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Max Lowry
Max Lowry, Advocate
Category: Law
Satisfied Customers: 1457
Experience:  LLB, 10 years post qualification experience
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I am trying to find out WHO an official receiver has the legal

Customer Question

I am trying to find out WHO an official receiver has the legal right to contact after bankruptcy. I was made bankrupt as a sole trader. The business was taken over by a new MD & traded as Ltd Co. The OR office has contacted the Ltd Co clients with regards ***** ***** bankruptcy. This of course will now impact their business (it's a small industry & people talk). The gossip will be that the company is in trouble. The MD is furious & does not see how the OR can involve his clients when it is my bankruptcy. Cant find anyone that can tell me legally if they can do this.
Submitted: 3 years ago.
Category: Law
Expert:  Max Lowry replied 3 years ago.
Hi, welcome to the site. My name is ***** ***** I will help you with your question. In short, the answer to your question is yes, the OR is entitled to contact anybody he thinks maybe one of your creditors. As you were a sole trader at the time of your bankruptcy any of the businesses debts would have been your debts and the OR has a legal duty to establish who you owe money to and indeed whether any money still remains owing to you. If the business was a limited company when you were made bankrupt the OR would have no need to write to the company's clients as any debts would lie with the company. Likewise, any money owed would belong to the company.
Further, upon being made bankrupt, your bankruptcy is advertised in The London Gazette and shown on the Insolvency Register which can be accessed online unless you applied for a court order when you were made bankrupt to stop this happening.
Please let me know if I can clarify anything for you.
Customer: replied 3 years ago.
What actually happened is the client paid (in error) into my old bank account which should have been closed down. This was an error as the OR did not inform the bank I was BR.
The Ltd co traded with one of my old clients. They had not updated their records and paid into the wrong account. The Ltd co are simply needing the bank to return the funds to the sender, so they can organise getting it repaid into the correct account.
The OR has contacted the Ltd co client. About the ltd co invoice. It's not anything to do with me and was a job undertaken after I became bankrupt and was no longer employed or paid by the company.
Expert:  Max Lowry replied 3 years ago.
I understand. Thanks for clarifying.
The ltd company should put pressure on the OR to release the money which rightly belongs to it. It should provide evidence to the OR in the form of a purchase order or something showing the goods/services provided were by the company and possibly a delivery note (if goods) delivering to client.
No doubt the client has already informed the OR that it did business with the ltd company and not you personally.
It could be that the OR just needs a push to get the cash released. The ltd company can threaten a formal complaint against the OR once it has provided all information to show the money paid by the client rightfully belongs to it.
Customer: replied 3 years ago.

I think the problem is that the Ltd Company are furious that the OR has contacted their clients. It is a small industry & people talk. Already the Ltd co are seeing their work tailing off - as people are now associating the Ltd co with a bankruptcy order. What I am trying to clarify is this - is the OR legally entitled to contact a client of the LTD Co - and tell them MY business? Surely my bankruptcy details are confidential now (I was discharged 6mths ago)? Why does the Ltd Co clients now know all my history ? This will also affect my future employment in the same industry...

Expert:  Max Lowry replied 3 years ago.
I understand your concern. The difficulty is that the OR will continue investigating your financial affairs (if merited) even after discharge. After discharge you still owe duties to the OR as a consequence of bankruptcy. The OR is entitled to make enquiries of any of your creditors or debtors. If the business you were running was limited then there would be no reason the OR would get involve. However, because the business was effectively your own business he has a duty to get involved.
I understand what you are saying about the company not being happy about the OR contacting the clients but this can't be helped. The company could as a damage limitation exercise tell the client who have been contacted that the bankruptcy effects an individual, an individual who is no longer with the business; and that the bankruptcy order is not the same as a winding up petition, which does effect a company.
This is not your fault. The OR is doing his job and would need to tell the people you dealt with that you were bankrupt and they are investigating various payments.