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Run my own small ltd company, which 18 months ago suffered a 20K bad debt.
Someone we had done some work for dissolved his ltd company even though I had sent evidence to companies house detailing why it could not be dissolved.
Have been contacted by Commercial & Domestic Investigations who claim they can recover the money, they have checked the Director of the dissolved company and claim he has other unpaid CCJ's to his name (he is a slippery weasel and knows how to play the system)
Stumbling block is they are after £400 plus VAT for me to sign up to their Premium Service for 1 year?
Are they just making money off people like me who in the current climate have suffered financial losses without any hope of reclaiming money for me?
They say they will go directly for the Director as he has committed fraud (which he has), they have done some checking into the background as they said the directors name today, and I hadn't mentioned his name when I spoke to them yestarday.
You could suggest to them that when you have the money from your debt they will get there £400. I would be very reluctant to give them any money up front.
My initial thoughts as well lunge, dangling a little £400 carrot with they say a good chance of getting £20K
I did a google search on them, couldn't find much mostly other sites with their adverts on.
I'd be asking who they think is going to pay up the money that is owed. If it was a limited company then the director is most likely not legally responsible for paying out. Hence the fact he could fold the company and walk away.
phil.w, I know what your saying re ltd company, he did commit fraud by allowing companies house to disslove the ltd company.
I also have been told (by the third party where the work was carried out)that they paid the Director via his non ltd partnership (which is still running) not the ltd company.
These things are rarely black and white which always confuses us non legal types.
You can apply to have any company reinstated by Companies House, and once done you can continue to chase the debt. Obviously he will then have to go through an insolvency if he's going to try and avoid but no doubt you'll be the only creditor so whatever assets were listed against the business will be sold by whatever IP is appointed, and you may get some dregs. Will also result in the accounts being looked at.
This can be done fairly easily through any solicitor.
There are certain circumstances that remove the protection afforded by a LTD company, mainly trading while insolvent, or using the trading name of a previous insolvent company (criminal offence). If he's done either then the liability becomes his personally and is worth chasing.
As to the upfront fee, no chance. If they are that confident that they can achieve any result they should be willing to cover the cost.
No way should any one be trying to charge you an upfront fee.
If you do decide to use a Debt recovery firm you should really be considering one who will "buy " the debt off you. You won't get the full 20k but a percentage based on how good a prospect he recovery is as far as the recovery firm see things, the more they are likely to get the more they will pay for the debt.
If you want a contact I have a company that I use for such purposes who don't charge until the debt is collected. They have done a couple cases for me and have been brilliant - send me an email and I'll get you his details.
My relevant legal knowledge on this area is dangerously out of date, but there are only two practical possibilities, either the debt is going to be relatively straight forward to chase in which case sell it on or use some one who does not want an upfront fee or the debtor has dodged it by collapsing the company in which case £400 in an upfront fee is good money after bad.
Are you really sure they can go for the director ? proving Fraud will be a criminal case... Was the company dissolved or liquidated ?
Are you just a victim of one of the many companies who went bust during the recesion ?
Finally.. if you go for him, through the vultures who are praying on this kind of case following recesion, are you sure the director has the means to pay ? are all his assets in wifes name ? is he worth anything ?
In the end, you may have a long legal battle, get yourself all wound up, spend a lot chasing it.. and end up being paid £1 a week for 385 years.
Couple of things...
(1) If the debt is with the limited company then that's initially where your claim lies as you know - but that entity's been dissolved. Have you approached Companies House to find out why they didn't act? Or did they strike it off for non-filing rather than a directors' application?
(2) There isn't any automatic liability for directors of companies a case has got to be proven against them (usually in Court) this might involve restoring the company to the Register (£1500+) and appointing a liquidator.
(3) If he has other unpaid CCJ's personally what makes the debt collector think that he can/ will pay yours - he might not have the means or you might need to enforce judgement (more cost).
(4) If the agent issues a court claim and the director contests it or wins you are exposed to paying for his costs.
(5) Anyone with £1 can find out who the director of a company is and they're probably on a subscription service where it will take 10-15 seconds to look up so don't be that impressed by the fact that they know who the director is.
I'd say an upfront fee is good money after bad. Better having a word with a qualified insolvency practitioner (who could probably take 10 minutes to look at whether there's anything in the published accounts that would make it worth restoring the company) or a litigation lawyer.
To be honest (and from personal experience) its nigh on impossible to remove the veil of incorporation, which is the protection given to the directors by the limited company.
Even if the Director is blatantly fraudulent in his actions, if he is doing so through and for the benefit of the company, and not using the company to cover his personal fraud / gains, then he's basically untouchable.
Its only if his actions contravene the Companies Act, or cross over into criminal activity as opposed to Civil that you've got any chance of instigating action and I doubt there would be any resultant payout to damaged parties.
So you ar much better off going for the company itself.
As above would defo pay to visit the Companies house website and purchase the financial reports submitted, they are only £1 and will give some insight into the financial position of the company when it was removed, potentially P&L's and Balance sheets which will give a clearer picture of what there is to go after.
If the director applied to have it removed while it was still trading, and there was no insolvency. They can only file this application (called a DS01) if they have no outstanding legal proceedings, haven't recently sold off any assets, and have not been trading for three months so the financial position shouldn't be to much different to the companies house reports.
Given the current climate, if there was anything with some meat on it I'd assume most solicitors would be more than happy to take on this kind of work for a % fee.
You have six years to petition the return of the company, and once reinstated the company continues as if never struck off, and one of the applicable parties is anyone who has had a contractual relationship with the company or who had a potential legal claim against the company ... which sounds like yourself.
Went through similar after a Ltd company went through a Pheonix restructure, we had just placed a substantial order with them which surprisingly wasn't transferred to the company that "opened" the following week.
While it was substantially less than your loss, by simply commencing the process a payment eventuated miraculously from the ex-director. We were also benefitted by the fact he had retained the trading name of the previous company, so had not only lost the veil of incorporation for his "new" company, but also as was pointed out to him committing a criminal offence.
PS ... and if you haven't done so already, and the transaction was VAT'ed and you don't run a cash book accounting scheme you can write off the bad debt with HMRC and reclaim any VAT paid to them as a result of the transaction.