My company has been dissolved

[Hampstead]

So, owing to the lockdown, my business was unable to continue trading and I have let it be dissolved.

There was a bounce back loan of £10k that simply wasn’t enough for me to get through.

My business account no longer appears in my NatWest app and it transpired there is a mark on my personal account and I cannot use it.

Is this to be expected, or is it protected by the Limited liability?

 

[Mr D]

Perhaps have a word with the bank. Could be an error.
You personally do not owe a penny for business debts unless you signed a personal guarantee.

 

[Chris Parkman]

Have you given the bank a personal guarantee?

 

[WaveJumper]

What did it say in the paper work you signed when you took the 10k

 

[japancool]

Is this to be expected, or is it protected by the Limited liability?

What is protected, your business account or your personal account?

 

[WaveJumper]

What is protected, your business account or your personal account?

Sounds like nothing might be "protected"

 

[japancool]

Sounds like nothing might be "protected"

I don't know what the OP is asking.

 

[MarkOnline]

So, owing to the lockdown, my business was unable to continue trading and I have let it be dissolved.

There was a bounce back loan of £10k that simply wasn’t enough for me to get through.

My business account no longer appears in my NatWest app and it transpired there is a mark on my personal account and I cannot use it.

Is this to be expected, or is it protected by the Limited liability?

How was it dissolved? If you check the terms of your BBL you may find that if you breached the agreement eg it being struck off rather than going through a recognised insolvency process you MAY be personaly liable for the debt. They may argue that your actions (or lack of) were fraudulent.
Welcome to BBL payback time party for the possibly cute operator.(not implying thats you BTW)

That being said, there are accounting professionals who post here who are much better qualified than I to offer an explanation.

 

[Hampstead]

Thank you all for your replies.

I guess my sticking my head in the sand has triggered a clause.

We live and learn. I’ll just have to suck it up.

 

[Chris Parkman]

I don’t think that is the case. Just talk to the bank and when you do ask them whether you have given a personal guarantee

 

[japancool]

Personal guarantees were not allowed for BBLs - although directors could still be held personally liable in the event of wrongful trading or fraud.

 

[Chris Parkman]

While it is true that banks were not allowed to ask for a pg for a bounce back loan, if there was already a pg in place then that pg would cover the bounce back loan because it is a liability to the bank

 

[John Hemming]

I guess my sticking my head in the sand has triggered a clause.

We live and learn. I’ll just have to suck it up.

Very often doing nothing to deal with a problem can be the worst thing to do.* What matters is getting well informed advice as to how to handle the situation. You need to either read and understand the agreements yourself or get someone else to do that. This someone else need not be a paid solicitor, but a solicitor may be best although I accept you don't have a lot of cash.

The precise details of what you agreed to are the issue.

*- there are times when a conscious decision to do nothing works (aka Spongebob), but to be honest personally I don't even like the Spongebob approach even though I know it will work.

 

[ChrisCallaghan]

Hi Hampstead and all, I'm a bit late to this thread!

How was it dissolved? If you check the terms of your BBL you may find that if you breached the agreement eg it being struck off rather than going through a recognised insolvency process you MAY be personaly liable for the debt. They may argue that your actions (or lack of) were fraudulent.

No offence meant to MarkOnline, but this isn't correct. If the BBL was taken out in the name of the limited company, and the company has actually been struck off, then this debt is no longer enforceable. A strike off going through cannot be considered breach of any terms that forces a director to be personally liable, unless there is a personal guarantee agreement.... which there isn't with BBLs.

However Mark may be right in one way, and NatWest may no longer wish to do business with you personally due to what has happened with your company. It is not something I have ever come across but I suppose it is possible. If so, they cannot keep any positive funds held in your personal bank account to offset the BBL. They should offer to send them to another personal account in your name.

Personal guarantees were not allowed for BBLs - although directors could still be held personally liable in the event of wrongful trading or fraud.

Directors can be held personally liable for wrongful trading or fraud, but this will usually come as a result of investigation triggered by a company entering into liquidation. There is no such investigation when a company is dissolved.

In short, if the company is now dissolved the BBLs is no longer enforceable, and has effectively been written off. If NatWest no longer wish to provide you with a personal bank account, they should offer to send any positive funds in your personal account to a different bank account in your name. I suggest you speak with NatWest asap to clarify their position, and come back to this thread once you have an explanation from them.

 

[Mr D]

Hi Hampstead and all, I'm a bit late to this thread!



No offence meant to MarkOnline, but this isn't correct. If the BBL was taken out in the name of the limited company, and the company has actually been struck off, then this debt is no longer enforceable. A strike off going through cannot be considered breach of any terms that forces a director to be personally liable, unless there is a personal guarantee agreement.... which there isn't with BBLs.

However Mark may be right in one way, and NatWest may no longer wish to do business with you personally due to what has happened with your company. It is not something I have ever come across but I suppose it is possible. If so, they cannot keep any positive funds held in your personal bank account to offset the BBL. They should offer to send them to another personal account in your name.



Directors can be held personally liable for wrongful trading or fraud, but this will usually come as a result of investigation triggered by a company entering into liquidation. There is no such investigation when a company is dissolved.

In short, if the company is now dissolved the BBLs is no longer enforceable, and has effectively been written off. If NatWest no longer wish to provide you with a personal bank account, they should offer to send any positive funds in your personal account to a different bank account in your name. I suggest you speak with NatWest asap to clarify their position, and come back to this thread once you have an explanation from them.

Bank short £10k that they may not be able to get paid for....
Understandable they can be annoyed. But enough to cause problems on personal account?

 

[WaveJumper]

Hi Hampstead and all, I'm a bit late to this thread!



No offence meant to MarkOnline, but this isn't correct. If the BBL was taken out in the name of the limited company, and the company has actually been struck off, then this debt is no longer enforceable. A strike off going through cannot be considered breach of any terms that forces a director to be personally liable, unless there is a personal guarantee agreement.... which there isn't with BBLs.

However Mark may be right in one way, and NatWest may no longer wish to do business with you personally due to what has happened with your company. It is not something I have ever come across but I suppose it is possible. If so, they cannot keep any positive funds held in your personal bank account to offset the BBL. They should offer to send them to another personal account in your name.



Directors can be held personally liable for wrongful trading or fraud, but this will usually come as a result of investigation triggered by a company entering into liquidation. There is no such investigation when a company is dissolved.

In short, if the company is now dissolved the BBLs is no longer enforceable, and has effectively been written off. If NatWest no longer wish to provide you with a personal bank account, they should offer to send any positive funds in your personal account to a different bank account in your name. I suggest you speak with NatWest asap to clarify their position, and come back to this thread once you have an explanation from them.

More out of my own interest now and maybe for others in the future who come to the forum:

If a company with a BBL goes into voluntary liquidation in this situation does a licensed insolvency practitioner have to be appointed to sell the business’s assets, repay the creditors in a prescribed order and close the company down etc etc basically is this what the banks are going to expect.

And am I correct in my thinking that if you have used the BBL to pay off other loans which carry a PG thats where your problems may lie in the future

Having read a lot about this over the last few months I came to the conclusion that any company that has taken the BBL needs to be very careful about how they close themselves down and should take professional advice

 

[MarkOnline]

Hi Hampstead and all, I'm a bit late to this thread!



No offence meant to MarkOnline, but this isn't correct. If the BBL was taken out in the name of the limited company, and the company has actually been struck off, then this debt is no longer enforceable. A strike off going through cannot be considered breach of any terms that forces a director to be personally liable, unless there is a personal guarantee agreement.... which there isn't with BBLs.

However Mark may be right in one way, and NatWest may no longer wish to do business with you personally due to what has happened with your company. It is not something I have ever come across but I suppose it is possible. If so, they cannot keep any positive funds held in your personal bank account to offset the BBL. They should offer to send them to another personal account in your name.



Directors can be held personally liable for wrongful trading or fraud, but this will usually come as a result of investigation triggered by a company entering into liquidation. There is no such investigation when a company is dissolved.

In short, if the company is now dissolved the BBLs is no longer enforceable, and has effectively been written off. If NatWest no longer wish to provide you with a personal bank account, they should offer to send any positive funds in your personal account to a different bank account in your name. I suggest you speak with NatWest asap to clarify their position, and come back to this thread once you have an explanation from them.

Thanks for the information.

 

[Red Wood]

While it is true that banks were not allowed to ask for a pg for a bounce back loan, if there was already a pg in place then that pg would cover the bounce back loan because it is a liability to the bank

Nonsense.

There are no blanket PG contractual lock ins that state any possible future debt automatically is assigned under that PG. Specifically to the BBL, no PG was the underpinning of the rescue package.

 

[Mr D]

Nonsense.

There are no blanket PG contractual lock ins that state any possible future debt automatically is assigned under that PG. Specifically to the BBL, no PG was the underpinning of the rescue package.

There has been in the past.

Have come across a couple of times in the past several years. Once from overdraft paid off, not used for a while then new overdraft taken.
Once from a director leaving a company then years later finding themselves liable for all sorts of bank debt that did not exist when they left.

 

[Red Wood]

@Mr D I can see scenario 1 happening, but your second surprises me. I would of thought that could easily be contested though.

 

[Mr D]

@Mr D I can see scenario 1 happening, but your second surprises me. I would of thought that could easily be contested though.

Perhaps it was successfully contested.

Certainly the banks have been known to try getting money out of people even without a pg.
With one... And with no removal by the bank from having a pg....
You and I know it's easy to resign as a director. The other aspects - not everyone appears to make certain they have no liability.
I have heard of banks refusing to remove a pg unless another one is given by someone else.

 

[Red Wood]

I have heard of banks refusing to remove a pg unless another one is given by someone else.

I have no doubt this is the case. I agree with this policy too!

 

[Hampstead]

Well, it turns out that it was just incompetence from the NatWest telephone banking team.

I was trying to pay £16,500 to a car dealership. Although I still couldn’t get any help by telephone (I had travelled 4 hours to collect the car and left my bank card at home), I visited the local branch and was able to withdraw it in cash in 24 hours. One night in a hotel, sorted.