We all know of people who hide from rather than face up to their problems. There are classic tales of people who leave bank statements and credit card statements unopened rather than face their debts and business owners are no different.
I once had to advise a business owner whose Company had been struck off for administrative reasons by the registrar of companies because he’d failed to file his accounts and annual returns and had then ignored the warning letters from the registrar. Unfortunately this was prior to the Companies Act 2006 and when the Company had been struck off the contents of its bank accounts had been declared bona vacantia (basically declared ownerless and passed to the Crown). The Shareholding Director had missed all of his possible opportunities to reinstate the Company and by the time he got to me our only option was to apply to court for reinstatement and the sums of money involved in making the application were pretty similar to the sums sitting in the bank account and so it wasn’t worth his while to proceed.
In the case I was involved in, the shareholding director had to admit to me that he probably had received the warning letters but he’d been going through a rough time so hadn’t been opening his post.
On the 11th July 2014 The Companies (Striking off) (Electronic Communications) Order 2014 comes into effect which gives the Registrar of Companies the right to send notices by text and email rather than by post although the Company must have served notice to the effect that it is happy to receive electronic communications. The issue is to ensure you know where those notifications will be sent to and that they can be accessed by all directors if one should drop out of the picture.
Of course, we also had the situation where a client had applied to strike off his Company and only realised 18 months later that he’d been paying off a mortgage on a property which had been declared bona vacantia. We did manage to get his property back but it did cost him.
For further advice on dissolution and reinstatement of companies please call Cathy Cook on 01924 387110