The company was facing severe financial problems and therefore a group of directors invited Quantuma and Verisona to attend an initial meeting in Woking to assist in identifying a way forward as an alternative to what was being proposed by the majority shareholder. Verisona Law later handled the appointment of the administrators by a debenture holder. Thereafter the firm was appointed by the administrators to represent them and to act on the sale of the club to a newly formed consortium.
The firm worked very long days over the ensuing 3 months to achieve a successful sale of the club to a consortium of supporters.
The unusual timing of the failure resulted in the club seeking to join the Football Conference (“FC”) having already entered into administration. This required the firm to be involved in delicate negotiations with creditors, particularly football creditors because of the strict FC rules relating to payment of their debts. This culminated in them having to attend with the administrators at an urgent meeting of the FC board in Wales in order to present the administrators’ detailed proposals. The process also involved lengthy discussions/negotiations with the Professional Footballers’ Association, the local authority and the Football League and detailed knowledge of the two leagues’ respective rules was essential.
Representing the Administrators the Company mounted a successful challenge to a newly created debenture, and was also involved in negotiations with Chelsea Football Club to use Aldershot’s stadium for Chelsea Youth Squad matches.
Individuals in financial difficulty
- Assistance with financial difficulties, personal guarantees, statutory demands, bankruptcy issues and individual voluntary arrangements
- Dealings with the Official Receiver, The Insolvency Service and trustees in bankruptcy (including possession actions in relation to residential property)
- Insolvency-related disputes and litigation.
Businesses in financial difficulty
- Advice on business refinancing and restructuring
- Advice on and management of insolvency procedures
- Negotiations with trade creditors, HMRC (including ‘time to pay’ agreements), landlords, banks, factoring companies, financiers and insolvency practitioners
- Business sales.
- Technical advice, transactional support and litigation services locally and nationally
- Assistance with investigations
- Insolvency-related disputes and litigation (including construction disputes)
- Personal insolvency issues
- Asset and debt recovery
- Asset and business sales
- Property issues
- Employment issues
- Cross-border assistance.
- Advice on issuing statutory demands and bankruptcy petitions
- Maximising recoveries
- Retention of title issues
- Enforcement of personal guarantees
- Representation at creditor meetings.
Buyers of distressed or insolvent businesses
- Advice on purchasing distressed or insolvent businesses
- Risk assessment and due diligence
- Support for valuation and price negotiation
- Related property, leasehold and employment issues.
Dealing with creditors’ demands for personal guarantee payments
The company had substantial liabilities to the bank and its landlord. These liabilities were personally guaranteed, jointly and severally, by both directors.
The bank and landlord both called in the personal guarantees by pursuing our client, rather than the co-director who had little cash or assets.
As a result our client was required to pay the guarantees totalling tens of thousands of pounds.
Claiming a share of the guarantee payments from the co-director
We were instructed to pursue a claim against the co-director for a contribution of half the amount our client had paid.
The co-director instructed solicitors to resist the claim, alleging they had little or no involvement or control in the business and so should not have to contribute.
We built a case based on the detailed consideration of historic company records which demonstrated the extent of each directors’ involvement in the company. We supplied extensive witness statements and secured the disclosure of financial and other company records relevant to the case.
A number of witnesses also gave evidence at trial.
Winning and enforcing the claim
We secured a judgment at trial against their former co-director for half of the sum our client paid under the personal guarantees, together with interest and their legal costs.
Subsequently we took enforcement action to recover payment and, despite the co-director’s limited means, successfully recovered the full sum for our client.
Former Director and Shareholder of Limited Company
The background to the situation was complicated, yet Verisona Law quickly grasped the essentials and prepared clear arguments with a minimum of wasted time and cost.
Throughout a worrying period, their calm approach allowed me to fulfil my group function with a restored confidence, having been distracted prior to Verisona Law’s appointment by the aggressive and unjustified stance of the Secretary of State.
I have no hesitation in recommending Verisona Law to anyone in a similar position.
Individual - Chairman of a group of companies in the construction industry
Exploring how best to secure payment of the Court award
The Defendant was the sole owner of his property and we discovered there was one mortgage registered against it. Mortgage enquiries and a valuation showed there was over £300,000 of equity in the property.
Taking Court action to settle the debt
First we obtained a Final Charging Order. This means that the Judgment debt is registered and secured against the property as an equitable charge.
We then applied to the Court for an Order for Sale whereby the property would be sold and the proceeds of sale, following the discharge of the mortgage and other costs, would be used to settle the client’s claim.
Although the Defendant strenuously opposed the application, the Court granted an Order for Sale and ordered the Defendant to vacate the property. They refused to leave.
Full repayment of the debt
At this point the Bailiff was instructed to take possession of the property and the Defendant was evicted. It was then sold and we recovered full settlement of the debt and payment of legal costs for our client.
The balance of the proceeds of sale was paid to the Defendant.
Orders for Sale are granted at the discretion of the Court and the Court may be unwilling to make an Order for Sale if there are young children, elderly or disabled occupiers living in the property.
A building company