Shutting down company to avoid paying a judgement

[Harcourt]

Hi,

We issued a claim against a company in county court, won and obtained a judgement.

We've noticed today that the company in question is showing as "proposal to strike off" on companies house.

When we looked into it further it seems that prior to this company the same directors had another company at the same address which they voluntarily liquidated. It was effectively the same business i.e. same line of work, same directors, same premises and the only difference is the new company name has UK in brackets after it.

Is there anything we can do to block the strikeout while we attempt to enforce our judgement?

If they are allowed to just close down and start again can we take any action against the directors regarding thier conduct in shutting down companies one after each other with outstanding liabilities?

Thanks

 

[Interested Berkshire]

Write to Companies House stating you are a creditor or this company, and that you are formally opposing its being 'struck off'.
This will buy you time to go after the Co. Directors, probably the quickest route to getting paid.
If they want to dispose of the company correctly then it will have to go through some formal insolvency procedure, which i doubt they will want to go through again as the damage this can do could be lasting, especially if the last company they liquidated was quite recent. If they have continued to trade whilst insolvent, you can go after the Directors personally - (if they didn't pay your bill as and when it fell due, then this could be an admission of insolvency). If you explain to the Directors the position they have put you in, that by making you pursue them personally, it would then be quite simple for all the other creditors of the company to do the same... They might see the light.....
Remember to smile when delivery the good news.

 

[Spongebob]

It looks like the directors are trying to slip through a strike-off as an easy alternative to liquidation without any creditors noticing. Well done for rumbling them!

As suggested above, write formally to Companies House stating your objection to the strike-off as a creditor of the company. Then, speak personally to the MD offering to lift your objection if you get paid immediately.

His alternatives are to appoint an insolvency practitioner to liquidate the company at a cost of around £5,000, or to wait until a creditor winds the company up at which point the Official Receiver will step in and act as liquidator. This could not only take a year or so, but could prove a difficult excercise given his previous history of insolvency.

I suspect that on reflection he will prefer to pay you!

What he possibly doesn't realise is that if one of the company's creditors is HMRC then they will routinely object to the strike off anyway. HMRC are always a creditor!

So don't waste any time.

Good luck.

Bob

 

[baxterboy]

The exact same thing happened to me. The company in question has a duty to inform ALL creditors of the application to strike off. You can apply to Companies House to monitor the company, this way you will know exactly what they are up to. Your objection to the strike off will last for three months, after which time you can re-apply to continue your objection. Companies House will ask you to send proof that you are a creditor. It is best to send any documents by registered post/recorded delivery. Also, it is an offence for the company to have traded 3 months prior to applying to stike off. Good luck to you, there are so many similar posts to yours. It really is time the powers that be should address this ever growing problem, after all, this is rightfully YOUR MONEY!!

 

[elaine@cheapaccounting]

This is the info from Co House web site:

11. How and why can they object?
Objections or complaints must be in writing and sent to the registrar with any supporting evidence, such as copies of invoices that may prove the company is trading. Reasons could include:

• if the company has broken any of the conditions of its application for example, it has traded, changed its name or become subject to insolvency proceedings during the three-month period before the application, or afterwards;
• if the directors have not informed interested parties;
• if any of the declarations on the form are false;
• if some form of action is being taken, or is pending, to recover any money owed (such as a winding-up petition or action in a small claims court);
• if other legal action is being taken against the company;
• if the directors have wrongfully traded or committed a tax fraud or some other offence.

A full list of conditions can be found in sections 1004 and 1005 of the Companies Act 2006.


You can find it here:


http://www.companieshouse.gov.uk/about/gbhtml/gp4.shtml

 

[baxterboy]

Yes elainec100, I am very aware of all the points you raise. This same senario happened to me. I am at present awaiting answers from CH. I too had a ccj in my favour, which has gone unpaid, and have evidence that the company has carried on trading after applying to dissolve.
So many companies think the easy way out is to dissolve without paying monies awarded by the tribunal. I intend to persue my claim to the bitter end. The information you have provided could help so many others in the same position, as this seems to be a regular occurance.

 

[Mpg]

I phoned them as a final gazette???? had been issued they asked that i emailed in and they suspended it for 6 months saying i would have to provide proof if i wanted it to extend any further.

Hello,

I have been asked to Email by one of your operators.

My company is currently suing ******** Ltd and we are in court for a small hearing tomorrow 19/08/09 as he is trying to have a judgment overturned.

I would therefore if possible request that you do not dissolve the company just yet


If you require any information please don't hesitate to contact me on

I had a response within 3 days

Oh and I won in the end


oops Email address is
[email protected]

 

[elaine@cheapaccounting]

Yes elainec100, I am very aware of all the points you raise. .

Great - I was posting for the OP though

 

[Harcourt]

Thanks for all the advice so far, it really is appreciated

Companies House replied to my email today and asked me to send documentary evidence (e.g. the judgement)

They will then consider if my objection stands or if the dissolution will continue.

I've phoned the company in question this morning to hear "good morning this is company name, how can I help" - makes me so mad. They're just completely playing the system.

 

[ewcollections]

We deal with international claims. The very frustrating for our clients / creditors, especially from countries like Poland, Lithuania, Slovakia or Germany is, that normally the limited company just finishes its business activity in UK with enormous debt and without any consequence to the directors / owners and there is nothing the creditor may do against it.
So far we have seen many clients who came along with their claims too late against the UK debtors, when already there was nothing after such ltd.company.
But obviously another problem is to convince the directors of still existing ltd. to pay off when the company is planned to be dissolved.
In other systems (e.g. Poland) you cannot just walk away with a debt even if you have ltd. dissolved, unless you declared insolvency. There is always a possibility to chase directors / board members if you prove that insolvent company has no assets to settle the claim and the enforcement of judgement by bailiff is without success.

 

[Harcourt]

Write to Companies House stating you are a creditor or this company, and that you are formally opposing its being 'struck off'.
This will buy you time to go after the Co. Directors, probably the quickest route to getting paid.
If they want to dispose of the company correctly then it will have to go through some formal insolvency procedure, which i doubt they will want to go through again as the damage this can do could be lasting, especially if the last company they liquidated was quite recent. If they have continued to trade whilst insolvent, you can go after the Directors personally - (if they didn't pay your bill as and when it fell due, then this could be an admission of insolvency). If you explain to the Directors the position they have put you in, that by making you pursue them personally, it would then be quite simple for all the other creditors of the company to do the same... They might see the light.....
Remember to smile when delivery the good news.

How would we go about going after the directors personally?

Thanks

 

[Dusty]

Hi Harcourt. My story exactly (even down to the appended UK) I'm guessing that in your situation it was not the company but HMRC who applied for the strike off. My experience is that HMRC is totally disinterested in the fact that they owe them £1500 in late penalties and will still move to strike off so, I'm wondering where Spongebob got his info from.
To be honest I never thought I'd be advising anyone on this but I've done a lot of research so this may help.
Firstly under s216 and s217 of the insolvency act, it is illegal for a director of a company in liquidation to form a similarly named company so the correct way would be to petition for the company to be wound up. But..this is expensive and while the liquidators would undoubtedly uncover wrongdoings as your directors have breached all sorts of statutory laws you'd get satisfaction but, you'd be unlikely to see any money. Sadly the act says 'in liquidation' not 'insolvent'.

Still.. if they're trading profitably, maybe just the threat of a petition would get results. Enter into communication. Quote s216 and s217 in your letter or email. Invite response. Ask them why they are still trading as X.
In my experience liars contradict themselves so do your research but don't give it them all at once. Do they have a website? Is it the same one? Chances are they'll have missed something when they edited it. Take screenshots (alt+prtscn) if you find
references to old company name or contracts that pre-date the incorporation.
Keep emailing them. Be polite. Ask if they sold the assets of the old company to the new company? It is legal to set up a phoenix if done correctly so ask if they have court permission for the Phoenix.
Tell them their statutory duty is to their creditors and ask if they have appointed an I.P. The answers to this sort of query can be highly incriminating assuming they can be drawn in.
If this works and you have made them at all nervous try an offer. Say you'll accept X in full and final settlement. Goes down well with judges.

Contract. Is there anything in there? Perhaps something like a guarantee of payment that the director who signed the contract would have known they couldn't pay. (personal liability) look up Tenterden (and quote it)

Is the company limited by shares? If so how much? The directors holding the shares will be liable for that amount. Couple of quid on webcheck will give you a lot of info.

More info would definately help me to offer more advice.

What I did...having acquired a fat file of evidence and conflicting stories was to take it back to small claims and apply for personal liability on the grounds of misfeasance. I know I'm winging it but small claims judges have a lot of leeway and my director has lied in the defence submission by saying the subsiduary I dealt with was subsiduary of another company (that company hadn't been incorporated on that date)

It's highly possible the judge will say it's out of his jurisdiction but worth a go and will give you grounds to prevent the strike-off for a few more months.
Yet more late filing penalties...

Finally: DON'T get obsessed. Try and treat it as a game and don't let it interfere with your life or your business. You are the good guy and what you're doing is helping to protect others. You are doing what is right but if it's harming you more than them, give up and get on with the rest of your life.

Oh and PM me if the Company is in the West Country.

 

[bubblyc]

Does anyone know what can happen if one gives the keys of a property back to bank before they have default due to loss of job no income ?
How easy would it be for the bank to come to UK and would it be worth the cost and expense if once property is sold the dept is not a huge amount?