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Remus2004
Remus2004, Barrister
Category: Property Law
Satisfied Customers: 2447
Experience:  Over 5 years in practice.
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I am a 33.33% shareholder in a number of residential development

Customer Question

I am a 33.33% shareholder in a number of residential development sites, the company that holds the remaining 66.67% of the shares are under pressure from their bank who funded the purchase of the sites and are expecting the company that hold the shares to be placed into administration with the likely outcome that the sites will be sold to repay the bank even though this will likely leave a surplus. I have invested expertise and a great deal of time into these sites and now look like ending up with nothing. Do I have any legal recourse?
Submitted: 3 years ago.
Category: Property Law
Expert:  Alex J. replied 3 years ago.
Hi,

Thank you for your question and welcome.

My name is AJ and I will assist.

Who actually owns the properties?

Kind regards

AJ
Customer: replied 3 years ago.

The bank are the funders and hold all the charges against title.

Expert:  Alex J. replied 3 years ago.
Hi

Thank you.

Are the properties owned by a limited company of which you are a 33.3% shareholder and another company is 66.6% shareholder.

If so which company did the bank lend money to?

Kind regards

AJ
Customer: replied 3 years ago.

The 66% shareholding was in a company that the bank had charges on and has put into administrative receivership, that company was responsible for the funding. My 33% is in my personal name.

Expert:  Alex J. replied 3 years ago.
Hi,

Thank you.

SO which entity is listed as the legal owner of the property?

Kind regards

AJ
Customer: replied 3 years ago.

A separate limited company. The directors of that company hold all their shares in a management company which the bank have put into administration.


 


So land was owned (title) by company A which had borrowed 100% funding from the bank. Company A is now in administrative receivership.


 


Company B which is the same directors as company A held 66.67% in company A. Company B has been put into receivership by the bank.


 


I as an individual held 33.33% of company A but am not Director or Secretary.

Expert:  Alex J. replied 3 years ago.
Hi,

Thank you.

Administrative Receivership really only applies to charges created before 2003. Is the company definitely in administrative receivership or is it in administration or have the bank appointed a Law of Property Receiver?

Is there enough equity in the property to pay off the bank if it was sold?

Kind regards

AJ