Kilkeel Directors agree to disqualification

The Department of Enterprise, Trade and Investment (the Department) has accepted a disqualification undertaking for eight years from Thomas Michael McGreevy (52) of Newry Road, Kilkeel, County Down in respect of his conduct as a director of Blueharbour Properties Limited.

Blueharbour Properties Limited (the Company) carried on the business of building houses and developing sites from 182 Newry Road, Kilkeel and went into liquidation on 25 May 2006 with assets estimated to realise £4,140, no liabilities to preferential creditors, liabilities of £363,044.85 to non preferential creditors and an estimated deficiency as regards creditors of £358,904.85. After taking into account the losses incurred by members (shareholders, including the directors) of the company the total estimated deficiency was £358,905.85.

The Department accepted the disqualification undertaking from Thomas Michael McGreevy on 27 May 2009 based on the following unfit conduct which solely for the purposes of the disqualification procedure was not disputed:

• Misappropriating a total of £28,653.20 of monies in breach of his fiduciary duty to Blueharbour Properties Limited by using the money for his own benefit or that of Knomac Developments Limited of which he was a recorded director;
• Taking excessive remuneration totalling £61,195.06 by way of identifiable remuneration, expenses and benefits in kind, from Blueharbour Properties Limited in the period 13 January 2004 to 21 January 2005;
• Causing and allowing Blueharbour Properties Limited to fail to pay Crown monies totalling £100,368.09 consisting of £3,020.22 of PAYE for the year 2003/2004; and £2,766.57 of PAYE, £2,766.57 of NIC and £91,814.73 of VAT for the year 2004/2005;
• Causing and permitting Blueharbour Properties Limited to misuse a bank account in that a total of 14 cheques with a value of £45,083.32 were returned unpaid by the Northern Bank in the period 4 February 2004 to 28 January 2005 and fees of £532.00 were levied in respect of these dishonoured cheques;
• Failing to deliver up statutory records for Blueharbour Properties Limited to the Official Receiver.

Proceedings are continuing against another director of the company.

The Department has accepted 11 Disqualification Undertakings and the Court has not yet made any Disqualification Orders in the financial year commencing 1 April 2009.

Notes to Editors:

1. The Official Receiver, when a company is wound up by the Court, has a duty to investigate the causes of failure and report any 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 10 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 two 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, please contact DETI Press Office on 028 9052 9297. Out of office hours, please contact the Duty Press Officer via pager number 07699 715 440 and your call will be returned.