Court proceedings

[jones_guitar]

Hi,

- I had a limited company (call it company A);
- I had a supplier with this limited company (agency workforce);
- I started to dissolve the company in early 2019;
- The company was struck off later in 2019.
- I and the supplier were always on good terms;
- I informed the supplier that I was now a sole trader (early 2019), and to open an account accordingly (I thought this had happened);
- I started another limited company (company B) late 2019 (this is fine as they can still invoice me as a sole trader, and I pay them through the limited company - if anything this is more secure for them, as I am personally liable);
- They were still invoicing me through my old account (A) at the end of 2019 and the start of 2020.

I had two non-payers at the start of the year totalling just over 6.5k, I was ill for two months, and then Corona came.

I now owe them just over 4k (I reduced it by 5k, from 9k).

I did not really think too much of the invoicing through the wrong account (I didn't even notice until till the amounts got high with a 30-day payment term, then I realised they did it through the wrong account, pretty much by the time it was too late approaching Christmas).

They are now, rightly so, chasing their money. However, to be honest, I should have two accounts with them, I am starting to doubt if the sole trader account was even actually set up. Part of me thinks they kept supplying me (perhaps even because they liked me as a client).

Their third party collections (one a solicitor [initial]; one just collections [current]) both address to company B (looked up on Google probably). This is what gives me doubt. They must know that they should have assigned to the sole trader account, as there should be only one other account on their system? They must also have the account application form?

I even put in a response to their initial solicitor's letter (addressed to company A) that they have assigned to the wrong account, and that company A was struck off in 2019, and that I accept this. This would mean that using my logic, they would be able to pursue me personally, as I am basically telling them to look at their system.

Anyway, I am going to wait for the court papers. Any thought is welcome.

[R0b]

I even put in a response to their initial solicitor's letter (addressed to company A) that they have assigned to the wrong account, and that company A was struck off in 2019, and that I accept this. This would mean that using my logic, they would be able to pursue me personally, as I am basically telling them to look at their system.

Honesty isn't always the best policy especially if proceedings are issued against you. The simple defence would have been as you pointed out, the invoice was addressed to X company, which has been dissolved since 2019 and I am not liable to pay this invoice personally. It would have been up to them to prove that you were otherwise liable.

Now you've admitted it was probably a mistake, they could still potentially sue you for the amount because it may be deemed a mutual mistake and in these types of cases, the contract is voidable (not automatically void). The court will ccarry out an objective test and consider if the contract can be salvaged to make it work. There may be other legal arguments they could use to find you liable for the invoice but that depends on how savvy their solicitor is.

Not saying with any guarantee that they would be successful with the above argument, but curious what would your defence be if they did issue proceedings?

[jones_guitar]

Hi Rob, I realise that it wasn't the smartest thing to do. However, I said that they assigned to the wrong account, which brings in a new question. Is there even a second account? This is where I have to be careful. It appears to be that they seem to perhaps not know their own context/standing, or they have forgotten the conversation in 2019, or they know they have no legal standing although there is a second account (wrong entity being pursued). Whereas I believe that there was a second account, after all, I did ask for one to be opened. However, they may have simply not informed me that one couldn't be opened.

If I believe that I had a second account and one doesn't exist, that is their fault;
If I do have a second account and they supplied to me, I have already admitted this was a genuine error on their behalf.

It is down to them to work it out. I cannot work out why they are struggling. If I have a sole trader account it is easier for them. This is where I am a bit lost. This then brings in your question Rob. If there is no second account, they supplied in error. They appear to not even know their context, even when I have done half of the work for them.

If I received legal papers, I would probably just put the wrong entity being sued and reject it myself? Something simple along those lines? I would probably also use the maximum time to reply. They would need to come back to me, or not. I am not replying to them at all now until I get a court letter. I genuinely did originally support reducing their invoices, as I like them as a supplier and may choose to use them again in the future.

On a side note, the reason I am trying to not pay is because one of their opperarives appears to have taken a client potentially.