I need to become a director of a dormant company. The current directors have been very slack and filed accounts late in 4 of the last 6 years. I am trying to push them to get things in order before I become a director myself but there is some resistance and withholding of information. They have finally filed last year's accounts... 6 months late! How can I find out whether a late filing penalty has been issued...and more importantly if it has been paid ...for this year and prior. If the directors won't tell me, will Companies House share this information on request? I am aware that as soon as I am appointed as a director then I will automatically become liable for any unpaid fines which obviously is not a situation I'm prepared to put myself in.
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Penalty
Easy, Filed on time no penalty
Filed late a penalty
Companies house should not pass out any details that are not in the public domain.
Payment of penalties is not in the public domain
I assume there is not an independent property management agent or accountant.
Paul is correct - Companies House penalties are automatic. If its late, one will be issued. If its not paid, COHwill send the boys round, so it will be paid.
As a director, you will not be personally liable for a filing penalty. That isn't how limited liability works. Only in certain circumstances (usually wrongful trading) would you be liable. The CH penalty will never be that.
But either way, its not a good look for a company to be constantly late filing their accounts.
I'm obviously missing some (unstated) fundamental 'thing' here ... why do you need to become a director of a dormant company that, by the sound of it, has no assets or cash and a history of late filing for even its limited (poor pun) liabilities?
Although it's a bit of a non sequitur to say "The other listed directors should not be active any more ..they sold some years ago", you could indeed track them down and 'encourage' them to resign ... which might then leave only your recalcitrant director to face the music (of penalties or whatever)?
Ahhhh. A flat management company that probably owns the freehold of the building you lease, with all(?) lessees as members......?
This forum is entirely the wrong place to ask, but Landlordzone forums (which is the right place) aren't anywhere near as good as they used to be.
Try here: https://forums.landlordzone.co.uk/
Incidently (and speaking as someone who has been in your boat):
1. The penalty HAS to be paid. The company will end up having to foot the bill.
2. You're unlikely to get the errant director to pay.
3. You'll probably find the Articles of Association prevent non-members being directors - so there is more than just the unpaid filing penalty that is a problem.
4. I disagree with current thinking that Flat Management Companies are dormant, though I realise I'm rowing against the tide here, but how can a company be dormant if it employs a gardener, pays maintenance etc? That's a long winded technical discussion best left for another time.
5. Don't let the company be struck off. It is likely to be named in your lease, and may also own your freehold. Striking off is really bad.
"But if there isn't enough money in the management pot and the debt goes unpaid then ultimately COs House will chase individuals??"
I have never seen companies house chase directors ref fines - i suspect their route would only ever be to wind up the company. So you may find a real mess when you are appointed.
Practicably speaking what you class as negligent others may see as reasonable excuse - so be careful with going ott if that is not necessary to minimise "future" issues - ie be prepeared to swallow and park the past.
I supsect you will have to take the plunge before you see the warts - so perhaps give yourself a get out route to resign if its worse than you expect. Unless the other person has good specific reason to not want you on board and or not to want to relinquish control they will probably be over the moon that someone is taking up the slack - that should become evident very quickly. Its fairly common for companies like this to be a shambles where some people are putting their interests first and or no one is doing a proepr job. In some respects sucking it up and not over criticising the numpty in charge is probably the way to go here.
@Jaks my experience of flat management companies from my professional life is "keep well away" so if you are stepping up to the plate and getting this sorted out I imagine everyone else will be delighted.
They really are not hard to do administratively. All the problems come from (in reverse order) (c) people not knowing what they are doing (b) people not giving a stuff about it, and top of the list (a) disputes between leaseholders
It could be even worse than that.
Normally, flat management companies are limited by guarantee, with it written in that the members of the company are the flat lessees and may also be directors (I've seen plenty of flat management companies were non members are directors - which is usually not allowed by sensible Articles - but Companies House don't police that - technically therefore all the transactions are ultra-vires - go look it up).
If you've got an old company (having to request the Articles suggests its old) might mean the company is limited by shares. This is unusual now but used to happen a lot in the 1980s. Guess what?! That's right, the shareholders might not be the lessees anymore.
I've seen:
Flat management company incorporated. Four flats, four shareholders. A, B, C, D.
After five years, A sells his lease to E, but boneheaded conveyance solicitors only sells lease. A remains the shareholder (without even knowing).
Rinse and repeat.
Twenty years later, a problem arises and E, F, G and H find that they are all lessees, but the shareholders of the company that owns the freehold are still A, B, C and D. Or even worse, the Executors of A, the spouse of B, the son of C and the niece of D.
Complete disaster.
You ARE limited by guarantee..... aren't you?