Directors

Even in small businesses, company directors have legally-defined responsibilities and duties which are often not much considered when the going is good, but which can become a minefield in circumstances of financial pressure. Restart BTi has the expertise on hand to guide directors through any such difficult circumstances and to offer the least damaging solutions.

Directors Liabilities

Due to the nature of limited company status, directors are not usually held personally liable for the debts of a company. However, trading while technically insolvent can expose to directors to personal liability for some or all of the company’s debts if it is judged that there has been deliberately wrongful or fraudulent trading. Accountants should be able to advise if the company slips into insolvency (which may not always be immediately obvious to directors) but our particular expertise as licensed insolvency practitioners provides access to the specific advice you will need in these circumstances.

Personal Guarantees

Directors’ personal guarantees are very common when money is borrowed or assets financed by the company concerned and if you have signed a guarantee you will be liable for any shortfall the creditor suffers should the company become formally insolvent, such as in the event of a Liquidation or Administration.

In the case that a guarantee has been signed by multiple directors, each will be ‘jointly and severally’ liable – meaning that any of them can be pursued for the total amount. This can often lead company directors to attempt to ‘trade their way’ out of a financial problem, hoping to recover the business’s fortunes and avoid personal liability. However, a failure to succeed in this can lead to disaster if the debts are still personally owed and, on top of that, legal action is taken for wrongful or fraudulent trading.

Never delay! Seek our help whilst we can still offer a solution. The horrifying cases you’ve read about all involve people who acted too late.