Owner closing business to avoid paying me

[steampowered]

Yes, you could start a claim against him personally in small claims provided the claim is less than 10k. Whether you have a good chance of succeeding in the event he defends the claim depends on whether you have grounds to claim against him personally, or whether you have grounds to "pierce the veil".

 

I don't know if it would impact on his SIA license. My guess is that it probably would not.

[rogerswendy]

I am very tempted to take a personal action out against him because this person is abusing the privileges afforded by the Ltd company status and I believe I have sufficient evidence to prove it . If I were to take an action out against him personally, and was not successful, would he then be able to make a claim against me for solicitors' fees, do you know? Also, would a judge be likely to grant him his solicitors' fees do you think? I can't believe a judge would think him to be in the right but I wonder if theymay be reluctant to make a controversial decision by making him personally liable, despite his Ltd company status.

[steampowered]

There are normally no legal costs awarded on the small claims track. However, the court does have power to award costs if it thinks one of the parties has behaved unreasonably (which usually means behaving unreasonably in how you conduct the litigation). This power is rarely used.

 

If you are going for a "piercing the veil" claim, your Particulars MUST clearly explain why your case fits within one of the recognised categories of cases in which the court will pierce the veil. It is not enough to simply describe the facts. What I am saying is that this area of law is not straightforward so you will need to spend some time properly researching the law and it is worth getting some help (either by posting a draft of the Particulars on CAG and asking for input, or by seeing a solicitor or perhaps a local law centre or the CAB... though to be honest company law is not the kind of stuff CAB advisers usually deal with).

[rogerswendy]

Hello

You may remember (from my previous postings) that I was concerned that an estate agent/builder I am taking through small claims intends to close his business in order to avoid my claim. This person has not defended my claim and, for this reason, I have asked the court to make a judgement. I am awaiting that judgement now. Meanwhile, the estate agent/builder has closed his shop (or, at least, it appears to be open very infrequently) and seems to be running the business through Twitter. He is also advertising his house through Twitter so it seems he intends to move away. I am very keen to attempt to "pierce the corporate veil" and make a claim against this person before he disappears. My question is, is he likely to be able to disappear to the extent I will not be able to pursue the claim? Also, do I have to wait until the court rules on the earlier case (against his company)? Any advice would be welcome please.

Thank you

Wendy

[steampowered]

In that case you should try to enforce the default judgment ASAP against the business.

 

To pierce the veil against the individual you will need to start a new claim. There is no need to wait until the court rules on the earlier case. In fact, the court will never rule on the earlier case once you have default judgment. Default judgment is the end of the case unless he attempts to make an application to have the default judgment aside.

[rogerswendy]

If this person tries to "disappear" does the court have any means of tracing him? I know it is going to take a while to take this case through the court and I am wondering if it is worth the effort if he plans to "disappear". I will start working on a draft for the piercing the veil claim ASAP and I will post it for comment - annonomised, of course.

Many thanks

Wendy

[rogerswendy]

Hello Forum Members

 

Since the last time I posted about the illegal behavior of the estate agent/builder who used intimidation tactics to extort more than £8k out of me, a number of things have happened:

 

1) this small businessman went "underground" and closed his high street estate agency and began operating his business through Twitter.

2) I was advised by the Court that my undefended claim against this person(for breach of contract) had been granted back in early June but the letter to inform me of that fact had not been sent

3) I heard this small business man had engaged a roofer to re-roof one of his properties and had not paid him - which caused the roofer to retaliate by removing all the tiles from this roof in an attempt to recover some of this debt (I mention this because there does seem to be a pattern here in the way this business man runs his businesses)

3) this small business man has now set up his business in a room in a pub approx 10 miles away from its original location

4) I have not had any contact from this businessman and I have not yet received any payment towards the debt he owes me (the Court awarded me £2,200). For this reason I am assuming he has no intention to pay me any monies.

 

I would now like to submit a claim to the small claims court and attempt to "pierce the corporate veil" and recover this debt from this businessman's personal assets and am attempting to gather information to support my new claim and the purpose of this email is to ask for advice/information about what information I should gather and from whom I might be able to gather this information.

 

So far I have asked the local council (freedom to information request) to provide me with information about any complaints they have received about the 4 companies and the one fish and chip shop this person has run since 1999.

 

I would also like to find out about his assets (i.e.the new transit van he has which is emblazoned with the estate agents log) so that I know whether it is worth asking the county court to send in the bailiffs to recover this debt. I wonder if the DVLA would respond to an FTI request and let me know if it is registered to him or to the company against which I have a CCJ? Can anyone shed light on that?

 

Would Companies House provide me with information about any CCJs the 4 companies and the fish and chip shop this person owns has against them?

 

Would Companies House give me access to the Estate Agency's accounts so that I can see if this business man is claiming tax relief for the transit van? (I suspect he has already transferred this asset to the Fish and Chip Shop, but prove that if that were the case.

 

I have been told that the two person who carried out the bulk of the building work on his behalf were not tradesmen, as he described them, but were long-term unemployed laborers who are in receipt of sickness benefits and who have "hobbled" for him for the last year. I have the name of one of them. Should I try to uncover more information about them?

 

Any advice on how to gather relevant evidence to build myself a good case would be appreciated.

Many thanks

Wendy

[steampowered]

Before you start suing this person as an individual, have you worked out what you would do with a judgment? Do you know where he lives in order to actually start proceedings and have you identified assets to enforce against?

 

Not sure you will get far with FOI requests ... these are generally designed for generic information not specific information about individuals (see http://www.legislation.gov.uk/ukpga/2000/36/section/40). Do report him to trading standards however.

 

Companies House will not hold details of CCJs. Court proceedings (including statements of case - i.e. Particulars of Claim and Defence) are technically public information, but there is no decent central database. You might start by enquiring with the County Court for the relevant area ... though ultimately I'm not sure how much finding out about other people's CCJs will help.

 

Accounts for companies are filed online with Companies House and are publicly accessible on the Companies House Direct website for a pound each. However there are exemptions for small companies, you probably won't find enough info to see whether he is claiming tax relief for the van.

 

Your question about whether to call the men who worked for him as witnesses is a question for later.

[rogerswendy]

Hello Steampowered

]Thanks for responding so quickly. You make some good points here and I will address them one-by-one.

 

First, you asked me if I know where this person lives. Yes I do and I know where his office is based too.

If I gained a judgement against him I would first send in the Bailiffs if he refused to pay.

I would also send the judgement to whichever organisation polices the law/act that requires company directors to adhere to certain standards of behavior (cant remember the name of it here). I believe some of the evidence I have (taped telephone calls and emails) would show he does not care whether he complies with the law or not. Therefore I would like to get this evidence to court and get the judgement on record. Who knows, if enough people complain about him one day he might not be allowed to be the Director of another company! I think that would be a result because this sole trader uses the Ltd Company status to protect him while he is committing illegal acts. I have identified certain assets:

 

His house which is on the market for £280k

His very new van which is emblazoned with the company name. If I could find out whether he has transferred that van to his other business in order to avoid paying me then I believe that is an illegal act??

A Fish and Chip bar he owns or is a partner in

 

2) You suggested I report him to Trading Standards. I have done that and they did investigate my complaint. I know they were considering taking action against him but I believe that, for cost reasons, they decided against that. The Trading Standards Officers and the Police, who were involved when he threatened to break into my property, have both advised him on certain actions and he has treated them with complete contempt. I know he has committed violence against one of his tenants and I know Trading Standards have received at least one other complaint about this person. I am hoping I will find that Trading Standards will be required to disclose more information after the FTI request.

 

3) Thanks for the information about the records held by the local county courts - I will find out what I can from them

 

4) I was hoping to get the accounts because I wanted to establish whether there was a record of his claiming depreciation for the van. That would prove the had the van when he had the judgment made against him.

 

I am particularly keen to hold this man to account because he took the action he did because he knew that the owner of the house, my brother, is a vulnerable person. I was forced to commit to buy the house from my brother because I knew my brother was not capable of managing this situation or capable of standing up to this cowardly individual (who has a reputation for violence against vulnerable women/people). For that reason his fraud has cost me a very great deal of money. I wonder if my "losses" from his actions can be factored into my claim?

[renegadeimp]

If you gained a judgement against him personally and he owned the house, then thats where the bailiffs would need to be sent. it would be better imo to get HCEO's involved. Small cost but they get the job done.

[rogerswendy]

Thanks for this. I have ordered the book because I think it looks as though it might be useful. Could you tell me what HCEOs are?

[ploddertom]

Could you tell me what HCEOs are?

 

High Court Enforcement Officers. If you have a CCJ against someone or a company then you can transfer the debt for enforcement to the High Court. It costs £60 but this is added to the debt, HCEOs give no prior warning of attendance and just turn up at the address(es) you have given. They are more tenacious that the County Court Bailiff and can force entry to commercial premises even on a first visit. If for some reason they cannot enforce the Writ then there may be an abortive fee to pay £60/£80 +VAT. Before taking this action I would recommend speaking to a HCEO Co first as they should be able to explain what happens and answer any queries - particularly with regard to the entity they are going after. Unfortunately we can't tell you who to go with but just remember biggest is not always best although there are a good range of FAQ's at http://thesheriffsoffice.com/faqs

[rogerswendy]

I have looked up the website. Very good information to have, thanks. The cost of this service seems very reasonable actually.

Thanks again

Wendy

[ploddertom]

You appear to have lots of information on the person you are chasing. A lot may depend on what basis he trades under - Sole Trader or Ltd Co or AN Other - the HCEO should be able to guide you and you in turn should be able to provide all the addresses you know he trades/lives at/from + details of vehicles etc. To employ the County Court Bailiff will cost you £100 and they in turn inform the debtor they are going to attend. Has to be worth trying the HCEO and if you don't like what you hear then don't go with them.

[rogerswendy]

Thanks for this. Yes, I will contact HCEO and find out what they think is the best way to manage my situation.

Wendy

[citizenB]

This thread is now in "General Legal Issues"

 

It is purely an administrative move.

[rogerswendy]

I have been awarded a CCJ against a local businessman who has no intention of paying me. I am in the process of calling on the services of the Sherriffs office in an attempt to get the money back via the bailiffs. I would now like to attempt a second action against him to pierce the corporate veil and attempt to get him to repay me additional monies that he owes me that I was not able to claim in the first claim i.e. £600 for a surveyors repotr and the cost of an extremely expensive freezer that he took from the house, from his personal assets. Can I post the particulars of the claim on this site (if I take out all names etc) and ask for comments on how I should improve/develop the particulars before I submit them to the court? If so, is this posting appropriate for the General legal issues site? Many thanks

Wendy

Edited September 28, 2013 by rogerswendy
punctuation error which impacts on "sense" of posting

[rogerswendy]

I have been awarded a CCJ against a local businessman who has no intention of paying me. I believe he has acted dishonestly a number of times with other people and I believe I have evidence of a number of dishonest representations he made during his dealings with me. I am in the process of calling on the services of the Sheriffs office in an attempt to get the money back via the bailiffs. I would now like to attempt a second action against him to pierce the corporate veil and attempt to get him to repay me additional monies that he owes me that I was not able to claim in the first claim i.e. £600 for a surveyors repotr and the cost of an extremely expensive freezer that he took from the house, from his personal assets. Can I post the particulars of the claim on this site (if I take out all names etc) and ask for comments on how I should improve/develop the particulars before I submit them to the court? If so, is this posting appropriate for the General legal issues site? Many thanks

Wendy

[honeybee13]

Hello Wendy.

 

I've merged this new thread with your old one, I think it will help the people trying to advise you.

 

My best, HB

[steampowered]

Piercing the veil is used to pursue a claim which is originally against a company, against the individual personally (in very limited circumstances). It isn't really designed to claim for things which didn't you didn't claim for first time around. It may be better to wait and see what the Bailiffs come up with before spending more in court fees.

 

If your second claim relates to things arising out of the same facts as the first claim, and you simply forgot to put them in, you may now find that the builder has a strong Defence to your second claim - you are supposed to put your whole case first time round. We would need more information, but my initial guess is that a claim for the surveyor's report would be barred (arising out of the same facts as the first time) but a claim for the freezer would not (arising out of different facts - he took the freezer).

 

You can post the POC after removing all personal information, or just describe it, if you wish.

[gpmsc]

If he is registered with Companies House it appears they can prevent him from disolving the company if creditors are owed money, to prevent him evading his liability the company is red flagged by Companies House.

[rogerswendy]

Hello Consumer Action Forum

As you will see from my previous posts I have called in the services of the Sheriffs Office in an attempt to recover money from somebody who has opened and closed several businesses owing creditors money. I heard from the Sheriffs Office today. They went to this persons home (he is running the business from the house but using a room in a local venue as an office when he meets with clients) but he told them the business is closed owing creditors £30K. It seems inconceivable that he would close this lucrative business and, for various reasons, I am convinced that the business is still trading. I have informed the Sheriffs office about what I know but I wondered if this is the sort of thing the Insolvency Service could/would look in to? I would be interested in hearing your advice and opinions. Also, can I proceed with a "Piercing the Corporate Veil" claim now, or should I wait until the Sheriffs Office tell me they have done everything they can do?

Edited November 19, 2013 by rogerswendy

[rogerswendy]

Forgot to mention that the company is still registered with Companies House.

[rogerswendy]

Hello Forum Members

I would like to take an action to "pierce the corporate veil" of a company which is operating in an illegal way. Can anybody tell me whether I can take this action forward through the small claims court or whether this would be a criminal action?

[ims21]

Is this to do with your thread here?

 

http://www.consumeractiongroup.co.uk/forum/showthread.php?391039-Owner-closing-business-to-avoid-paying-me&p=4401982#post4401982