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Eon claimform - disolved Ltd Co. util Bill

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eon are using LCS ( debt collector) to chase for Limited company debt,

company no longer trading - Dissolved in February 2016

 

eon have changed the name on correspondence from "XXX Limited co" to ( Directors name T/A XXX )

 

i wrote back to LCS stating LTD company is separate legal entity - and that they cannot simply assign the debt to the previous director.

 

I also asked for copy of any agreements, signed documents, copies of any bills etc

as i believe the bills will have xxx ltd ( Not TA)

 

Is this Practice legal - surely there is an illegal re-assignment attempt here - what about VAT ??

they cant retrospectively go back and change names on invoices and reassign the vat ....

 

Now i have a CCBC claim form for the above

I have filed an AOS stating i will defend complete claim.

 

Any help or advice welcome

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But what is the story here regarding this LTD company being dissolved ? A Director of that LTD company can't just close one business down to escape debts and then set up another company doing pretty much the same business, but without the debts. EON are entitled to go after the Directors of that business to recover the debt.

 

How many Directors were listed at time company was dissolved ?

 

Were any stock or equipment transferred from the dissolved company to a new company operated by Directors of the dissolved company ?


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company ceased trading.

no money in bank or assets apart from handtools

single director

lease came to an end

no phoenix company

company had been inactive for several months

company dissolved

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I think you can still be liable as Director for the debts of the dissolved company.

They could therefore gain a CCJ against you as a Director and obviously this would not be great on your records, as anyone searching would see you had a CCJ.

 

It would surprise me if Directors could simply leave debts behind and avoid getting CCJ's.

 

Have asked site whether to move this thread to legal, as you have received a court claim.


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I think you can still be liable as Director for the debts of the dissolved company.

 

...........

 

It would surprise me if Directors could simply leave debts behind and avoid getting CCJ's.

 

The whole point of a limited company is its limited liability.

This primarily protects the shareholders (owners) who are only liable for the value of their share (+/- any unpaid sum on that share).

 

The ltd co is a distinct personality from its directors too.

The directors can be liable if they signed personal guarantees (as these "pierce the corporate veil"), but if not the directors aren't liable personally for the company's debts absent some other cause creating that liability, (such as knowing continuing to trade while insolvent or other breach of their Director's duties).

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Why do Directors of such LTD companies regularly end up with CCJ's for these utility debts ?

 

It would be very very surprising if this was not covered by legislation.

The debt would be against them as Director of the company and not a personal debt as a private individual.


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If you have evidence that the limited company (and not their new entity XXXX t/a XXXX) was liable for the debt, then your defence will be fairly straightforward.

 

What documentation do you have - maybe bills addressed to the LTD Co, a contract, copy of the lease, letters from EON or the DCA chasing the LTD Co?

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If the bill was genuinely a company debt, then I don't see how they could pursue you personally.

 

Sometimes, people sign terms and conditions which include a personal guarantee. It is easy to do that if you sign without reading the small print. If there is a personal guarantee you will be liable. However it would be for the claimant to prove this by providing a copy of the signed guarantee.

 

If you believe that this is a company debt, that is a very simple defence - and it is really for them to try and prove otherwise by providing copies of the relevant documents.

 

It would surprise me if Directors could simply leave debts behind and avoid getting CCJ's.

This is exactly what they can do UB. The general rule is that directors are not personally liable for the debts of the company they run.

 

There are exceptions for example if the company was used to commit fraud, or if the director took assets out of the company knowing it was insolvent. For example if the company owns £1000 of property that £1000 has to be used to pay creditors - the director will be liable if he takes that £1000 or himself or moves it into a phoenix company.


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I think you can still be liable as Director for the debts of the dissolved company.

They could therefore gain a CCJ against you as a Director and obviously this would not be great on your records, as anyone searching would see you had a CCJ.

 

It would surprise me if Directors could simply leave debts behind and avoid getting CCJ's.

 

Have asked site whether to move this thread to legal, as you have received a court claim.

 

The limited company is a separate legal entity in its own right.

I disagree with the director being liable - unless they had PG which they did not.

I don't think the debt is transferable by simply changing the name format - this must illegal or wrong.

They have previously invoiced in the ltd company name - I don't have any copy invoices.

I left paperwork behind when I gave keys to unit back

I am hoping to defend on basis of Ltd co liability not directors

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I will defend on this basis

just wondered if they were committing an offence or fraudulent activity by changing trading title to secure a debt

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If the bill was genuinely a company debt, then I don't see how they could pursue you personally.

 

Sometimes, people sign terms and conditions which include a personal guarantee. It is easy to do that if you sign without reading the small print. If there is a personal guarantee you will be liable. However it would be for the claimant to prove this by providing a copy of the signed guarantee.

 

If you believe that this is a company debt, that is a very simple defence - and it is really for them to try and prove otherwise by providing copies of the relevant documents.

 

 

This is exactly what they can do UB. The general rule is that directors are not personally liable for the debts of the company they run.

 

There are exceptions for example if the company was used to commit fraud, or if the director took assets out of the company knowing it was insolvent. For example if the company owns £1000 of property that £1000 has to be used to pay creditors - the director will be liable if he takes that £1000 or himself or moves it into a phoenix company.

 

Thanks Steampower, I was fairly confident that was the case - just needed to have it confirmed

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If the bill was genuinely a company debt, then I don't see how they could pursue you personally.

 

Sometimes, people sign terms and conditions which include a personal guarantee. It is easy to do that if you sign without reading the small print. If there is a personal guarantee you will be liable. However it would be for the claimant to prove this by providing a copy of the signed guarantee.

 

If you believe that this is a company debt, that is a very simple defence - and it is really for them to try and prove otherwise by providing copies of the relevant documents.

 

 

This is exactly what they can do UB. The general rule is that directors are not personally liable for the debts of the company they run.

 

There are exceptions for example if the company was used to commit fraud, or if the director took assets out of the company knowing it was insolvent. For example if the company owns £1000 of property that £1000 has to be used to pay creditors - the director will be liable if he takes that £1000 or himself or moves it into a phoenix company.

 

Thanks Steampowered ,Supervillan FKOfilee , Bazzas, and others.

 

I was fairly confident that was the case - just needed to have it confirmed

just wondered if they were committing an offence or fraudulent activity by changing trading title to secure a debt

 

I need to come up with a set of wording for the claim form defence,

I also note the claim form is signed by Debt collectors company name and not an individual - I thought a statement of truth needed to be signed by an individual

the claim form guidance notes state "Statement of truth, This must be signed by you, your solicitor or your litigation friend.

Where the claimant is a registered company or a corporation the claim must be signed by either the director or other officer of the company

or (in the case of a corporation) the mayor, chairman, president or town clerk.

 

does this invalidate the form.

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just wondered if they were committing an offence or fraudulent activity by changing trading title to secure a debt

I don't think it matters. They say you owe the debt. You say the company owes the debt. Unless the case settles the court will decide. No need to overcomplicate it.

 

I need to come up with a set of wording for the claim form defence,

Very simple I would have thought. Simply saying that liability for the debt is denied, on the basis that the debt was incurred by company X Ltd as an independent legal entity. You probably need to give a bit of background - such as explaining that the company was the party to the lease, which contracted with the company and to which bills were addressed. Do check your paperwork to see if those statements are accurate.

 

does this invalidate the form.

No. Personally I wouldn't bother running the point, it is a distraction. Even if it did invalidate the form they would just redo it.


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Ok,

that's what I will do.

Thanks for your prompt help

TW3

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common with utility companies, BT does it when your relatives die, they change the account name to yours when you tell them of the death and are reluctant to admit that they dont have any right to do so.

Now, with many energy suppliers the devil is in the detail as they like to get the directors to be liable for the company debts so it is possible your contract makes you liable but without that correct contract you are not liable for a Ltd co debt unless it can be shown you behaved in a reckless manner and companies house are usually the arbiter of that.

I would be challenging their claim on the basis that they are chasing the wrong entity and so you owe nothing. If you have old bills you can show that xxx Ltd was previously billed (up to the point of when the co dissolved) and thus this new effort is unjustified

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