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Alex J.
Alex J., Solicitor
Category: Law
Satisfied Customers: 3840
Experience:  Solicitors 2 years plus PQE
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Good Morning, My name is XXXXX XXXXX I have a situation

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Good Morning, My name is XXXXX XXXXX I have a situation i would like to clarify. I will try to explain as best i can.
I have to receive a payment from a company. The person in charge to do that payment on behalf of the company is an authorizer person. She is not the Director either the owner or shareholder of the company. I have advice that my payment will be delay because that authorizer person is being subject to insolvency process as Director in other company. That company that is being subject to insolvency process is not shareholder either of the company that has to make the payment to me. I asked them that the directors of the company has to make the payment, they have to do it. I can not see the relation between both in oder to stop the payment.
They said, the insolvency process is for a debt with a bank. That authorizer person additional has a personal guarantee and the receiver will see everything.
They said they do not have any court order to stop payments but they have been adviced from there solicitor do not do anything!!!!

The company in insolvency process belong to a Holding Group in which this authorizer person is director and owner. So they said the receivers will check everything as there is her personal guarantee involve in the debt with the bank, debt that origin the insolvency process.

I have told them that i do not not understand how their solicitor can ask them such thing.

Fisrt, the payment i have to receive is not related at all with any transaction or anything with the company that is insolvency process.
Second, The authorizer person is not a Director or shareholder of the company has to give me the payment.
Third: The company that have to give the payment is not in insolvency. Either belong to the company in insolvency. Neither belong to the holding group owner of the insolvency company.

The only link here is she is a authorizer person? and for that the receivers will check everything no matter she is not the owner or director . i do not understand.

Could you give me some lights?

Thank you for your question and welcome.

My name is XXXXX XXXXX I will assist you.

To clarify you are owed money by Company A. A director of Company A is also a Director of Company B. Company B is insolvent. The solicitors of Company A have advised it not to pay any money to any creditors until the situation with Company B is resolved?

How much are you owed and what does it relate to?

Kind regards

Customer: replied 4 years ago.

Hi, The director in Company A is not the Director in company B.

Company B is being subject to insolvency process.


There is a holding company. That holding company is owner of company B, C, D, E, F. The director of all of them is the same person. Additional she is the owner of the holding group. Company B (belong to holding company) is in solvency


Company A is not part of holding company. The director in company B ( in insolvency) is authorizer officer in company A. But she is not Director either owner of company A.


She and his business partner told me that their solicitors told them stop everything. The director of company A is the son of her bussiness partner. He is the owner too. But that payment is not related with the company B at all.





Thank you.

The reason why the solicitor has done this is because they are concerned that this may be a preference under S.239 of the Insolvency Act 1986. If they made the payment and it was deemed a preference then it could be challenged and the money claimed back from you.

As you have rightly pointed out though Company A (your debtor) has nothing to do with Company B. They are distinct legal entities and therefore Company A should not escape payment.

What I suggest is the following:
1. Write to them and make a formal demand for payment.
2. Say if they do not pay you in 7 days you reserve the right to start a county court claim. You can start a claim here

If they wont pay voluntarily that is their prerogative but you can forrce them to do so.

I would note as an alternative to court action if the money owed is un disputed you could serve the company with a statutory demand. The SD will expire after 21 days at which point you be able to petition for Company A's winding up. This would obviously put massive pressure on them to repay with the expense of court action but only works if the debt is not disputed.‎

I look forward to hearing from you.

Kind regards

Customer: replied 4 years ago.

i forgot

the director of company A ( the son of her business partner ) is secretary in company B (insolvency company) and secretary in the holding company owner of company b. i checked in company house.

but the director in company A, is not shareholder in company B either holding company


Thank you.

It makes little difference as the secretary is only an administrative role.

The obligation to pay you is still on Company A, which from what you have described is financially distinct from Company B. Therefore this should not effect Company A's obligations to its creditors.

Kind regards

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