Client Gone Belly up Can I Keep the Car?

**fckvwls** · 13 March 2009, 11:09

Originally posted by LittlestHobbo View Post

Can I keep it till they pay me or have it in liu of what they owe me.

Based on nothing more than gut feeling I would say No.

**LittlestHobbo** · 13 March 2009, 11:12

yeah thats my well gutted feeling as well, oh well back to life on the streets..

**LittlestHobbo** · 13 March 2009, 11:13

sorry should have posted in Legal, can someone move me?

**pmeswani** · 13 March 2009, 11:15

Originally posted by LittlestHobbo View Post

Don't if anyone can help me here I am waiting for some legal advice as well..

My major client has just gone belly up and owes me £6k which I'm not expecting to see being quite a long way down the line of importancy when it comes to creditors and they even unsure about paying upto date wages.

However I do have 1 of their cars in a rolling monthly rental agreement, which was renewed yesterday.

Can I keep it till they pay me or have it in liu of what they owe me.

Also my contract was Time and Materials based with no cancellation clause on their part so technicaclly do they actually owe me the cost of the entire remainding contract some £50k.

Any advice would be appreciated!

Thanks

No matter how I look at this, I come to the same answer. No.

If the asset belongs to the company, then the administrator's (or whoevever is winding down the company) owns the car. If the leasing company owns the car, then you will need to return it back to them, unless you have a direct contract with them.

If the car is client property, then the secured creditors (of which you are probably not) will be entitled to claim their cut first, which may result in selling the car.

There are a number of ways of looking at this, but I cannot see a way of saying yes.

In terms of the contract, as there is no work, and no money, how do you intend on enforcing the clause in the contract (if any) to reclaim the remainder of £50k?

Regarding the outstanding £6k, if you have invoiced them, then stand in line to get the money, if any is left. My advice is to put a claim via the Small Claims court (on behalf of the business) and wait in line. However, I am certain there are people here who can offer better advice.

**TykeMerc** · 13 March 2009, 11:19

If the car belongs to them you can contact their liquidators and take out a lien against their asset for the debt, but that's not a trivial task.

Odds are it's actually rented from a car company so it's their asset and not your clients.

I'm sad for you, I had something similar happen to me a over decade ago which is why I stopped doing business direct with clients and started contracting via agencies, it's really incredibly annoying.

**LittlestHobbo** · 13 March 2009, 11:27

cheers, that is pretty much how i think the land lies as well, The company is actually a Vehicle Rental company who own the car, that I did the work for.

re: The contract clause, while i was at another company recently they had to pay a huge sum of money to Fujitsu to get out of an outsourcing contract.

I'm not sure what the upshot was but at one point it looked like they were just going to have to give them the remainder of the contract cost to buy themselves out, I don't know how it ended but my point (there is one) is that whilst i realsie their is no money to pay it are they still liable for the full cost.

As the car I have is worth considerably more than the £6k invoiced they owe, I could possibly tag that on and keep the car...

But I think the credititors priority will prevail, so it won;t even be an option. It could however help any IR35 as it shows that the company took a big hit and made a loss on the contract, proving substantial risk..

**LittlestHobbo** · 13 March 2009, 11:47

ok the Leins route sounds interesting, how complicated is it and what does it involve, if it means a load of legal rangling thats fine i have legal insurance and i'd just like to keep the car as long as possible so I don;t have to buy another one!

At the end of the day i guess its a fight for the assets..

Thanks for the advice, and your right it is very annoying but fortunatly It was a decent rate and I have some put by. Its alot worse for their 700 or so employees quite a few I worked with closely - yesterday was a strange old day and one I wouldn't like to repeat too often.

**TykeMerc** · 13 March 2009, 11:53

You will need proper legal advice to sort out a lien, on the marginally plus side of the equation you have posession of their asset and you shouldn't give it up without a court order/warrant, but again you need proper advice on exactly what you can do and remain on the right side of the law.

**LittlestHobbo** · 13 March 2009, 13:31

thanks for the advice

Client Gone Belly up Can I Keep the Car?