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Advice Please - Supplier Dissolved

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  • Advice Please - Supplier Dissolved

    Hi

    I run a non-league football team which I set up in 2013.

    Back in February, the local branch of an national Company approached me about sponsoring one of our team. Being a non-profit organization and in need of the support of local business to survive this sponsorship was gratefully accepted. The sponsorship they offered was to purchase one of our sides a kit.

    I subsequently obtained kit quotes from various suppliers and after presenting them to the sponsor they indicated which of the quotes suited the budget they had available.

    The supplier I chose, from the options that suited their budget, I chose for one specific reason, that being, the supplier in question had provided a local semi-pro Club with their kit a few seasons before so I knew it would be of a decent quality and the Company was genuine.

    Our sponsor paid for the kit via BACs direct to the supplier. This was back in February

    The quote stated the kit would be delivered in 5 weeks.

    Having not received the kit by the end of April I contacted the supplier who replied to say the kit would be delivered the following week.....it never came.

    Since then I have made several attempts to contact the supplier without reply. Last night I looked at the Companies House register to discover the business dissolved at the beginning of April, before their last communication.

    Today I have the horrible task of informing our sponsor what has happened, but I would like to do that with some knowledge of what I can do to get the money back if anything.


    Tags: None

  • #2
    Morning,

    It is sad to hear something like this however from a legal perspective, it is likely that you won't be able to get any of the money back. The basics of contract law is something known as privity of contract, in other words if you are not a party to a contract then you have no rights to pursue or be pursued.

    Limited companies are a separate legal entity and just because a shareholder or director sits behind the company does not mean they are liable for any contracts entered into by the company. There are some exceptions to that general rule but it is in the rarest of circumstances will you ever be able to fall within that category - many have tried and failed and you would need expert legal advice to even think about that, plus being a not for profit, there is the risk of the legal fees potentially wiping you out if you lost your case.

    Chalk it up to experience but moving forward, I would suggest you carry out some due diligence on the company before you contract with them. A credit check against smaller businesses will cost you little but can give a massive insight into their financials. Check the directors of the company, do they own other companies and if so, how long have they lasted? If there have been multiple companies which lasted only a couple of years that may be a red flag and should query it. Equally, you could get one of the directors to enter into a personal guarantee, which means that if the company fails to deliver, then the director is on the hook for any losses - this is what banks do when they lend to small businesses.

    If you have a question about the voluntary termination process, please read this guide first, as it should have all the answers you need. Please do not hijack another person's thread as I will not respond to you
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    LEGAL DISCLAIMER
    Please be aware that this is a public forum and is therefore accessible to anyone. The content I post on this forum is not intended to be legal advice nor does it establish any client-lawyer type relationship between you and me. Therefore any use of my content is at your own risk and I cannot be held responsible in any way. It is always recommended that you seek independent legal advice.

    Comment


    • #3
      Hi

      Thank you for the reply. I know nothing about what happens when a Company dissolves so clutch at straw is there a chance the kit could be somewhere ie in the shop still in the possession an administrator or something.

      Also what is the situation if they were still operating despite being dissolved, only asking as there is still activity on their twitter page this month about having supplied some stuff to a junior side.

      Comment


      • #4
        How have they dissolved ? ( can you paste the text from Co House or give us a link to the company page )
        #staysafestayhome

        Any support I provide is offered without liability, if you are unsure please seek professional legal guidance.

        Received a Court Claim? Read >>>>> First Steps

        Comment


        • #5
          I got my info from this link

          https://beta.companieshouse.gov.uk/company/05858665

          They have a WhatsApps and the status to that is currently online so I have sent a message to them, just asking for an update on delivery of the order. I'm waiting to see if I get a reply.

          Comment


          • #6
            It really depends on whether you were contracting with the limited company at the time or with him personally - I would assume it was the limited co.

            Even if they are active now and the company is dissolved, it could mean that they are now trading under some other form of business structure (but under the same guise) for example a sole trader which in that case, would be liable personally to you. But again, unless you are privy to the contract, you can't sue or be sued.

            You would have to prove that the company was a sham in order to hold the director personally liable but as above, very hard to prove.
            If you have a question about the voluntary termination process, please read this guide first, as it should have all the answers you need. Please do not hijack another person's thread as I will not respond to you
            - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
            LEGAL DISCLAIMER
            Please be aware that this is a public forum and is therefore accessible to anyone. The content I post on this forum is not intended to be legal advice nor does it establish any client-lawyer type relationship between you and me. Therefore any use of my content is at your own risk and I cannot be held responsible in any way. It is always recommended that you seek independent legal advice.

            Comment


            • #7
              Thanks once again, as I say I'm not too law savvy.

              So would an email from the Company after its recorded dissolved date carry any weight ie by sending that email they are still implying they are still trading.

              Comment


              • #8
                Absolutely none at all in my view as you would then be seen to be entering into a new contract, unless they accept liability or you can prove it was all a sham. Unfortunately, people set up companies purely for the purpose of distancing themselves at arms length and to avoid personal liability if something goes wrong. Many small businesses I have seen get into financial difficulty, dissolve the company and then set up a new company operating in the same way - it's unfair but not unlawful.

                If you wanted to pursue something like this then you are venturing into an area which requires specialist legal advice and there would always be a risk in pursing it.
                If you have a question about the voluntary termination process, please read this guide first, as it should have all the answers you need. Please do not hijack another person's thread as I will not respond to you
                - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
                LEGAL DISCLAIMER
                Please be aware that this is a public forum and is therefore accessible to anyone. The content I post on this forum is not intended to be legal advice nor does it establish any client-lawyer type relationship between you and me. Therefore any use of my content is at your own risk and I cannot be held responsible in any way. It is always recommended that you seek independent legal advice.

                Comment


                • #9
                  Ok well it looks like that's that then.....thanks very much for the replies. I will now set about breaking the news to the Sponor.

                  I'll also drop one final, polite, email to the Company in question.

                  Comment


                  • #10
                    Just thought I'd ask one more question

                    I've attached a copy of the order and it has the name MaxJosh Ltd on it. This Company is still active according to Companies House. Does this help us.
                    Attached Files

                    Comment


                    • #11
                      Well that would say the contract is with MaxJosh ltd not Joshila. Therefore if they haven't supplied the purchased goods they should refund you. ( well the sponsor who ordered and paid for them ) .

                      https://beta.companieshouse.gov.uk/c...89758/officers
                      #staysafestayhome

                      Any support I provide is offered without liability, if you are unsure please seek professional legal guidance.

                      Received a Court Claim? Read >>>>> First Steps

                      Comment


                      • #12
                        Thanks for that. I will draft a letter to the Company giving them 14 days to either supply the goods or issue a full refund.

                        Comment

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