Working with creditors

Ideally, your customers pay you on time, without dispute. In reality there will be customers who delay payment, dispute accounts or whose cash flow is so impaired, you as a creditor will in effect be funding the business. What steps can you take to ensure your position is protected and how can we help?

Creditors dealing with insolvency

Creditors rank according to law, and each class of creditor shares in the available cash by way of a dividend. Depending on the amount available, you may get none, some or all of your money back. To qualify for a dividend, you should submit your claim to the insolvency practitioner dealing with the company. We can assist in the preparation of your claim, interpret the insolvency practitioner’s report, and assist with any voting decisions that you may face.

Preparing for recovery or insolvency

You might want as much information as possible about a debtor (individual or corporate) before you invest money in debt collection or an insolvency process. Speak to us about a desk top search and financial analysis of the party in question.

Where funds allow, we can be appointed in provisional or interim capacities in certain insolvency procedures, in advance of full appointment. At best, this may result in payment of the petitioning party’s debt, and at least allows a better understanding your client’s chances of recovery.

Acting as insolvency practitioners

We work with creditors and lenders throughout the UK, and are happy to accept instructions to act as insolvency practitioners on your behalf, if you wish to commence a formal insolvency process in your capacity as petitioning creditor. We can work with your solicitor or introduce you to one that can assist.

The formal company insolvency options available to you as a creditor are to petition the relevant court for insolvent liquidation or administration. For individuals, sole traders or partnerships, the relevant process is sequestration. In all processes, our job as insolvency practitioner is to get as much money back for the creditors as possible.

Retention of title (ROT)

If you are the supplier of physical items to a customer, you should have a tried and tested retention of title clause in your terms and conditions of sale. A workable ROT clause, with clear identification of your items, means that you should be able to recover items supplied but unpaid – notwithstanding delivery of the goods has been made. Insolvency is the most common event in which ROT is relied upon – make sure that it works for you. We can assist with a review of the contract process and identification of goods, and in the event that your customer goes into insolvency, support any ROT claim that you make.

We will help you assess your situation, explore your options, provide you with advice and develop a solution for you. To arrange a free, no obligation consultation click here or call 01592 630085