procedure is informal, the judge will overlook the delay.

Did any of the documentation/correspondence include the full name with 'ltd'? If not you are in breach of company law by not including the full name. This will not,in any case, help your claim hat they knew they were contacting with a ltdco.

In your original post you told us that the person they were claiming from was your 'project manager'. On the 15th March you referred to him as your 'employee'. Now, two months later, you say he is your husband. Can I congratulate you on your recent wedding and leave it at that.

 

[shelbs]

I wouldn't have thought the fact that I am married to my project manager is pertinent to the issues raised. He is still an employee of the company & is not nor has been a director of my business which was started many years before we married.

My question is... I issued a purchase order with just the company logo on it...which didn't state *****ltd. The equipment ordered was for a job placed on *****ltd. This was the only correspondence with the claimant other than informal emails where the company name ltd wasn't mentioned other than it came from the company email address which also doesn't have ltd in the title.

What I didn't realise was when they invoiced, was that they didn't address the company name ltd, just the company name. However their solicitors did send a letter to the company name ltd, as previously mentioned.

Could this be an problem in court

 

[The Resolver]

The relevance lies in the fact that, with no correspondence from you mentioning that your business is run under a limited company, your suppliers obviously thought they were dealing with a customer without limited liability and, since they have sued your husband, must have assumed, especially as 'project manager' he must have been in some control of the ordering, he was the boss and it was his business or, at best, a husband and wife partnership. How on earth were they to know you were limited if you do not declare it? How on earth were they to know your husband had no ownership of the business.

The factthat the solicitors wrote to the ltdco is of no significanace. they obviously checked the name and finding it ltd, assumed the company was the customer. I presume that in discussing furthetr with their client they must have advised that the contract was with your husband personallly for holding himself out as the customer.

I'm dropping out of this as I am annoyed that you did not declare your relationship when asking for some free advice here. I can put up with the occasional exam question masquerading as a genuine problem but referrng to your husband as just the 'project manager' and expressing shock horror that a poor employee was sued is a bit unfair on the goodwill of Forum members.

 

[shelbs]

I am sorry for appearing to mislead you. However lots of people read this site & I did not want the supplier in question to be sure it was me, hence the vagueness.

I have been in business since 2001 & have come through many rough patches. I have traded my company out of debt when another company went insolvent, owing my business thousands of pounds, so as not to leave suppliers out of pocket. I could quite easily have gone into liquidation at this point but I didn't. Instead I begged, stole & borrowed to keep afloat

I have had many suppliers, none of whom have had issues with purchase orders issued etc.

Indeed my husband & the unofficial director (he is disqualified) of the claimants company have had a previous working relationship many many years ago. He also knows that we are married. The suggestion that they thought they were dealing with a sole trader is ludicrous.

If you think that all I am trying to do is get out of paying debts, then you are mistaken. I ceased trading when an arrangement by the inland revenue was withdrawn for no apparent reason & monies in full were demanded. This was even though I had orders for the next few years. At that time, I could not pay them in full & so as not to trade whilst insolvent, I swiftly ceased trading.

My business traded in a very specialist area of the construction industry. It is a very small community & the claimant is also part of the same industry. I repeat once again they were aware that we were a limited company.

I appreciate that you do not wish to offer help, but I am not being shady or underhand.
I am just concerned & wondered if anyone could help. Thankyou

 

[kulture]

The simple fact is that the claimant is trying to use the fact that your paperwork was poorly done as a way to get money. It is too late now to go back and sort out your headers etc. It would however be better if you can demonstrate that the complainant knew he was dealing with a company. Correspondence, a history of trading, cheques paid by the company for previous supplies etc. would help.

 

[shelbs]

The industry within which I had my business is one where you would always be a limited company.

Firstly, its the construction industry. You are always into suppliers for large amounts of credit as it takes so long to get paid for jobs..90/150 days not unusual, even longer sometimes, occasionally not at all.

Secondly, the risk of going bust is always there as it is an industry where this can & does happen frequently, even with large, seemingly reputable, steady companies.

The claimant has claimed for just under 5K (as before this was disputed anyway by the limited company)....quite a large amount of credit to extend without checking the wherewithal of the recipient, business name, address, ltd or not etc.

Unfortunately we had not traded with this company before. It is an european company with a franchise in England. The parent company who I had emailed on their website for information, got the English company to contact us...so no copy of email.

All I have is the PO which didn't have ltd on it & a few informal emails with my husband & the claimant signing off with their nicknames of years ago. Even the claimants engineers more formal emails to us didn't always end with their company name ltd.

I agree I have been foolish but have never intended to mislead anyone. Out of everyone I have ever dealt with, this is the first time I have ever encountered an issue.

 

[The Resolver]

I repeat once again they were aware that we were a limited company.

But this is the whole point. HOW were they aware. You have not identified any piece of paper that they were given before the contract of supply which informs them you were trading a slimited. You have below said that this was the first time they had traded with you.

All things (such as credit rating) being equal, suppliers give more credit to customers who are unlimited in liability than those whose liability is limited. Imagine you were a supplier and you thought you were dealing with someone who was not limited and who then said "surprise surprise, we are a limited company and have ceased trading and have no money - sorry - must dash of now to sort out the pre-pack liquidation so I can start afresh -after a short break that is in my villa in Spain bought from the past profits of the limited company". This is why its a serious matter to breach the Company disclosure laws.

 

[shelbs]

All I can say is before I did any work for a company, I checked them out to see if they were of a good reputation. Past experience has shown me this.

Also all other suppliers have had me fill in a questionnaire & have checked the business credit rating before extending credit.

You also seem to think that I am trying to pull a fast one here. I am not! I haven't pocketed loads of money from closing the business, when in fact I'm unemployed.

However the whys & wherefores is not what I need to know. I asked for practical advice.

 

[obscure]

Unfortunately what they actually thought and what they will admit to thinking are two different things. They may well have known that you were a Ltd company but are unlikely to admit that if it can be used as the basis of a claim against you. You are legally required to disclose your company's registered name, company number, registered office and place of registration in all company communications - hardcopy and email. (http://www.companieshouse.gov.uk/infoAndGuide/faq/tradingDisclosures.shtml). If you consistently failed to do that it may be hard to prove, or at least show a likelihood, that they knew.

 

[shelbs]

I have written to the court today, to advise the judge that contrary to his/her directions, the claimant didn't send their bundle until the 11th, also that their bundle is not in the prescribed format, just a bundle of random emails between various people & no witness statements.

One of the email actually has them saying that all their invoices & supporting papers are missing from their system, but they will rely on our copies sent to them in time.

Also in relation to invoices 867 & 868 which my company did order, there is many emails between various people in the claimants company about tying these up to a purchase order, however there is nothing about invoice 936 which we dispute.

There is one email that refers to it saying we did order the items.....training & additional costs.

Indeed my husband did undergo some training with this company the previous January (the invoice wasn't issued until August) but this was free of charge as he merely sat in on it. He attended along with a group of South Africans who all signed agreements & were then allowed to take some equipment with them as part of the course. My husband didn't sign any agreement & didn't receive any equipment. He has never even found out if he passed the course.

Oh well, court on Thursday.

 

[shelbs]

Hi everyone,

Here's an update on yesterdays court case. The claimant didn't turn up. My husband went in alone to see the judge, who basically was not best pleased with the claimant. Their bundle didn't comply with his directions, was very late & to top it of was just a huge pile of random emails, no witness statements & they emailed it to the court, so the admin department at the court had to print it all off using their paper...so judge not a happy bunny.

Anyway a bit of a result....the judge struck it out. Still feel a bit cheated not to have had our say... but there you go.

Actually their second invoice was incorrect too as their bundle of random emails showed that we had returned some of the equipment ordered. So out of the 5k they claimed for, the most we would have been liable for is about £900.

But they obviously couldn't prove some of their points & bottled it.

As i said before not a bad result on the whole.

I will keep this thread updated just in case they decide to amend their claim & start the process again.

Thanks for all advice given, it was most appreciated.

 

[kulture]

Thank you for keeping us informed.
It has been a useful exercise for you. Not only in learning what you should have done in the first place regarding showing your full company details, but also in showing that the small claims court is not intimidating. Hopefully you will not need to re-visit.

 

[A City Law Firm LLP]

Make an immediate application to strike out the claim for all the reasons mentioned. Also apply for costs against them if they require a hearing

I would also send them a letter inviting them to withdraw the claim otherwise you will seek to recover all costs against them setting out reasons

Karen

 

[Bill Ryan]

Make an immediate application to strike out the claim for all the reasons mentioned. Also apply for costs against them if they require a hearing

I would also send them a letter inviting them to withdraw the claim otherwise you will seek to recover all costs against them setting out reasons

Karen

Am I missing something? It has been struck out already.

 

[jules12345]

Ordinarily at the first court hearing which would be whats known as the allocation hearing, parties get to make any relvant comments to the court so the judge can give directions to prepare the case for a final hearing.

I would ask the court to strike out the claim on the basis that the claimants has the wrong defendant altogether - i.e no contract at all with the project manager, just with the company. Of course, its for the project manager to raise this asolute defence, not the company, but no doubt you can help.

This would be an application hearing before any allocation hearing, if one were to be ordered by the court, that is.

Regards
Jules