Company Voluntary Arrangement
Discussion
In my experience the customer is in financial difficulties, look here for more info
www.middletonpartners.co.uk/company_voluntary_arrangement.htm
If he owes you money tread carefully.
Regards
simon
www.middletonpartners.co.uk/company_voluntary_arrangement.htm
If he owes you money tread carefully.
Regards
simon
A CVA is a proposal to creditors to accept a lower or extended repayment terms on a company's debts. It is done through the courts and if agreed (by 75% of the creditors by value I think) then it is legally binding and no creditor can persue them for any debts included within the CVA providing they comply with it't terms. It will be monitored by an insolvancy practitioner who is generally an accountant.
Irrespective of this, until the CVA is agreed (if at all) then business continues as usual and if you feel you will not get paid and the machine still legally belongs to you and I suppose you would be within your rights to collect it.
Irrespective of this, until the CVA is agreed (if at all) then business continues as usual and if you feel you will not get paid and the machine still legally belongs to you and I suppose you would be within your rights to collect it.
I've been on the wrong end of several of these. I've never seen anybody trade out of it, and receivership followed rapidly.
Sorry to bring bad news.
We were successful is repossessing our goods, however, on a number of occasions. Be bold, don't worry too much about the rules.
possession is more than nine tenths
Sorry to bring bad news.
We were successful is repossessing our goods, however, on a number of occasions. Be bold, don't worry too much about the rules.
possession is more than nine tenths
2 sMoKiN bArReLs said:
I thought that if the invoice states "good belong to me unless paid for by you in full" then even if the company goes bust - you still get your goods back.
If life were so simple.
isnt that the problem with all the Rovers stuck in a field? they cant be sold because the title of the components in them weren't transferred to Rover, so the administrators are unable to sell them?
You need to understand the reasons for the business entering a CVA. I am 'in the industry' although on the restructuring, not insolvency, side and am no fan of CVA's as in my experience they generally do not succeed.
In general they do nothing to improve the underlying performance of the business - and if it failed once then why wouldn't it fail again?
However, they can sometimes be used to good effect if the underlying business is good but it has been affected by either a one off problem or, very recently, is being driven to insolvency due to a pension liability - the PPF have recently agreed to a CVA proposal (which incorporated an injection of new equity, them getting an equity stake and a bullet payment). In this case the base business is good and a CVA works.
You're unclear on the exact position - the company may be in a moratorium period at the moment - this would limit your ability to enforce any security / collection of debt etc (sorry) - that said if it was my business I would be sending a van round sharpish too!
In general they do nothing to improve the underlying performance of the business - and if it failed once then why wouldn't it fail again?
However, they can sometimes be used to good effect if the underlying business is good but it has been affected by either a one off problem or, very recently, is being driven to insolvency due to a pension liability - the PPF have recently agreed to a CVA proposal (which incorporated an injection of new equity, them getting an equity stake and a bullet payment). In this case the base business is good and a CVA works.
You're unclear on the exact position - the company may be in a moratorium period at the moment - this would limit your ability to enforce any security / collection of debt etc (sorry) - that said if it was my business I would be sending a van round sharpish too!
sleepezy said:
that said if it was my business I would be sending a van round sharpish too!
I knew a video company that was about to go pop. At the eleventh hour, almost literally, a van and two estate cars appeared by the side entrance. One of the staff went to security at front desk and aksed to be let in claiming he'd forgotten something. Once in, he unlocked the side door and most of the useful/valuable contents disappeared...
tinman0 said:
I thought that if the invoice states "good belong to me unless paid for by you in full" then even if the company goes bust - you still get your goods back.
Not a chance I'm afraid! (Although the same phrase is on my invoices - every little helps)
If an administrator/liquidator is appointed, you'd be laughed at - you need to be able to prove that those are your terms of trade and that they were known at the outset.
On receipt of order, send an acknowledgement which just happens to include your T&Cs - then you're covered, but a court will not recognize terms imposed on an invoice because it's deemed to be after the event.
There are of course, always unofficial means depending on the circumstances. I've known people be begged by the liquidator to remove their stock once it's been pointed out how hazardous it is for example.
I can recommend a good commercial debt recovery outfit (no connection) although I hate to say that it may be too late judging from your post - hope you get it resolved though.
tinman0 said:
isnt that the problem with all the Rovers stuck in a field? they cant be sold because the title of the components in them weren't transferred to Rover, so the administrators are unable to sell them?
I wouldn't have thought so (although not entirely sure) - retention of title normally fails when the products supplied are incorporated into your manufacturing process (and therefore the nature of them has been altered) - however I can see the point on components that can be easily removed so it may be the case.
Re ROT clauses - the best way of covering yourself is to:
ensure you supplier countersigns a formal terms sheet before you commence trading with them
repeat the terms on the back of every invoice, definitely refer to ROT terms on the face of the invoice and pref. repeat as much of the ROT terms as you can (on the face of the invoice)
if faxing an invoice - always fax the back as well (if that's where the terms are) and get confirmation that both pages received and agreed to
try to identify individual items by unique serial no.s if practical (which are referred to on your invoice) - don't rely on the wrapping of several boxes, if the wrapping is removed then the chain of evidence to your supply is/can be broken
try to use an 'all assets' ROT clause - this is one that enables you to recover any of your identifiable supplied goods to the value of your o/s claim - the alternative specifically and directly links invoices to particular products (this means that if your customer uses your latest supply but pays for the older goods your ROT claim fails as you can only recover items specifically relating to the o/s invoices)
always attend the customer site ASAP when being advised of an appointment to identify assets - anything used before you turn up cannot be included in your claim - you do not have to remove them on day 1 (and have no right to until the ROT claim is agreed), if you identify them (could try to get them quarantened) and the IP uses them he has to pay for them
generally the best result for everybody is for you to agree to leave the assets there for the IP to trade with - this way you'll be paid (assuming ROT OK) and avoid costs of removing assets etc which can be uneconomical
always expect the IP to try it on, he/she has nothing to lose!
Get ROT clauses off the net (plenty site have them for free) and check regularly as they can be updated to reflect latest case law.
I will get hold of our ROT checklist on Tuesday (the things we check to see if we cann weedle out of agreeing ROT
) to see if there's anything i've forgotten. The IP is under a duty to seek the best results for the body of creditors as a whole - therefore he is under a duty to realise value of the assets if he can - hence his attitude - I can see the suppliers point of view tho! (sorry for the above being a bit long but thought it might help someone - note it is also a bit general to cover many supply types and i am fully aware that much may not be commercially practical in some cases)
>> Edited by sleepezy on Monday 24th April 22:24
>> Edited by sleepezy on Monday 24th April 22:25
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