Any advice appreciated!

Thenavigator

Where to start, firstly thanks for reading this and hopefully giving me some advice.

I had a limited company which went into liquidation in January 2014 With this company closing I had to open another one so I could continue to work. In February 2014 I opened new company which had same name as old one with just UK at the end.

I was trading with a supplier and have hit problems at end of last year as other suppliers were wary and not offering credit terms so made things impossible. I'm now about to liquidate again however one of my creditors has hit me with a claim in a County Court claiming that I should be held personally responsible for debt as I did not gave permission to use trading name. The company they employed are Harper Cross Associates in Newcastle. I have spoken to their legal department on Friday and they are saying I should have had permission to use company name as it is similar to my old company. I owe the company that set Harper Cross Associates on me £26,890 and don't have it to pay.

I always thought limited company meant no personal responsibility but Harper Cross are saying no and I gave to respond to Court now!

fishybusiness

I always thought limited company meant no personal responsibility but Harper Cross are saying no and I gave to respond to Court now!

Depends, I'm no expert but do know I have given some kind of personal guarantee on money I borrowed in the past - not all debt is the same with ltd's.

Perhaps half an hour with a legal eagle is your best way forward.

bris

You seem like a cowboy so hopefully you will be held accountable for your actions.

Thenavigator

I am far from a cowboy! I just couldn't get credit to run my business and couldn't cash flow without it.

Going from the particulars of claim from Harper Cross Associates they have claimed to have held me responsible due to section 217 of the insolvency act. I don't have the money. They said that I should have got permission from the Court to use the name I used as it was a forbidden name.

Surely I can't be the only person in this position. Does anyone have any constructive advice?

Opinion

Liquidating twice in under two years? Trying to run your business on credit? Cowboy. As said, hope you get held accountable.

Savvy_Sue

fishybusiness wrote: »

Perhaps half an hour with a legal eagle is your best way forward.

This is the most constructive advice anyone can give you.

fishybusiness

Insolvency law Section 216 says....

....restricts the re-use of a name previously used by a company that has gone into insolvent liquidation

The names become prohibited names.

A prohibited name is a name by which the liquidated company was known at any time in the 12 months immediately before the liquidation: whether this is its registered name at Companies House, or its trading name, or any name so similar to its registered or trading name as to suggest an association with the liquidated company.

To prevent a business going under with creditors, starting up again the next day, using old custom and losing the debt.

Section 217 says...

Personal liability for debts, following contravention of s. 216.

(1)A person is personally responsible for all the relevant debts of a company if at any time—
(a)in contravention of section 216, he is involved in the management of the company, or
(b)as a person who is involved in the management of the company, he acts or is willing to act on instructions given (without the leave of the court) by a person whom he knows at that time to be in contravention in relation to the company of section 216.

From what you have written here

I had a limited company which went into liquidation in January 2014 With this company closing I had to open another one so I could continue to work. In February 2014 I opened new company which had same name as old one with just UK at the end.

It appears you have done just that, which is illegal under Section 216, best go get some legal advice......

Thenavigator

Have spoken to solicitor and have an appointment at 12 noon to discuss. Thanks everyone, will update you after meeting.

antrobus

fishybusiness wrote: »

.....It appears you have done just that, which is illegal under Section 216, best go get some legal advice......

And to be clear, "illegal" means it is a criminal offence, and what's more it's a strict liability offence, which means if they can prove you did it, you're guilty, no wriggling out of it because you didn't mean to do it.

Mistral001

Good you are seeing a solicitor.

Thenavigator

Well it wasnt what I expected. Solicitor has spoken to Harper Cross Associates who have been appointed to deal with it. The chap he spoke to there was not very helpful and when the solicitor asked to speak with the Manager Alex Findley he was abrupt and to the point, he would not negotiate or resolve it. He wants full payment or he is filling for bankruptcy after the CCJ if not paid. They are just bullies in suits, they dont care that i am losing my business.

Solicitor is saying that the case is daming and stated that it is very unusual for a creditor to go this far. Seems like I have no option but I cant raise the funds and by the time i remortgage they will have a ccj against me which will make a remortgage impossible.

any other advice, thei solicitor is saying he can try and hold Harper Cross at bay but thinks its unlikely as they are being too aggressive in approach.