I am a bit confused as my question was assigned to the Barrister Jo C.
Could you clarify why the Expert has been changed?
As the share split is 50/50 and there is no Special Resolution in place does it mean that for the Limited Company with assets of over £25,000 (some in cash and some in Director Loan) the Company Struck Off by Company House is an option as company became dormant and did not submit any returns for some time? Is it a Director's responsibility to return a Director's loan back to Company's Bank Account
Company has no debt and has no outside creditors. Shareholders - ex wife and husband. During divorce wife unilaterally withdrawn money from the company joint account into her own (also a company account to which husband has no access) and decided not to distribute any assets. Court ordered her to pay 50 percent of the assets (Director Loan plus cash) and she finally made a payment. Court's decision was made purely based on overall distribution of the company assets (Director Loan plus cash in bank which is in line with the Heads of Agreement signed between shareholders in the process of the financial resolution). However, she is now appealing to court's decision saying that if it was a Liquidation process she would have get more money distributed to her as she believes that Director Loan (she accountable for) would have seen as a joint responsibility of both shareholders and from her point of view Liquidator would have dealt with the Loan on paper (basically split the responsibility for it 50/50 between shareholders regardless who is accountable for it) and any cash would have split 50/50 as well. Basically Director is saying there should have been a Liquidation process in place result of which should have been 75 per cent of the company assets to her and 25 to other shareholder (as the value of Director Loan is about the same value of the cash in bank, i.e. 50 percent Director Loan and 50 percent cash).
Yes, it is appeal to decision made by a family court as part of divorce process.
Yes, she made a payment, so I have got my 50 percent share and everything is fine from this point of view.
But she is trying to overturn it and made a statement in Appeal court during directions hearing that from her point it should have been a voluntary liquidation process and as a result of liquidation process she would have get more money as she is saying that part of Director's Loan is husband's responcibility even though there is no evidence that the husband (who is a second share holder) took that loan and on contrary in the company accounts for the previous years which were signed by both parties (Director (her) and Secretary (Husband) it is her name against a Director Loan.
For Liquidation itself there were no Special Resolution Meeting in place (even though a potential liquidator tried to arrange one on her behalf) as neither of shareholders attended it and accordingly nothing was signed; and also form my point of view the Director did not fulfil its responsibilities, i.e. Financial Accounts for that Year were compiled a half a year later than it set by the procedure due to the fact that a director was not able to provide necessary accounting information on her side and even when they were compiled by the company's accountant Director did not sign those financial accounts. However, the company tax was payed on the basis of those accounts.
To me the Director not only withheld some accounting information, did not sign accounts and did not distribute any money between shareholders but now also is trying to direct the Court in wrong direction saying that the liquidation was a way forward and she would have get bigger slice of assets as a result of Liquidation of the company. All this regardless of the actual facts and her short comings in regard to fulfilling director's duties (provision of information to accountant for compilation of the accounts, signing accounts, distribution of the assets).
Thank you, ***** ***** repaid the loan the money in the bank account would have roughly double. But my question really is if the liquidation process would have agreed by both parties how the loan is usually distributed by the liquidator. I would think that the loan is not to be just written-of on a 50/50 basis (even though this type of scenario is also possible) but distributed between to shareholders depending on who taken that loan, how it was formalised and how it was used/spent, - is not it? Or I am mistaken. Again, even though the company loan (in this case it is a Director's Loan) can be dealt by the Liquidator on paper the actual distribution of the overall assets of the company (where the director loan is also an asset) shall depend on several factors I believe.
Could you please clarify? Thanks
Thank you, ***** ***** last thing I would like to clarify.
In your previous answer you said the following:
"That which is ordered in a financial settlement in a family court will take precedent over any potential company proceedings."
This your statement what it is based on? Why the family court should take precedent?
Thank you very much for your help,