Case History – BIS v SAW & JED

Background

SAW and JED were formerly directors of a substantial computer maintenance company PCSL which went into administration.

During the course of the administration the insolvency practitioners reported various matters of concern to the Secretary of State for Business Innovation & Skills (BIS) who subsequently commenced disqualification proceedings against SAW & JED pursuant to the Company Directors Disqualification Act 1986.

The allegations included running PCS for the benefit of the directors to the detriment of its creditors. Inflating the value of stock items to create the impression the company was solvent when it was insolvent. Extending loans to one company with common directors when there was no real prospect of the loan being repaid. Non cooperation with the office holders in administration.

BIS issued proceedings seeking a Disqualification Order for a period of 9 years.

Actions

ICL Commercial Law was instructed to assist SAW & JED in defending the proceedings due to SAW & JED not having confidence in the solicitors who had been assisting at the enquiry stage.

Counsel was instructed to represent SAW and JED in court.

ICL Commercial Law assisted SAW and JED by drafting their affidavits as evidence in answer to the evidence submitted by BIS as part of the proceedings.

ICL Commercial Law succeeded in securing an order to allow expert evidence to be adduced.

ICL Commercial Law briefed the expert who subsequently compiled a concise report countering many of the allegations made by BIS.

ICL Commercial Law succeeded in applying to adduce further evidence following BIS’s evidence in answer to the expert report.

ICL Commercial Law secured an order to allow SAW & JED to review the files of the insolvency practitioner.

Result

The disqualification period was reduced to 5 years and settled by undertaking.