CCJ, Third party order Now court date...what next? Advice please

LeBronTHYP

I have a CCJ awarded against a tradesman for around £2k, took half of full payment and didn't do they work. They didn't even defend it.

Now had third party order (has £1 in account!) and a hearing at the start of next year.

What are the options now? it's a one man Ltd company. Is it worth sending bailiffs to their home?

Am I just wasting my time, as it's a ltd company. What's the point of the law if you commit fraud by just transferring from the company to a personal account, no intention of doing the work.

Can you go after their personal assets?

If they no show , to the hearing, that's contempt of court and they could get jail time? Is it worth trying to get them struck off as a director?

Advice welcome. TIA

A_Geordie

Hi responses to your questions below.

1. Third party orders are practically useless unless you know a bank account with money to cover the cost and the defendant has not been tipped off.

2. What is the hearing for? Has the individual been ordered by the court to personally attend the hearing or is it the company?

3. Limited companies are used to separate personal liability. One man companies are always going to be risky and you should do your due diligence before contracting. Payments up front before work has started is always a big no no and should be done in stages. If a company wants up front payment, find someone that will agree staged payments. 

4. No you can't go after personal assets. If there is evidence the individual has funnelled company funds to a personal account, the individual might be deemed to be holding those funds 'on trust' for the company. Personal liability might attach that way but this is far beyond the remit of this forum and you would need specialist advice. Likely not worth it given the amount involved as it will likely cost you about the same if not more for the advice than what you are claiming. 

5. Whether the individual will be in contempt of court depends if the court has personally ordered his attendance. If yes, failure to show will be considered contempt but you can only bring contempt of court proceedings in the High Court which means more cost and expense. The individual could avoid any jail time by agreeing to attend a hearing and the court will probably grant that.

6. You should report them to the Insolvency Service but you are unlikely to hear back from them in terms of what action they may or may not take especially if the company is still active. You can make a complaint here: Complain about a limited company - GOV.UK

TheSpectator

Long story short, you are throwing good money after bad.

LeBronTHYP

Thank you, I'll take that advice. I can see it's not really going anywhere or enforceable.

TheSpectator said:

Long story short, you are throwing good money after bad.

DullGreyGuy

A_Geordie said:

Limited companies are used to separate personal liability. One man companies are always going to be risky and you should do your due diligence before contracting. Payments up front before work has started is always a big no no and should be done in stages. If a company wants up front payment, find someone that will agree staged payments. 

They were doing staged payments hence it was only 50% up front

LeBronTHYP said:

I have a CCJ awarded against a tradesman for around £2k, took half of full payment and didn't do they work. They didn't even defend it.

Now had third party order (has £1 in account!) and a hearing at the start of next year.

What are the options now? it's a one man Ltd company. Is it worth sending bailiffs to their home?

Am I just wasting my time, as it's a ltd company. What's the point of the law if you commit fraud by just transferring from the company to a personal account, no intention of doing the work.

Can you go after their personal assets?

If they no show , to the hearing, that's contempt of court and they could get jail time? Is it worth trying to get them struck off as a director?

Generally no, a company is a separate legal entity to the directors and shareholders (who may or may not be the same persons) hence some will require personal guarantees from directors when dealing with small businesses.  Ultimately it comes down to how much time you want to spend on the matter if you accept you have a low chance of getting the money back?

They cannot just "take the money out into a personal account", plus all you know is that the money isn't in the account you have a charge over, it could have been moved to a different account held by the company with another bank. 

If it has been paid to him personally then it must be by an allowable route like dividends, salary or a directors loan. Presumably the court hearing is for the company to declare its financial position? Ultimately you can partition for the company to be wound up but the costs in doing so are more than what you are owed. The liquidator would look through the companies records and will reverse inappropriate payments etc but it also depends on the director/shareholders having the funds to pay it back.

Unfortunately liquidators are pragmatic people, our favourite local butcher went into administration in 2022 with the company being owed nearly £200k by its directors. in 2023 the administrators agreed a settlement of £100k and when I last looked a couple of months ago £20k had actually been received.  The receivership there has almost cost £100,000 so even if the loan was repaid it only covers the administrators fees

So technically you have options but they could end up costing you more money and still leave you with nothing. Add to that your time and its unlikely to make economic sense to keep pursuing it but some will on "the principle" even if it means they lose more. 

pinkshoes

You're potentially throwing good money after bad. 

But sometimes if you have some money then it's just the principle, and even though it's unlikely to get you any money back, you could at least get the business wound up. He'll no doubt just start another though. Some people just do this over and over... I think there's a possibility of getting him banned from being a director somehow though.

Another option is the power of social media. You are more than welcome to leave factual reviews of the individual and let others know what happened so that they might not fall into the same trap, along with a CCTV image of him and any other details you have. It might not get you your money back, but it might prevent others from losing money, and will hopefully cost him more than £2000 in contracts. 

Good Luck!