Company wants to fold but owes me money
Discussion
Company owes me a four-figure sum of money, and have done so for about a year now. I am not alone.
I believe they want to fold and open up shop in the same premises, with the same management, just under a different entity.
Does the law provide any recourse for this situation, or can they just write off the debts by wrapping up their business?
I believe they want to fold and open up shop in the same premises, with the same management, just under a different entity.
Does the law provide any recourse for this situation, or can they just write off the debts by wrapping up their business?
Word has it from inside that's the game plan. Registration of another company has already happened apparently. They owe tons of people money.
Letter of demand, and revocation of my services.
I must say that this is in Malaysia, but the laws here are broadly similar as they are in the UK, so as long as we don't get into too anything too specific I was hoping some general advice here would be useful.
Letter of demand, and revocation of my services.
I must say that this is in Malaysia, but the laws here are broadly similar as they are in the UK, so as long as we don't get into too anything too specific I was hoping some general advice here would be useful.
Under UK law, the directors can be held personally liable if they are aware that the company is unable to meet it's debts yet continue trading.
Proving this is another matter entirely, of course.
How valuable are your services to them? What happens if you stop providing them? How easy is it for them to get someone else to do your job? Have you supplied any goods which have not been paid for, or any intellectual property?
Proving this is another matter entirely, of course.
How valuable are your services to them? What happens if you stop providing them? How easy is it for them to get someone else to do your job? Have you supplied any goods which have not been paid for, or any intellectual property?
I am a web developer; they are an ad agency. I designed and published a couple of site for them as part of their campaigns they run for their clients. One in October 2009, another in May 2009.
As it turns out, I still host the sites and they don't yet have the source code. I call that leverage.
I just pulled the sites entirely about a couple of hours ago and, sure enough, it spooked the owner of the agency enough to actually write me a nice email to ask for the sites to be reinstated with assurance that part of the payment will be delivered by the end of the month. Due to the risk of the site being stolen (they are both static HTML sites with no dynamic processing going on), I am going to refuse this and insist on full payment prior to reinstatement to protect my interests.
At least I have this - many other vendors they owe (printing, design, multimedia production) are stuck because they have already delivered the goods.
It will probably mean my chances of getting work from them ever again are shot to death, but hey, I'm not so sure I want any contact with a business on such a cashflow tightrope anyway.
As it turns out, I still host the sites and they don't yet have the source code. I call that leverage.
I just pulled the sites entirely about a couple of hours ago and, sure enough, it spooked the owner of the agency enough to actually write me a nice email to ask for the sites to be reinstated with assurance that part of the payment will be delivered by the end of the month. Due to the risk of the site being stolen (they are both static HTML sites with no dynamic processing going on), I am going to refuse this and insist on full payment prior to reinstatement to protect my interests.
At least I have this - many other vendors they owe (printing, design, multimedia production) are stuck because they have already delivered the goods.
It will probably mean my chances of getting work from them ever again are shot to death, but hey, I'm not so sure I want any contact with a business on such a cashflow tightrope anyway.
joewilliams said:
Under UK law, the directors can be held personally liable if they are aware that the company is unable to meet it's debts yet continue trading.
Proving this is another matter entirely, of course.
How many directors actually fall liable in court? I've been through a couple of phoenix situations as an employee and was gobsmacked at the level of debt that could disappear. Proving this is another matter entirely, of course.
-DeaDLocK- said:
I am a web developer; they are an ad agency. I designed and published a couple of site for them as part of their campaigns they run for their clients. One in October 2009, another in May 2009.
As it turns out, I still host the sites and they don't yet have the source code. I call that leverage.
I just pulled the sites entirely about a couple of hours ago and, sure enough, it spooked the owner of the agency enough to actually write me a nice email to ask for the sites to be reinstated with assurance that part of the payment will be delivered by the end of the month. Due to the risk of the site being stolen (they are both static HTML sites with no dynamic processing going on), I am going to refuse this and insist on full payment prior to reinstatement to protect my interests.
At least I have this - many other vendors they owe (printing, design, multimedia production) are stuck because they have already delivered the goods.
It will probably mean my chances of getting work from them ever again are shot to death, but hey, I'm not so sure I want any contact with a business on such a cashflow tightrope anyway.
Destroy the site, wipe the code and write the cash off.As it turns out, I still host the sites and they don't yet have the source code. I call that leverage.
I just pulled the sites entirely about a couple of hours ago and, sure enough, it spooked the owner of the agency enough to actually write me a nice email to ask for the sites to be reinstated with assurance that part of the payment will be delivered by the end of the month. Due to the risk of the site being stolen (they are both static HTML sites with no dynamic processing going on), I am going to refuse this and insist on full payment prior to reinstatement to protect my interests.
At least I have this - many other vendors they owe (printing, design, multimedia production) are stuck because they have already delivered the goods.
It will probably mean my chances of getting work from them ever again are shot to death, but hey, I'm not so sure I want any contact with a business on such a cashflow tightrope anyway.
At least you will get some satisfaction.
-DeaDLocK- said:
It will probably mean my chances of getting work from them ever again are shot to death, but hey, I'm not so sure I want any contact with a business on such a cashflow tightrope anyway.
Good choice. Stick with it and if they really have the money they'll pay you ASAP. If they don't, at least you know they won't keep the site.-DeaDLocK- said:
I am a web developer; they are an ad agency. I designed and published a couple of site for them as part of their campaigns they run for their clients. One in October 2009, another in May 2009.
As it turns out, I still host the sites and they don't yet have the source code. I call that leverage.
I just pulled the sites entirely about a couple of hours ago and, sure enough, it spooked the owner of the agency enough to actually write me a nice email to ask for the sites to be reinstated with assurance that part of the payment will be delivered by the end of the month. Due to the risk of the site being stolen (they are both static HTML sites with no dynamic processing going on), I am going to refuse this and insist on full payment prior to reinstatement to protect my interests.
At least I have this - many other vendors they owe (printing, design, multimedia production) are stuck because they have already delivered the goods.
It will probably mean my chances of getting work from them ever again are shot to death, but hey, I'm not so sure I want any contact with a business on such a cashflow tightrope anyway.
If these are sites they have asked you to do for clients, go to the clients...As it turns out, I still host the sites and they don't yet have the source code. I call that leverage.
I just pulled the sites entirely about a couple of hours ago and, sure enough, it spooked the owner of the agency enough to actually write me a nice email to ask for the sites to be reinstated with assurance that part of the payment will be delivered by the end of the month. Due to the risk of the site being stolen (they are both static HTML sites with no dynamic processing going on), I am going to refuse this and insist on full payment prior to reinstatement to protect my interests.
At least I have this - many other vendors they owe (printing, design, multimedia production) are stuck because they have already delivered the goods.
It will probably mean my chances of getting work from them ever again are shot to death, but hey, I'm not so sure I want any contact with a business on such a cashflow tightrope anyway.
D
davidd said:
If these are sites they have asked you to do for clients, go to the clients...
D
I'd do this ^D
Tell the clients that you've pulled the sites and the reasons why, and I would think they'd either negotiate directly with you to get the sites reinstated or put serious pressure on the people owing you money to get it sorted out.
-DeaDLocK- said:
I just pulled the sites entirely about a couple of hours ago and, sure enough, it spooked the owner of the agency enough to actually write me a nice email to ask for the sites to be reinstated with assurance that part of the payment will be delivered by the end of the month. Due to the risk of the site being stolen (they are both static HTML sites with no dynamic processing going on), I am going to refuse this and insist on full payment prior to reinstatement to protect my interests.
Well done.Stick on that, and don't move on it until you have *cleared funds*.
You've been messed around and not paid for over a year and they have had all of that time to pay you. Don't get duped by the 'end of the month' stuff to give them enough time to shut up shop or copy the code.
They will have enough cash to pay you, they just want to strip as much cash as possible before shutting. Failing that, the director can put his hand in his pocket.
If the company or the MD don't have enough cash to pay you, they are going bust anyway...
jon- said:
joewilliams said:
Under UK law, the directors can be held personally liable if they are aware that the company is unable to meet it's debts yet continue trading.
Proving this is another matter entirely, of course.
How many directors actually fall liable in court? I've been through a couple of phoenix situations as an employee and was gobsmacked at the level of debt that could disappear. Proving this is another matter entirely, of course.
Broadly, a third party can only AFAIK claim directly from a Director if that Director has given a written commitment that monies will be forthcoming and that the company is solvent when both are entirely false. It is possible, but it is very difficult, and potentially expensive, to make it happen.
Otherwise, as I said, only the liquidator can try to claim off the Director. This does happen, but usually only in circumstances of exceptionally large amounts of wrong-doing and with very large debts; that being so, the Director may be ruined financially, but even then it will only be a drop in the ocean of the company's debts.
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