Issue a winding up petition

To recover a debt then there are a range of remedies available.  Issuing a winding up petition is perhaps the most effective.

You petition the court to issue a winding up order against the company.  A hearing date will be set and the debtor informed.  This is a last resort and you should always look at other ways of collecting the debt first.

 

Most importantly, the debt must be absolutely proven.  Any arguments about the debt will mean the court is not satisfied it has been proven and will throw the case out.  This can be very expensive as you will be charged for costs.

 

Have you tried all other means to collect the debt?  You need to be seen to be giving the debtor lots of opportunities to pay.  A winding up petition is saying “can’t pay” rather than “won’t pay”  So you will need to have issued lots of warning letters etc.

If the court thinks that you are just trying to kill the company as you are a competitor then it will give the company more opportunity to try and restructure itself.  This is true even if the debt is provable etc.  The court has to look at the position of other creditors as well.

 

Re Dollar Land (Feltham) & Ors [1995] BCC 740 reported that a winding-up order should be rescinded if there was a real prospect that CVA proposals would be approved by the  creditors. So basically let the CVA majority decide.

 

What next?

Look at the cost of collection.  You will need to instruct a solicitor to issue the winding up petition and pay a court filing fee.  All this is likely to add up to nearly £2000 so it best reserved for large debts.  If you have not instructed a solicitor then we can recommend Rashmi Dube from Liquid Recovery she is a solicitor and runs a debt collection and cashflow solutions service called Liquid Recovery.  You can call her on 07958920709 or 0844 811 9463

Here is a recent testimonial for her.

“Liquid Recovery replied very promptly to my query, providing clear instructions. Within less than a week they had recovered the debt and reported back to me. Very happy with this.  Thank you for sending the funds so rapidly, your service is totally recommendable.”

Steve Watt, Chartered Accountant, Folkestone