My cowboy builder has gone limited

annieb1981

We have started legal proceedings against our builder but he has in the last 3 months registered as a limited company. We are just about to initiate official court proceedings. For the last year we sent 2 legal letters which he did not respond to. We have then been having surveys and organising expert witness reports and have just found out that he has incorporated into a limited company with a new address that is no longer his house address. What can this mean for us?

ElephantBoy57

I guess he wasn't a limited company when he did the work, I would think it would be classed as a different firm. It won't work retrospectively. I am sure someone will be along soon with a more expert opinion.

bris

If he undertook the work with you as a sole trader then thats on him personally. Going limited now will not protect him from past work.

annieb1981

bris said:

If he undertook the work with you as a sole trader then thats on him personally. Going limited now will not protect him from past work.

What about his assets would they not all be tied up in the limited company now? Wont get speaking to out solicitor until end of the week, I am going a bit mad here wondering how this changes things. does this mean he has things he wants to protect rather than he has nothing to give?

tacpot12

He will have trouble putting his home into his limited company.

Ectophile

Generally, you set up a limited company to separate the business from your assets.

If a company goes bust, then everything that company owns can be sold off to pay the creditors.  If you put your home in the name of the company, that would leave you homeless.  Much smarted to keep your assets in your name, and make sure the company has nothing worth taking.

If your contract was with the builder as a sole trader, then your claim is against the builder.  If you win, you can claim off his personal assets.

annieb1981

Ectophile said:

Generally, you set up a limited company to separate the business from your assets.

If a company goes bust, then everything that company owns can be sold off to pay the creditors.  If you put your home in the name of the company, that would leave you homeless.  Much smarted to keep your assets in your name, and make sure the company has nothing worth taking.

If your contract was with the builder as a sole trader, then your claim is against the builder.  If you win, you can claim off his personal assets.

I can view his application for going limited and he had used a different address for contact details. Instead of his usual home address he has used an address which is literally a field they own across the road from their house,  what is with that? He has also got his business address changed from his home which is where it usually was under his registered business to a business park in the next town over from him. Is he thinking if he does this it saves his house? I didnt think you could take someones house but more the contents of they didn't pay up.

Doozergirl

The incorporation has literally nothing to do you with you or your case.   Your case is a personal one against him and that is a benefit to you.   The company is totally and utterly irrelevant.  

(It's usual to register the company somewhere other than the director's home address, otherwise your full details are out there in the public domain along with dates of birth etc.). 

annieb1981

Doozergirl said:

The incorporation has literally nothing to do you with you or your case.   Your case is a personal one against him and that is a benefit to you.   The company is totally and utterly irrelevant.  

Ok, so if the court rules in our favour that he owes us 'X' amount, just because he has gone limited doesnt get him out of paying it? And he may be forced to use his assets for this?

comeandgo

If he has any assets.   The usual for self employed is have everything in wife's name.

Mistral001

Your contract is with him personally.  The fact that he has formed a Ltd company has no bearing on that.  If he thinks that will protect him, he is mistaken.  However, he could make himself, what is called, a "man of straw" by putting his assets such a his house, car etc in someone else's name.   That will protect him to a certain degree.  See solicitor for proper advice.