The other day I helped a fellow migrant. Hardly startling you will agree, but the context was in a Court liquidation where I was the liquidator, and the fellow migrant was the director of the company that was liquidated. Furthermore, we were from completely different cultures and backgrounds. The decided advantage that I had was that English is my first language, whilst it was a distant second language for him.
It transpired, when we met shortly after the commencement of the liquidation, that he was unaware of the ramifications of the both the Statutory Demand and the Liquidation application that had been served on his company. The only reason that he had refused to pay the debt, which leads to the above, was that he in turn had not been paid by the head contractor for work he had done on the contract (the head contractor had gone into liquidation). The money owed by him was for work he had commissioned on the head contract as part of his subcontracting agreement. By his reasoning, as he had not been paid, he was not able to pay the debt for that work.
This rather simple logic led to the liquidation of his company. At our meeting, it transpired that not only had he not sought any professional advice when served with the Court proceedings, but that his company could well be solvent. I referred him to a lawyer to discuss a section 250 Companies Act application to potentially have the company discharged from liquidation which occurred two weeks after the liquidation application.
It was an expensive lesson for that director as he had to pay the Court costs of the applicant creditor (and their claim), his own legal costs and the costs of liquidation in that two-week period. It is an important reminder to those who are served with a Statutory Demand and, indeed, a liquidation application to immediately seek professional advice.
