Ballynahinch director agrees to disqualification

The Department of Enterprise, Trade and Investment (the Department) has accepted a disqualification undertaking for six years from David John Wilson (47) of Brookside Road, Ballynahinch, Co Down, in respect of his conduct as a director of Irish Polymers Limited (“the Company”).

The Company carried on the business of waste material recycling from Nutts Corner Business Park, Dundrod Road, Crumlin, from December 2005 until it went into liquidation on 9 April 2008 with estimated uncharged assets of £152,500, liabilities of £7,131 to preferential creditors, liabilities of £244,222 to floating charge holders, liabilities of £1,302,042 to non preferential creditors and an estimated deficiency as regards creditors of £1,400,895. After taking into account the losses incurred by members (shareholders, including the directors) of the company the total estimated deficiency was £1,510,895.

The Department accepted the disqualification undertaking from David John Wilson on 20 July 2010 based on the following unfit conduct which solely for the purposes of the disqualification procedure was not disputed:

• Causing and permitting the Company to trade at the expense of creditors in that he allowed the Crown debt to increase by £69,947 and the company’s overall liabilities to increase by £340,496 between the date the directors first took insolvency advice in March 2007 to the date of the proposed CVA in September 2007 and a further increase in liabilities of £177,074 between the date of the CVA and the date of liquidation.
• Causing and permitting the Company to make a payment of £4,400 to himself rather than to trade creditors which by Order of the High Court of Justice in Northern Ireland on 8 October 2009 constituted a preference within the meaning of Article 203 of the Insolvency (Northern Ireland) Order 1989.
• Proposing a Company Voluntary Arrangement without establishing his ability to raise investment funds, ultimately causing the failure of the Company Voluntary Arrangement when he was unable to raise the required funding.
• Failing to comply with Article 235 of the Companies (Northern Ireland) Order 1986 in that accounts for the year ended 31 March 2007 were not filed in Companies Registry.
• Failing to comply with Article 371(1) of the Companies (Northern Ireland) Order 1986 in that the annual return for the year ended 13 October 2007, which should have been filed by 10 November 2007, was not filed.

The Department has accepted 13 Disqualification Undertakings and the Court has made an order disqualifying one director in the financial year commencing 1 April 2010.

Notes to editors:

1. Insolvency Practitioners acting as voluntary liquidators, administrative receivers and administrators have a duty to report unfit conduct to the Insolvency Service within the Department of Enterprise, Trade and Investment.
2. The aim of the Department is to bring disqualification proceedings against those directors of failed companies who have abused the privilege of limited liability status through negligence, incompetence or lack of commercial probity. The legislation contained in the Company Directors Disqualification (Northern Ireland) Order 2002 (“the 2002 Order”) is for the protection of the public and trading community but its operation should not inhibit genuine enterprise.
3. In cases where a person is subject to either a Disqualification Order made by the Court or a Disqualification Undertaking accepted by the Department, that person shall not be a director of a company, act as a receiver of a company's property or in any way, whether directly or indirectly, be concerned or take part in the promotion, formation or management of a company unless he has the leave of the High Court. A disqualified person cannot obtain permission to act as an Insolvency Practitioner.
4. Article 9 of the 2002 Order provides that where a director is found to be unfit he must be disqualified for a minimum period of two years, up to a maximum of fifteen years. The Courts have decided that the level of seriousness of unfit conduct can fall into three brackets with the top bracket of periods over ten years reserved for particularly serious cases, six to ten years reserved for cases which do not merit the top bracket and two to five years for cases where, although disqualification is mandatory, the case is less serious.
5. The 2002 Order also allows directors, with the agreement of the Department, to avoid the need for a court hearing by offering an acceptable Disqualification Undertaking. This has exactly the same legal effect as a Disqualification Order made by the court, and will usually include a schedule identifying the director’s unfit conduct. The consequences of breaching a Disqualification Undertaking are the same as those for breaching a Disqualification Order.
6. If anybody contravenes a Disqualification Order or breaches their Disqualification Undertaking they may be committing a criminal offence and could go to prison for up to 2 years or face a fine or both. Any person with information to suggest that a disqualified person has acted in contravention of this provision should contact The Insolvency Service’s Directors Disqualification Unit on 028 90 548516.
7. The period of disqualification commences at the end of 21 days beginning with the day the Disqualification Undertaking was accepted by the Department.
8. For media enquiries contact DETI Press Office on 028 9052 9604. Out of office hours please contact the Duty Press Officer via pager number 07699 715 440 and your call will be returned.