In our experience companies can fail for a variety of reasons including inadequate cashflow, poor economic conditions and disputes with customers.
When taking on a liquidation, we step into the shoes of the company. This typically involves taking control of and selling the assets of the company. On occasion, this can also include reviewing, and at times continuing with pre-liquidation litigation that the company was involved in.
Waterstone has its own in-house legal team, as a result, we have a substantial amount of experience when it comes to dealing with litigation and dispute resolution.
When dealing with a company that’s involved in pre-liquidation litigation, we have the flexibility and understanding to continue to work with the company’s solicitors should we decide to continue with the litigation.
No.1 Quality Food Wholesalers Limited (No.1) operated a food wholesaling business. No.1 entered into a large contract with a new customer of the company. In order to service this contract, No.1 expanded its operation, which included the leasing of new equipment.
This contract ultimately led to a legal dispute, and No.1 filed legal proceedings against the customer.
The ligation had several elements to the claim, including counter-claims filed by the customer.
As the litigation progressed, No.1 ceased trading and eventually became insolvent. After assessing the timeframes for litigation, the shareholders of No.1 decided to place the company into liquidation.
Upon appointment, we immediately took steps to liaise with solicitors acting for No.1 prior to the company’s liquidation, which involved assessing and reviewing the quality of the claim. Working with No.1’s solicitors, the liquidators decided to proceed with the claim.
The liquidators continued to engage with No.1’s solicitors, by filing amended pleadings, while also pursuing the possibility of a settlement.
We were ultimately successful in our efforts by reaching a settlement with the customer. This resulted in a payment to the liquidation, as well as timely resolution of the litigation.