Business debtor

MikaDavid

Hi there,

I am just wondering if anybody out there may have some advice for me please. We run our own small business and worked for a client for 3 months last year for a particular project. We billed them weekly with 30 days to pay. We had worked for the same company 3 times previously with no problems. Part of the way through the job we discovered that another company had been set up incase the project wasnt as succesful as hoped ,with the plan being that the new business name be dissolved if no money was made, but the original business would be able to continue to trade with no links to this project whatsoever. We were asked to make invoices out to the new company which we refused to do. We did question if we would get paid and as we had long standing history with this company accepted the gentlemans agreement(stupidly) that we were at the top of the payments lists and that the new company was only set up as a precaution.We possibly should have walked away from the job at that point, but firstly we were working abroad and had turned down at least 6 other projects for that time scale, and being a small industry and very tight knit had we walked away and the project been successful our reputation could have been in tatters for leaving them high and dry and we may have struggled to find more work anyway. ( Am i making sense so far ?) Anyway to cut a long story short, we recieved payments for some of the invoices, but since August last year they have owed us £8500.00 which has put us financially in a very difficult predicament as we were already struggling having had a few other companies cease trading owing us money , the bank pulled the plug on our overdraft etc etc.

My question is, is where do we go from here ? Despite numerous requests letters , phone calls for the money we are told that they have no money and cannnot pay but assuring us that as soon as they do, after their next big project in 2012 (!!) that we will be paid.They even had the audacity to asked us to work for them again in 2012, despite being unpaid ! We have recently discovered that the second company set up last year, they have infact dissolved and looking at a credit check system we have with our bank, it does appear that the original company is also in financial difficulty. Should we be employing the services of a debt collection agency to try to obtain the money or take the company to the small claims court ? Is this an option ? All our invoices were made out to the original company which is still trading. Any advice, big or small would be much appreciated.

Apologies if I have posted this int he wrong place, I have only ever posted once before a few years ago and still a little unsure of the set up !!

happycamel_2

This link should help http://www.businesslink.gov.uk/bdotg/action/detail?itemId=1073791107&type=RESOURCES

I think that ultimately you can apply for a winding up order.

DizzyDizzy

You could ring the busines debt line 0800 197 6026. The are run by the Money Adviice Trust who are a registered charity and give advice to small business and the self employed regarding debts.

MikaDavid

Thankyou to both of you, I will give them a call tomorrow. We did speak to the Business Debtline a few years ago for some other advice but I must admit I didnt even think about calling them re this.

Your replies are much appreciated.