Sorry - asking similar questions! Enforcing a private loan without a contract

bigadaj

jonesMUFCforever wrote: »

Directors are equally liable for debts of a limited company.
Whatever debts the limited company has has to be covered by the directors.
Was this by bank overdraft ? If so it is unusual for a bank to grant o/d facilities without taking out director guarantees.
Did this happen?

I love this idea, if only then Fred Goodwin wouldn't have just to worry about his knighthood being stripped!

marmite_hater

The company folded with all debts paid (by the skin of their teeth and by selling equipment etc) to take them back to zero except for the money he had borrowed from friends to keep them afloat, and the money back to her mother. As a result of closing the business at zero, this is how his own finances are so in the red.

The vehicles was bought for approx £15k - which the mother took back when he was trying to sell it and sold it for half what it was worth.

marmite_hater

jonesMUFCforever wrote: »

Directors are equally liable for debts of a limited company.
Whatever debts the limited company has has to be covered by the directors.
Was this by bank overdraft ? If so it is unusual for a bank to grant o/d facilities without taking out director guarantees.
Did this happen?

My understanding is that a limited company is one in which the liability of the directors is limited to what they have invested in the company.So if the company goes under the debt goes with it? Is that not right?

jonesMUFCforever

I wanted the OP to confirm whether the overdraft was covered by a directors guarantee.
If there is no such guarantee the ltd company debts will die with it if there are no assets.

marmite_hater

jonesMUFCforever wrote: »

I wanted the OP to confirm whether the overdraft was covered by a directors guarantee.
If there is no such guarantee the ltd company debts will die with it if there are no assets.

No directors guarantee as far as I know. Assets would have to have been bought during the time the business was afloat right? She is now trying to take his own personal equipment that he has had for years - which also takes his livelihood away.

Thanks for all your help everyone. What you have stated is pretty much what we have told him anyway, but with the constant harrassment and threats, and the fact that he wont just walk away because they have children together, he pretty much feels on the edge. Lesson is never borrow from family or friends!