''Re a Company (No 001418 of 1988)''
990
Year 990 ( CMXC) was a common year starting on Wednesday (link will display the full calendar) of the Julian calendar.
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By place
Europe
* Al-Mansur, ''de facto'' ruler of Al-Andalus, conquers the Castle of Montemor-o-Velho (mode ...
BCC 526 is a
UK insolvency law case, on the offence of
fraudulent trading
In company law, fraudulent trading is doing business with intent to defraud creditors.
Law
Where during the course of a winding-up, it appears to the liquidator that fraudulent trading has occurred, the liquidator may apply to the court for an or ...
under s.213 of the
Insolvency Act 1986.
Facts
The company had exceeded its overdraft limit and fallen behind in payments for
PAYE,
National Insurance
National Insurance (NI) is a fundamental component of the welfare state in the United Kingdom. It acts as a form of social security, since payment of NI contributions establishes entitlement to certain state benefits for workers and their famil ...
contributions,
VAT
A value-added tax (VAT), known in some countries as a goods and services tax (GST), is a type of tax that is assessed incrementally. It is levied on the price of a product or service at each stage of production, distribution, or sale to the en ...
and debts to creditors (totalling around £212,618). Nevertheless Mr Barford, the company's director and majority shareholder, paid himself an increasingly high salary in the very years that debts were mounting to creditors.
Judgment
Judge Bromley Q.C. held that Mr Barford was guilty of
fraudulent trading
In company law, fraudulent trading is doing business with intent to defraud creditors.
Law
Where during the course of a winding-up, it appears to the liquidator that fraudulent trading has occurred, the liquidator may apply to the court for an or ...
. He ordered £156,420 be contributed for the debts and liabilities, containing a compensatory element for the debts that were part of the fraudulent trading and a punitive element of £25,000 (following ''
R v. Grantham''
984QB 675). He held there was "real moral blame" in continuing the company's trading when there was no reason to think that the company could pay its debts as they fell due.
See also
*''
R v. Grantham''
984QB 675
*''
Re Augustus Barnett & Son Ltd
''Re Augustus Barnett & Son Ltd'' 986BCLC 170 is a UK insolvency law case on the standard of fault required to show that directors have been guilty of fraudulent trading.
Facts
Augustus Barnett & Sons Ltd (Barnett) was a subsidiary of Rumasa SA ...
''
986BCLC 170
*''
Re Sarflax Ltd
''Re Sarflax Ltd'' 979Ch 592; 9791 All E.R. 529 is a UK insolvency law case concerning voidable preferences and fraudulent trading, now in the Insolvency Act 1986. It concerns the definition of "intention to defraud", which is found in a number of ...
''
979Ch 592
Notes
{{reflist
United Kingdom insolvency case law
1990 in United Kingdom case law