Director's Liability

[ladymuck]

thanks to you both, you've given me lots of hints and things to look into/think about.

[boredsenseless]

Where can I find out just how much protection a Ltd Co Director/Owner has?

Still trying to get paid from my ex-friend and I want to sue the ass off her but don't want to go through all that hassle if I'm not going to get anywhere. Tried www.recoveryourdebts.com as suggested by one of you chaps but they won't take on the full recovery because her Ltd Co fell way short of their solvency checks (no surprise there) - hence why I want to sue her rather than the company. My argument is that she knew the company had no money but still strung me along saying she was organising a business start-up loan in order to get me to continue working for her.

Any advice, pointers, blah, blah, all gratefully received.

private eye is correct that you can't do anything to your 'friend' until the company is wound up as until that point your grievance is with the company.

Even if you succeed in winding up the company you need to be able to prove that your friend 'lied' to you. Do you have emails or letters stating the fact that a loan was being facilitated. If not then you can't use it.

Also in the above all she needs is a letter form a bank to say that they refused the loan, at that point it would seem that your friend did all in their power to obtain the loan.

It appears that you may have been unfotunate to have picked an insolvent company, if there is no funds in the company and your friend either cannot be pinned down documentarily to promising the loan, or can prove they applied and were turned down then you probably can't do anything to them either.

Debt collection and winding up orders remain your best option. At least if you wind up the company they will be barred from directorships for a period.

[privateeye]

The Insolvency Act may be your best option. This would have to be against the Ltd Co unfortunately but having put the Ltd Co into liquidation you will have the option of trying to enforce either/all of the following which are directed against the director(s):

1. Wrongful Trading
2. Preference
3. Fraudulent Trading

Most of the above basically mean that a director knowingly made promises that they could/would not be in a position to honour and this makes them personally liable.

I used the above as a PROMISE to an Agent a few years ago after he suggested that as they were Ltd Co there was nothing I could do when the money was spent elsewhere - all money owing was paid during the hearing with the agency director in tears. The agent had put in an email that as he was Ltd Co I could not touch him - this was the vital evidence that would have imprisoned him as it basically admitted he was hiding behind Ltd Co as a way of avoiding payment. Had the agency been liquidated I had the evidence to finish the director off personally, as he did clear the debt -unfortunatley the law allowed no further action. I did have the personal pleasure of being with the Court Bailiffs when we repossessed his Merc to pay the court costs.

I would strongly suggest that you seek professional advice first as each case is individual. You may get more info from the Insolvency Service who are online somewhere.

As far as I was led to understand I could not take action against the Director until the Ltd Co was in liquidation.

Hope this helps - but seek professional advice first

[ladymuck]

Where can I find out just how much protection a Ltd Co Director/Owner has?

Still trying to get paid from my ex-friend and I want to sue the ass off her but don't want to go through all that hassle if I'm not going to get anywhere. Tried www.recoveryourdebts.com as suggested by one of you chaps but they won't take on the full recovery because her Ltd Co fell way short of their solvency checks (no surprise there) - hence why I want to sue her rather than the company. My argument is that she knew the company had no money but still strung me along saying she was organising a business start-up loan in order to get me to continue working for her.

Any advice, pointers, blah, blah, all gratefully received.