The Key Issue
Our client was the owner of a glasswork company that found itself in financial difficulty. This was mainly caused by a disputed debt related to a joint building project. During a particularly critical period, a supplier issued a statutory demand for £24,000 to our client’s family home, strategically timed shortly before Christmas day.
This was a deliberate attempt to take advantage of the holiday season, with the creditor hoping that the demand would be ignored, thereby allowing them to initiate a winding up petition. The creditor’s intent was to force the company into liquidation, despite the fact that the company’s assets were insufficient to cover the claimed debt. Essentially, the statutory demand was issued to intimidate our client into paying an amount they disputed.
Why The Client Came To Us
Our client’s business was his livelihood, and if it had ceased trading, it would have been disastrous for him and his family. Recognising the urgent need for immediate action to prevent the impending threat to his business, our client sought our assistance.
What We Did
Prevented a Winding-Up Petition: We promptly assisted our client in submitting an application to set aside the statutory demand and prevent the presentation of a winding up petition. By initiating this process, we bought valuable time to dispute the debt amount and safeguard the company’s operations.
Disputing the Amount: Utilising our expertise in debt resolution, we thoroughly examined the evidence and identified discrepancies in the creditor’s claim. We collected and presented compelling evidence to dispute the amount demanded by the creditor, highlighting any inaccuracies or unsubstantiated claims.
Resolution and Debt Recovery: Through diligent negotiation and presentation of evidence, we successfully convinced the creditor to withdraw the statutory demand. Additionally, during the course of our investigations, we discovered that the company actually owed money to our client. As a result, the client engaged debt recovery agents to pursue the creditor and recover the rightful amount owed.
Outcome
By taking action, we successfully prevented the company from being issued with a winding up petition. The withdrawal of the statutory demand provided the company with crucial breathing room and allowed it to continue its operations without the threat of liquidation. Furthermore, the revelation that the company owed our client money ensured that the appropriate measures were taken to recover the debt owed.
This case illustrates the importance of quick action in addressing relatively small debts before they escalate into significant problems for businesses. Despite the modest amounts involved, the timing and intent of the disputed debt posed a substantial risk to our client’s company. By providing timely and effective solutions, we helped our client navigate a potentially disastrous situation, protecting their business and ensuring its continued success.
