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applying for striking off

builder client wishes to start new company and have existing one struck off - his reasoning is that he wants to "draw a line in the sand" and not live with the prospect of liabilities (from customers,suppliers HMRC etc)  crawling out of the woodwork about which he is currently totally unaware. I can understand his viewpoint although it appears slightly paranoid but is there anything inherently "wrong" with his approach.

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By DMGbus
28th Apr 2011 13:48

The concept has merit

I know of two cases where the directors and shareholders sincerely wished that they HAD gone for liquidation years ago as allegedly fraudulent (*) asbestos claims are being made against them and they can't find the details of their Employeers Liability Insurance policies from 30 or 40 years ago.

(*) "jump on the band wagon" claims by individuals who genuinely may have sufferred health issues from asbestos handling but they look up any local long established builders currently around who might have employed anyone to handle asbestos 30 or 40 years ago, and make a claim knowingly against someone who was NOT proven to ever have been their employer.  The Courts support these fraudsters (balance of probability theorem prevails).

The only possible problem with striking off (as opposed to liquidation) is that claimants, I believe, could subsequently apply for company restoration to bring a claim, although I've never heard of it happening, perhaps it's more a theory than something that really could happen.

 

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By blok
28th Apr 2011 14:21

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We currently have had a client company restored to the register by an ex-employee who came out of the woodwork and is claiming under a no win no fee compensation case for a fall he had one year before the company ceased trading.  Companies Act s1030 allowed it to happen. 

I also dont think it would have made any difference had the company been liquidated.

Stressful times for the now retired directors...

 

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29th Apr 2011 13:48

I'm not sure I understand the significance of restoration

Surely, even if you get the company restored, its got no assets, so how do the claimants recover any money? The directors would only be personally liable if the claimant could prove they had done something wrong, which can't be that easy.

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29th Apr 2011 13:48

I'm not sure I understand the significance of restoration

Surely, even if you get the company restored, its got no assets, so how do the claimants recover any money? The directors would only be personally liable if the claimant could prove they had done something wrong, which can't be that easy.

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By blok
29th Apr 2011 14:52

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The company has no assets upon restoration, however it did have a pi policy. The company needs to exists for the claim to proceed. As far as the directors a concerned they removed the money from the company prior to strike off (as shareholders). Granted there may not be anything for the directors to do but there is an excess and they could do without the hassle.

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By blok
29th Apr 2011 14:52

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The company has no assets upon restoration, however it did have a pi policy. The company needs to exists for the claim to proceed. As far as the directors a concerned they removed the money from the company prior to strike off (as shareholders). Granted there may not be anything for the directors to do but there is an excess and they could do without the hassle.

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By Monsoon
29th Apr 2011 15:42

but if there are no assets in the company
It can't pay the excess. Are the directors liable to pay it personally?? I wouldn't have though so.

With regards the OP i don't see a major problem with it as long as it's done properly and there is an argument to say it's eminently sensible.

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By blok
29th Apr 2011 20:12

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Don't know either, only time will tell.

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03rd May 2011 10:06

thanks everyone for comments

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