Can you please advise?

[Con]

the company i do business with has laid off all it's office staff but has not yet called in administrators or receivers after two weeks. The directors are continuing to trade although there are no longer any funds in the business and they owe me a considerable sum in fees. I suspect that the delay in going into receivership is to await funds coming into the business and for the directors to take this money before declaring that they are no longer trading or else they wish to continue the illusion of trading to encourage a buyer or a new start up.

In any event I would like to know if or should I freeze their bank account in an effort to secure some of my outstanding debt should they receive funds in the near future and how is the best way of doing this?

The fees owed to me were paid for my services in good faith by a third party via this company and as they have kept and spent these funds on other things I am led to believe this is illegal. Can you please advise?

[MelanieGiles]

The only way you could do this is by serving them with a winding-up petition, and if you have taken no steps to enforce the debt in advance this could prove difficult.

A Garnishee Order could also provide you with some security over monies yet to be received, but again would take some time to put in place, and without the proof of a judgement debt behind you it might be difficult to persuade a judge to make an order.

How much are you owed?

[Con]

The only way you could do this is by serving them with a winding-up petition, and if you have taken no steps to enforce the debt in advance this could prove difficult.

A Garnishee Order could also provide you with some security over monies yet to be received, but again would take some time to put in place, and without the proof of a judgement debt behind you it might be difficult to persuade a judge to make an order.

How much are you owed?

I have always invoiced timeously and sent monthly statements stating clearly that fees were long overdue, requesting immediate payment. The outstanding debt has always been acknowledged by the company as being factual and they have responded with various reasons for not paying.....cashflow etc.. These exchanges are all on file and I have pursued the debt in the normal business way. The sum in question is nearly 50k and this has been used over past few months to pay office salaries and other expenses. In addition to the fees owed to me I earned much larger fees for the company itself at the same time! Is this underhand practice legal or can the directors be taken to task in some way? I have also discovered that one of the directors resigned his post on the same day as redundancies were made. Would this mean that there would be no liability attached to this person for any wrong doing which may be subsequently discovered? Many thanks. Con

[MelanieGiles]

If the directors of this company have been trading whilst insolvent, they could be deemed to be held personally liable for the losses made. This may also led to them being disqualified from acting as directors for between 2 and 25 years - and this does include anyone who has been involved with the business as either a director or a shadow director for the last three years.

[Con]

If the directors of this company have been trading whilst insolvent, they could be deemed to be held personally liable for the losses made. This may also led to them being disqualified from acting as directors for between 2 and 25 years - and this does include anyone who has been involved with the business as either a director or a shadow director for the last three years.

Thank you for this very useful information. In your opinion what would the best option to take from here in an attempt to recover at least some money?
I realise it will depend on where I come on the list of creditors but if a receiver were to be appointed I would then feel something of the situation may be saved before the company is completely stripped of all assets. How could I make this happen? Many thanks, Con.

[MelanieGiles]

You could petition for the company's winding up - but this is likely to cost in the region of £2,000 and you would really need a lawyer to act for you. If you really wanted to dig deep into your pockets, you could also apply for an Administration Order which would see an IP appointed immediately, but this should only be done if you truly believe that there are assets at risk which could be realised and paid to creditors - and this would be very expensive to do.

[Con]

You could petition for the company's winding up - but this is likely to cost in the region of £2,000 and you would really need a lawyer to act for you. If you really wanted to dig deep into your pockets, you could also apply for an Administration Order which would see an IP appointed immediately, but this should only be done if you truly believe that there are assets at risk which could be realised and paid to creditors - and this would be very expensive to do.

Thank you for the advice. Do I take it that the MD of the company who was ultimately responsible for diverting my fees elsewhere instead of passing them to me is not personally liable for any legal repercussions? Con

[MelanieGiles]

I cannot possibly comment about individual cases, as I have no detailed knowledge of your situation Con, but my previous reply stands.

[Con]

Many thanks for all advice. Con