Winding Up Order

Geoff, the company are still trading I believe? The threat of the Winding-Up Order forces them to pay all creditors who can present proof of their debt to the Court by the hearing date. If the debtor settles with all creditors that have joined the proceedings they can avoid the Winding-Up Order.

Most directors that are involved with shonky business practices would want to avoid compulsory liquidation at all costs – since if they’re found to be culpable they can be held personally liable for any debts. And even if they’re blameless they’ll have to pay back all those Dividends or Directors’ Loans that they’ve no doubt been taking instead of salary.

The last thing anyone wants is for the Winding-Up Order to be granted, but it’s a nice Big Stick to wave at people who CAN pay but WON’T pay.

As for not getting anything back, it’s not nearly as likely as it used to be. Any assets in a liquidated company used to be immediately swallowed up by the debts owed to the IR & HMCE, but nowadays HMRC are in the queue with everyone else.

Posted under Late Payment, Legal Issues

Posted by Alec at 8:23 pm, July 31, 2006

5 Comments so far

  1. Alec added on  August 11th, 2006 at 15:47

    Quote:
    ——————————————————————————–
    however the directors fear nothing because culpability will only be proven if the creditors are willing to pay for an investigation into alleged wrongful trading. in practice nobody is ever willing to throw good money after bad,sadly.
    ——————————————————————————–

    If that’s the case Geoff I’ve never heard of it. I’ve never had to instigate an investigation but I understand that it’s the duty of the Official Receiver to investigate the conduct of companies which are in compulsory liquidation and the duty of the Companies Investigation Branch of the DTI to investigate detailed allegations of wrongdoing concerning companies which are still trading.

    A director who (for example) repeatedly used false company names to hide the true ownership of a business should certainly expect to be investigated by both the DTI and Trading Standards and could expect to be sued by anyone who suffered loss because of those misrepresentations.

  2. Alec added on  August 11th, 2006 at 16:25

    Do you mean the “Official Receiver” – a civil servant, or just an Administrative Receiver, Administrator or Liquidator? They’re very different animals with different people’s interests as their brief.

    Either way if you have clear evidence of wrongdoing which is blatantly ignored by the OR or an Insolvency Practitioner then you should make a formal complaint to the Insolvency Service, who will, at the very least, provide an explanation of why your complaint hasn’t been followed up.

  3. Alec added on  August 11th, 2006 at 16:33

    Of course the IR haven’t got the secondary goal of deliberately destroying the directors’ lives wherever possible, unlike the smaller creditors.

  4. Alec added on  August 13th, 2006 at 14:04

    Geoff, you and Courtney are talking at cross purposes. I suspect that by ‘cronies’ Courtney was referring to the people involved in the company that he has issues with – The Network (Transport Services) Ltd – rather than the people behind Expressnet.

    There’s nothing wrong with the other people behind Expressnet and I suspect they won’t appreciate the implication that they were somehow involved in this other allegedly errant company.

  5. Alec added on  August 13th, 2006 at 15:14

    Geoff, that was/is Expressnet UK Ltd (or something similar) – no problems with them, at least none that the rest of us should be concerned with.

    The Network (Transport Services) Ltd was/is another venture entirely that I believe was meant to be a member of Expressnet. Or maybe it was Wirral Couriers that were the member of Expressnet? Or Speedaway? Or Expressdelivery UK Ltd – which didn’t actually exist but Keith claimed was the name of his new company.

    There did seem to be general obfuscation of mix-and-match business names surrounding Keith’s enterprises didn’t there?

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