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Ash
Ash, Solicitor
Category: Law
Satisfied Customers: 10916
Experience:  Solicitor with 5+ years experience
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A deptor is sueing a Ltd company for debts that pre date the

Resolved Question:

A deptor is sueing a Ltd company for debts that pre date the companies incorporation.
Submitted: 2 years ago.
Category: Law
Expert:  Ash replied 2 years ago.
Alex Watts : Hello my name is ***** ***** I will help you with this.
Alex Watts : For now could you please explain your situation a little more?
Customer: My wife started her ltd company in April 13 Lake District Outdoor Ltd on the advice of our accountant. I had a trading as company called Lake District Outdoor. A web hosting company is sueing the Ltd company for debts that belong to the trading as company.
Customer:

Are you still there?

Alex Watts : But won't she be Personally liable if its a debt before the ltd company? What date is the old invoice?
Customer:

Jan 13

Customer:

On another note I don't believe there is a contract in place

Alex Watts : Yes but had she had the work done?
Customer:

the Company have already applied a CCJ & I am in the process of disputing it as the debt doesn't in my view belong to the Ltd Company.

Customer:

The work was not requested but merely discussed & they went ahead without me signing the contract & agreeing to the work which was for my company the sole trader & my wife was not involved.

Alex Watts : But the ccj will end up being against you personally and not the company though if you lose?
Customer:

The CCJ has been filed against the Ltd Company which I believe is wrong, am I right in thinking this?

Alex Watts : Ok, why didn't the company file a defence saying its nothing to do with us?
Customer:

family bereavement

Alex Watts : Ok, when was the judgment?
Customer:

I have filed an N244 to get the judgement set aside & the hearing is next Tuesday but the other parties solicitors are pressuring me to cancel the hearing & I need to know the law is on my side to proceed as I will have to travel a long way & don't want to incur further costs

Alex Watts : Yes I need to know when were proceedings issued and what is the date of judgment?
Customer:

If i gave you the case number ***** you find it? we are having some decorating done & struggling to find the forms.

Customer:

Judgement went through on 31st July & issue date 8th July

Alex Watts :

Sadly I can't do that. If Judgment was entered in July and we are now in September why have you waited so long?

Customer:

Once judgement went through they transfered to high court enforcement and 7nder duress had to pay the debt but felt it was unfair so am looking for advice. Whilst I understand you need all the information surely it is either the judgement is right or wrong

Alex Watts :

Have you paid the Judgment?

Alex Watts :

The test is not just whether they are entitled to enter Judgment but whether you acted promtly.

Customer:

We have paid the Bailiffs otherwise they were going to empty our shop & we would have had to cease trading

Customer:

What do you mean by test

Alex Watts :

Have you paid the Judgment in full?

Customer:

As I said we had to

Alex Watts :

Ok - well there are 2 problems then in relation to this

Alex Watts :

1) You can't set aside a Judgment that has been paid.

Alex Watts :

The test applied to the Court is does the Defendant have a realistic prospect of successfully defending the claim

Alex Watts :

The claim has been paid so there is no defence to the claim

Alex Watts :

Even if they were the test is:

Alex Watts :

2) Have you acted promptyl.

Customer:

I applied for the set aside before I paid but the courts messed up

Alex Watts :

Case law shows that anything over 30 days from date of Judgment is not prompt

Alex Watts :

Therefore if you applied to set aside after 30 days any application is likely to fail

Alex Watts :

But the problem is you have paid the debt.

Alex Watts :

Therefore there is no point setting aside.

Alex Watts :

But in answer to your question would there have been a defence - yes

Alex Watts :

This is because the company can not owe a debt created before it even existed.

Alex Watts :

So if you had not paid the debt, then you could have applied to the Court to set aside and it would have succeeded, setting aside any argument about being prompt.

Alex Watts :

But as it stands the Judge wont set it aside because it has been paid.

Customer:

Even itthough was paid under duress & I have a letter from the court admitting their clerk messed up

Alex Watts :

You may be able to set it aside under PArt 3 of the Civil procedure rules as a mistake but not under the usual set aside rule

Customer:

What do you think the chances are?

Alex Watts :

Its had

Alex Watts :

Its hard to say - its been paid

Alex Watts :

That is the killer

Customer:

We had no choice

Alex Watts :

Of course. I think you may get it set aside on the basis it was wrongly entered but whether you get your money back is a different matter

Alex Watts :

Can I clarify anything for you about this today please?

Customer:

Is it not true that if it is set aside the money must be returned?

Alex Watts :

Not necessarily, you would need an order from the Court

Customer:

So if set aside we can counter sue?

Alex Watts :

Yes you can

Alex Watts :

Can I clarify anything else for you today?

Customer:

Thank You

Alex Watts : Is there anything else I can help with?
Ash and 3 other Law Specialists are ready to help you

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