New company, Same name

[alexsmith2709]

Hi,
I just wanted to know the legalities of a certain situation. I have a supplier who hasnt answered the last couple emails i sent and didnt answer the phone when i last tried, so i looked on companies house to see if they were still trading and found that since the end of last year i have apparently been trading with a new company with the same name and while the new company is not owned by the same person, it is a member of the family. It appears they changed the name of the original company and then changed the name of the new company to what the original company was called. The original company then went into liquidation early this year. The only communication i had about this was them sending me the new bank details (which i confirmed over the phone at the time). Nowhere did they mentioned about the new company and the liquidation of the old one. Invoices were generated with the new company number, but as they looked exactly the same i didnt notice until i checked.

As i agreed a contract with the previous company, is it right that this can just be taken over by a new company without anyone being informed? Is my contract still valid with this new company? I assume if the company assets were transferred to the new company legally, then all is ok? I have communicated with them a few times over the summer so its not just been a complete stop of communication after the company change, just a recent thing.

 

[ChrisCallaghan]

For help and guidance about the "dos & don'ts" regarding re-use of company name, see the following:

Re-use of company names

www.gov.uk

In short, the restrictions regarding re-use of a company name following a liquidation only apply to the directors of the company that went into a liquidation. If the family member who is the director of the new company was not a director of the company that went into liquidation, then he/she are free to call the company anything they like.

Regarding any contracts that were signed between you and the company in liquidation: in short this will have ended with the company going into liquidation. However it can be possible for these to be transferred to a new company, but usually you would/should have been notified.

 

[alexsmith2709]

Thanks, that makes sense.
It would be nice to know whether the contract was transferred, but not being able to get hold of them makes that difficult

 

[IanSuth]

Thanks, that makes sense.
It would be nice to know whether the contract was transferred, but not being able to get hold of them makes that difficult

As they are a supplier - maybe send their accounts a message saying "Whilst doing some audit work, my accountant has noticed you now have a new Co reg number and has suggested i stop paying any invoices until we can clarify the contractual position, please advise as I value our long relationship"

Bet you they reply faster than a fast thing

 

[Frank the Insurance guy]

1. Previous Company - that contract has ceased as company no longer exists
2. New company - Looks like they have been supplying you, invoicing you and you have been paying them? If so, you have a contractual arrangement with them in respect of those orders/invoices. However the terms may be different to what you had with the previous company.

Is there any importance on retaining the previous contract with the previous company?
If the previous company still has some orders they have not fulfilled for you, then you will just have to let these go and move on (if the company has not yet been dissolved, you can contact them as a creditor).

 

[alexsmith2709]

1. Previous Company - that contract has ceased as company no longer exists
2. New company - Looks like they have been supplying you, invoicing you and you have been paying them? If so, you have a contractual arrangement with them in respect of those orders/invoices. However the terms may be different to what you had with the previous company.

Is there any importance on retaining the previous contract with the previous company?
If the previous company still has some orders they have not fulfilled for you, then you will just have to let these go and move on (if the company has not yet been dissolved, you can contact them as a creditor).

The old company owe me nothing. I have nothing to lose from the old company being liquidated, i was just interested in the legalities of such a thing happening considering a new legal entity taken over but no new contract agreed. If the original contract is now void it could mean either party can pull the plug at any point without notice

 

[Frank the Insurance guy]

If the original contract is now void it could mean either party can pull the plug at any point without notice

Yes, unless the original contract was transfered over to the new company (Think its called "novated") - but I'm sure they would have to legally tell you if that was done! Worth getting some legal advice before you do pull out of the contract (If you have a business insurance policy, many will include free telephone legal advice which will give you the answer).

 

[dylanmarlais]

Yes, unless the original contract was transfered over to the new company (Think its called "novated") - but I'm sure they would have to legally tell you if that was done! Worth getting some legal advice before you do pull out of the contract (If you have a business insurance policy, many will include free telephone legal advice which will give you the answer).

I agree with Frank in that there may be a contract between the new company and you as you are trading with them. You must be doing so on some terms. But we can't be certain of the terms of that contract. It may be the on the same terms as the old contract or it may be on terms implied by law, or a combination of both. Or they may now be sending you Acknowledgements of your Orders with wording such as "subject to our terms and conditions" on the bottom, in which case you may have a contract subject to those terms. Or your Orders may state that the contract is subject to your terms. (You should have standard terms or purchase, and standard terms of sale, and should seek to ensure that these terms apply to your contracts. This is called winning the "battle of the forms". Not the route that gives the greatest certainty.)

To resolve the uncertainty with this particular supplier, it may be an idea to contact them and ask them about the situation and decide on a set of terms that will apply to any further dealings between you and to sign a new written agreement.

(A contact can be novated if the three parties [the old company, the new company, and you] all agree to the novation.)

 

[eteb3]

1. Previous Company - that contract has ceased as company no longer exists
2. New company - Looks like they have been supplying you, invoicing you and you have been paying them? If so, you have a contractual arrangement with them in respect of those orders/invoices. However the terms may be different to what you had with the previous company.

+1 to this, but not to Frank's later post:

IMO this would not be a novation, as that requires the new contract to make reference to the old one - which is explicitly not the case here.

Unless there's some legislation that intervenes because of the slippery name-change, imo you have a contract established by course of conduct with the new company, possibly on your or their standard terms if these are referred to in any of the documents on your side or theirs. If there are standard terms on both sides you are in a "battle of the forms" situation - usually "last to shoot" wins, I think, but it's complicated.

There's a case from 19C of a new owner taking over a pub and not telling the regular drayman, who kept supplying the pub, which kept accepting the beer, and the new publican lost in court when denying liability to the drayman (his rejected case was it was the former owner's contract bc that's who the drayman thought he was dealing with, ergo no contract could form with himself). Strikes me as a v similar situation to the one here.