By Gavin Mackintosh-
The boss of a mobility equipment company has been banned by the courts accepting large payments despite knowing the business was insolvent.
Incorporated in October 2013, Churchills Homecare supplied and installed mobility equipment in domestic properties.
However, Churchills Homecare began to incur losses as a result of higher costs in the business and by December 2015. The company had ceased trading before entering into Creditor’s Voluntary Liquidation in the same month.Trading from offices in Macclesfield. Independent liquidators were appointed to wind-up the company before reporting to the Insolvency Service that Churchills Homecare had continued to accept advanced payments from customers after the point it was in trouble.
After further enquiries, investigators found that between 4 and 23 December 2015, the time when Churchills Homecare stopped trading before entering into liquidation, Craig Paterson secured close to £66,000 from 13 new customers even though he ought to have known that the company was insolvent. At the same time, Craig Paterson caused the company to repay a loan worth £125,000 that he had previously made to the company.
The repayment of the loan back to Craig Paterson was part funded by the £66,000 secured from the new customers that had no reasonable likelihood of receiving the goods and services they paid for. On 9 January 2019 in the High Court in Manchester, HHJ Hodge QC made a Disqualification Order against Craig Paterson for a period of 6 years on the grounds that he accepted payments during a time he ought to have known the company was insolvent and caused Churchills Homecare to repay a loan back to him, funded through customers’ advance payments.
Craig Paterson has now been officially banned from directly or indirectly becoming involved, without the permission of the court, in the promotion, formation or management of a company.
And Belinda Rogers previously provided a disqualification undertaking to the Secretary of State for Business, Energy and Industrial Strategy on 11 May 2018 after she did not dispute that she had failed in her duties as a director to prevent Craig Paterson accepting customers’ payments in a time when he would have known the company was insolvent. Belinda Rogers’ ban lasts for two years and was effective from 1 June 2018.
Rob Clarke, Chief Investigator for the Insolvency Service, said:
Directors who favour themselves over the interests of their creditors when their company is in financial difficulty, as well as removing company funds for their own personal benefit leaving customers high and dry, are in clear breach of their directorship responsibilities.
This ban should serve as a warning to other directors tempted to help themselves before others that we have the necessary powers to investigate what has happened and seek to stop you from running a company for a significant amount of time.