Lovetts Client Receives Payments From Director Of An Insolvent Company

The Challenge

Our client, a lighting specialist had paid a company monies to hold stock on its behalf. The defendant, a Director of the Company, had signed a declaration confirming that the company was holding the stock paid for. The company then went into liquidation and some of the stock appeared to be missing. The client could not retrieve the £16,000 worth of stock paid for nor did it have any prospect of recovering this sum from the company that was now insolvent.

The Solution

Lovetts were instructed to take over the case and investigated the full background to the situation with the insolvency practitioner dealing with the liquidation of the company and the suppliers the defendant was supposed to have ordered the goods from.

 It transpired that some of the stock had never been in the possession of the Company because it had not ordered the stock or paid for the stock from other suppliers. The defendant had therefore made a fraudulent statement. Lovetts advice was to hold the defendant personally liable for the debt with a claim for fraudulent trading despite being a director of the limited company.

The Benefit

After the defendant was presented with evidence by Lovetts, she agreed to pay our client £16,000 by way of instalments.

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3 March 2014