Lisburn directors agree to disqualification

The Department of Enterprise, Trade and Investment (the Department) has accepted a disqualification undertaking for six years from Barry Smith (45) of Sequoia Park, Lisburn, in respect of his conduct as a director of Blue Print Refurbishment Limited.

The Department has also accepted a disqualification undertaking for two years from Elizabeth Smith (41) of Sequoia Park, Lisburn in respect of her conduct as a director of the same company.

Blue Print Refurbishment Limited carried on the business of refurbishment from Unit 10 City Business Park, The Cutts, Belfast and went into liquidation on 2 February 2006 with assets of £Nil; liabilities of £1,155,664 and an estimated deficiency as regards creditors of £1,155,664. After taking into account the losses incurred by members (shareholders, including the directors) of the company the total deficiency was £1,155,666.

In cases where a director offers a disqualification undertaking acceptable to the Department, thus avoiding a full hearing of the matter before the court, a shorter period of disqualification than would otherwise be appropriate is normally imposed.

The Department accepted the disqualification undertakings from Barry Smith and Elizabeth Smith on 8 November 2007 based on the following unfit conduct which solely for the purposes of the disqualification procedure was not disputed:

Causing and permitting Blue Print Refurbishment Limited to trade at a time when it was insolvent from 31 December 2004;

Causing and permitting Blue Print Refurbishment Limited to retain £238,093.43 of debts properly payable to the Crown;

Causing and permitting Blue Print Refurbishment Limited to misuse a bank account in Northern Bank in that during the period 14 January 2005 to 3 January 2006, 147 cheques with a value of £404,225.38 were dishonoured and in the period 22 August 2005 to 3 January 2006, a total of 37 direct debits were returned unpaid, with a value of £24,448.21;

Filing late annual returns with companies registry, for the years to 8 June 2001, 8 June 2002, 8 June 2003 and 8 June 2004;

Failing to maintain and deliver up statutory records to the Official Receiver.

The Department has accepted 12 Disqualification Undertakings and the Court has made 9 Disqualification Orders in the financial year commencing 1 April 2007.

Notes to Editors:

1. Barry Smith and Elizabeth Smith are husband and wife.
2. 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.
3. 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.
4. Article 9 of the 2002 Order provides that were 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 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 02890 548516.
7. The period of disqualification commences at the end of the 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 9297. Out of office hours please contact the Duty Press Office via pager number 07699 715 440 and your call will be returned.