# Company liquidated by revenue - can director start again??



## emeralds (12 Oct 2011)

This is the scenario:
Company X - with director Mr A and Mr B contracted to build a house. Monies paid, job not completed. Clients then discover that Company A has done this to other clients, trail of unpaid contractors and suppliers etc...
Company X is liquidated by Revenue Commissioners. In the meantime, Mr A and Mr B hook up with Mr C and start another company - Company Y - same story ensues... unhappy clients, unpaid contractors and suppliers..
Company Y is put into liquidation by the Revenue - High Court case. Some idle late night googling uncovers the surprising (not!) fact that Mr C has now started up another company with another party...
Who allows this?? Would the Director of Corporate Enforcement be the body charged with seeing that this does not happen?


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## T McGibney (13 Oct 2011)

ODCE concern themselves only with cases where there is evidence of breaches of company law. Many serial business failure cases involve some breach of company law, but not all.  When this sort of query is raised, ODCE say that they are not a debt collection service.


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## capnhand (13 Oct 2011)

Hi

Presumably the liquidator when he makes his report to the ODCE can recommend disqualification of the director if they have not run the company in accordance with Company Law and their actions led to the company failing.

However...you get a nice friendly liquidator to do your liquidation...yada yada yada....

Regards

capnhand


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## kennyb3 (13 Oct 2011)

Worth a read

http://www.independent.ie/business/...panies-linked-to-failed-ventures-2901538.html


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## emeralds (13 Oct 2011)

Thanks kennyb3 - 
Very interesting reading...


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## emeralds (7 Nov 2011)

Update..
Mr A (who was subject to a court order under Section 150(1) of the Companies Act 1990 earlier this year) has registered a new company..All that seems to have happened so far is that he has registered it and he is listed as the owner..Am I right in thinking that he can be the owner without being a director?


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## contemporary (7 Nov 2011)

IIRC you can be restricted as a director but you cannot be restricted from being a shareholder


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## onq (7 Nov 2011)

emeralds said:


> This is the scenario:
> Company X - with director Mr A and Mr B contracted to build a house. Monies paid, job not completed. Clients then discover that Company A has done this to other clients, trail of unpaid contractors and suppliers etc...
> Company X is liquidated by Revenue Commissioners. In the meantime, Mr A and Mr B hook up with Mr C and start another company - Company Y - same story ensues... unhappy clients, unpaid contractors and suppliers..
> Company Y is put into liquidation by the Revenue - High Court case. Some idle late night googling uncovers the surprising (not!) fact that Mr C has now started up another company with another party...
> Who allows this?? Would the Director of Corporate Enforcement be the body charged with seeing that this does not happen?



I thought this was precisely the kind of sequential fraud that the companies act was supposed to prevent.

Why not give the ODCE a ring and let us know how you get on?


ONQ.


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## emeralds (7 Nov 2011)

I did just that late this afternoon. I have to fill in an online complaint form and email it to them and they will look into it. By my calculations, Mr A has now started 4 companies in the last 5 years - 3 of which have been liquidated by order of the High Court...


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## onq (7 Nov 2011)

Well done for blowing the whistle on him.

The building industry used to be riddled with the practice of not paying VAT, then winding up the company and starting again.

The game yer man is playning seems to be a much broader based strategy, with a lot of people getting hurt by his non-payment of debts.


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## T McGibney (8 Nov 2011)

emeralds said:


> I did just that late this afternoon. I have to fill in an online complaint form and email it to them and they will look into it. By my calculations, Mr A has now started 4 companies in the last 5 years - 3 of which have been liquidated by order of the High Court...



Unfortunately unless you cite a specific company law offence, of which you believe this person and/or their company are guilty, and state your grounds for this belief, the CRO will merely 'look into it' and then throw your complaint in the bin. Been there...


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## onq (8 Nov 2011)

T McGibney,

Surely this is why the ODCE was set up in the first place - to ensure that vehicles like companies were not being abused by fraudsters, thieves and criminals?


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## T McGibney (8 Nov 2011)

I put that point to one of their officials many moons ago.  Nothing has changed in the meantime, except that the banking crisis has exponentially increased their workload and they are probably even less inclined to be proactive in other areas than they previously were.


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## onq (8 Nov 2011)

This sounds like a question to be put before the current government and particular Phil Hogan who's currently blowing hot and cold about protection the public in the building industry 

(writes another entry in the lengthening list...)


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## Gervan (8 Nov 2011)

Two years ago I reported a business to ODCE for operating purportedly as a Limited Company when it had been struck off years before for not making returns. I had a polite acknowledgement and that was it. The business is still operating.


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## Purple (8 Nov 2011)

Yet another example of incompetent regulators. 
Let’s give them more powers so they can not enforce those as well! 
That way compliant businesses will have more costs and the gangsters will carry on as is.


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## emeralds (8 Nov 2011)

Gangster is a mild term for what I consider this person to be...


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## mandelbrot (8 Nov 2011)

Purple said:


> Yet another example of incompetent regulators.
> Let’s give them more powers so they can not enforce those as well!
> That way compliant businesses will have more costs and the gangsters will carry on as is.



Yet another example of how our antiquated legal system prevents efficient regulation more like.

Everything to do with ODCE actions has to happen at High Court / Commercial Court level AFAIK, which is madness IMHO. Powers are all well and good, but if they can only be enforced through  the courts then your Regulator is already fighting a losing battle.

I actually sympathise with the ODCE staff, they're stuck between the rock of widespread non-compliance, and the hard place of bureaucracy... 
The sheer number of man hours (and cost) required to go through all the legal red  tape to take an action, against even the most straightforward of  offenders, would probably make your mind boggle.


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## Purple (8 Nov 2011)

mandelbrot said:


> Yet another example of how our antiquated legal system prevents efficient regulation more like.
> 
> Everything to do with ODCE actions has to happen at High Court / Commercial Court level AFAIK, which is madness IMHO. Powers are all well and good, but if they can only be enforced through  the courts then your Regulator is already fighting a losing battle.
> 
> ...



Fair points well made.


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## onq (8 Nov 2011)

All the criminal prosecutions must happen through the courts and the lowest level is district court level, after which they may be appealed to a higher court.

Regulatory matters usually start there as well, so any restrictions in a person's capacity to act, or their liberty will be run through a court.

However, and its a big "however", in planning matters the Planning and Development Act 2000 introduced Section 160, which allows members of the public to initiate legal action against people who are in breach of planning law.

This doesn't place the law into the hands of the public in a literal sense, but it allows members of the public to initiate actions that can result in fines or imprisonment or both.

IOW they don't have to wait for local authorities, who may be strapped for cash or manpower, to take legal action.

More powers like this for the public in company law and the laws governing the financial services sector would be a step towards genuine democracy IMO.


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## mandelbrot (9 Nov 2011)

onq said:


> All the criminal prosecutions must happen through the courts and the lowest level is district court level, after which they may be appealed to a higher court.
> 
> Regulatory matters usually start there as well, so any restrictions in a person's capacity to act, or their liberty will be run through a court.
> 
> ...



I'm not sure where to start (again). As I said above, court actions by ODCE start at High Court level, not district court, and maybe you missed my inference that this in itself is part of the problem.

As regards company law matters, there are actually plenty of things individual membes of the public can do. Creditors of a company can apply to have it wound up, and appoint a liquidator, whose report (to the High court) may result in the restriction or disqualification of the director. There are lots of sections in the companies acts that pertain to civil offences and civil remedies; they're just so rarely invoked... and again IMO the fact that the cost of (high court) action is prohibitive, is a factor, especially since the offending company can be depended on not to have the resources to meet any liabilities after months/years of legal proceedings.

Beyond that, I think people need to be careful who they're doing business with. If they don't do their homework they're always going to be a target for gangsters like the OP described.


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## emeralds (9 Nov 2011)

I agree with the last post re doing the homework before hiring someone. At least in the case of Mr A in my original post, some fairly basic googling will highlight his multiple liquidations and also the restriction registered against him so his chances of suckering somone else are fairly limited compared to even 2 years ago....


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