company in adminstration owes us money - question

[dcw@pr]

a company has gone into admistration which owes us some money, which was invoiced about a month before they went bust. We also have a contract with them to supply two more "products" in the next 6 months. Should I include on the creditors form just the money that we have invoiced already, or that plus the amount that is owed to us in future under contract?

The liquidators say don't include it - but then they would say that wouldn't they, and it doesn't seem correct to me.

Probably won't get anything back anyway so most likely a moot point...

[Broccers]

You'll probably not see a penny from the first invoice David, certainly my experience. As for jobs not yet done, no chance.

[dcw@pr]

Broccers said:

You'll probably not see a penny from the first invoice David, certainly my experience. As for jobs not yet done, no chance.

agreed, but should i put them on the claim?

[jamesuk28]

Your only hope is to have the directors for wrongfull trading, but its hard to prove.

[dcw@pr]

jamesuk28 said:

Your only hope is to have the directors for wrongfull trading, but its hard to prove.

i dont think there is any question of that

[sleepezy]

If there's a contract for supply then you could, in theory, submit a claim including any lost earnings (or compensation for costs incurred).

However you are under a duty to mitigate your losses - so, for example, if you can find an alternative buyer for the product your claim should be reduced by the profit earned in that new transaction.

But...I'm guessng this is all academic. If there's no assets available for distribution to unsecured creditors (unlikely with a prescribed part), or the distribution is relatively small, there's probably no economical point in worrying about it.

[jamesuk28]

dcw@pr said:

jamesuk28 said:

Your only hope is to have the directors for wrongfull trading, but its hard to prove.

i dont think there is any question of that

Not sure why you say that. If the company has gone into administration the usual reason is because they cant afford to run the company, ie meet its liabilities.

That does not usually suddenly creep up. So if they were still ordering goods or services 1 month before the date they went into administartion, it tends to indicate they were already insolvent or knew they would be, hence my comment of wrongful trading. But you obviously are privee to more info so good luck.

[Stitch]

Do you have retention of title on any of the 'product'?

Could you switch something off?

Only chance of getting anything is to have some lever over the administrator.

Is the administrator trying to sell the business on, new buyer would factor in having to make good some old company creditors if they are absolutely critical to the business

[john_p]

Stitch said:

Is the administrator trying to sell the business on, new buyer would factor in having to make good some old company creditors if they are absolutely critical to the business

This is the best angle to take, see what's going to happen with the company. If someone is stepping in to take over (especially if the whole administration has been "planned") then you'd do well to speak to the new owners (directly) and offer your services. You might need to be sneaky to get around the administrator.

If it's going to be junked then cut your losses, move on and write the whole lot off.

[dcw@pr]

it's possible that the company will be taken over.

I have been in this position before so I am fully expecting to not recover a penny as has been the case in the past, but I just wondered whether it was correct to put on the creditors form something that was contracted for the future.