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Alex J.
Alex J., Solicitor
Category: Law
Satisfied Customers: 3671
Experience:  Solicitors 2 years plus PQE
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, are we ok to use a company to trade that was registered

Customer Question

Hi, are we ok to use a company to trade that was registered over a year ago and uses the initials of a company we have recently had to liquidate?
Submitted: 2 years ago.
Category: Law
Expert:  Alex J. replied 2 years ago.
Alex J. :

Hi, Thank you for your question and welcome. My name is ***** ***** I will assist you.

Alex J. :

Were you a director of the company that was liquidated?

JACUSTOMER-2q583btl- :

yes

Alex J. :

Does the old company have a liquidator appointed?

JACUSTOMER-2q583btl- :

yes it does

Alex J. :

Hi, Thank you. It really depends how similar the company names, however you could be in contravention of S.216 of the Insolvency Act 1986 and the prohibition of the reuse of company names. Will you be a director of the New co?

JACUSTOMER-2q583btl- :

I was a director of the liquidated company and am a director of the other company too. If the liquidated co was Mystic Meg Holdings Ltd and the other company is MM Emporium Ltd would this constitute the re-use of company names as you cite?

Alex J. :

Hi, Thank you. ***** seems very different to me. I do not think those names are ***** *****

Alex J. :

For certainty though I would go and get the opinion of a solicitor in writing, because at least then you have the benefit of their indemnity insurance in case the the liquidator pursues. I would also write to the liquidator and ask them to confirm that they will not pursue you personally for using this name.

JACUSTOMER-2q583btl- :

Obviously the initials are the same - I have used the actual names, but the principle is the same. So, you do not believe that this would be an issue?

Alex J. :

Hi, Thank you. The legilsation that covers trading styles that are the same or similar

Alex J. :

The two styles you described seem very different to me.

Alex J. :

The only way to be sure is to obtain some comfort from the liquidator. Have you started trading new co?

JACUSTOMER-2q583btl- :

Have started doing business, but not invoiced anything until I get this tidied up.

Alex J. :

Hi, Thank you. The risk you are running if the names are ***** ***** is personal liability for old cos debts and criminal liability.

Alex J. :

If you want to be certain that there will be no come back you should either;

Alex J. :

(i) Ask the liquidator to confirm that they are happy with the name; or

Alex J. :

(ii) Apply to court for permission to use the name.

Alex J. :

I dont think option to (ii) is conceptually necessary - but I think if you can obtain a written opinion from a solicitor (with indemnity) insurance and then obtain confirmation from the liquidator that they wont pursue you, this should give you the necessary comfort.