Antrim director agrees to disqualification

The Department of Enterprise, Trade and Investment (the Department) has accepted a disqualification undertaking for seven years from the director of a tiling company.
~ Thursday, 2 February 2012

Graham Samuel Maze (52) of Chapeltown Road, Antrim was disqualified in respect of his conduct as a director of Eurotile Marketing Limited (“the Company”).

The Department had previously accepted disqualification undertakings of four years from three other directors in respect of their conduct as directors of the same Company.

The Company carried on the business of the wholesale and retail supply of tiles and commercial tiling contracts from multiple locations and entered into Administrative Receivership on 22 April 2008 with estimated assets available to unsecured creditors of £233,723, liabilities of £14,936 to preferential creditors, liabilities of £242,160 to floating charge holders, liabilities of £1,515,087 to non-preferential creditors, and a deficiency as regards creditors of £1,538,460. After taking into account the losses incurred by members (shareholders, including the directors) of the Company the total estimated deficiency was £1,638,460.

The Department accepted the disqualification undertaking from Graham Samuel Maze on 21 February 2011 based on the following unfit conduct which solely for the purposes of the disqualification procedure was not disputed:

• submitting a materially inaccurate Statement of Affairs in that he overstated the assets and understated the creditors;
• causing and permitting the Company to trade from 18 April 2007 to 4 February 2008 at a time when he knew or ought to have known it was insolvent, to the detriment of creditors;
• causing and permitting the Company to fail to pay a total of £283,909 properly payable to the Crown comprising £2,634 in respect of VAT for the year 2006/07, £52,842 in respect of PAYE for the year 2007/08, £57,529 in respect of NIC for the year 2007/08 and £170,903 in respect of VAT for the year 2007/08;
• failing to maintain proper and accurate accounting records and failing to adequately monitor the Company’s performance/exercise adequate financial control over the Company;
• taking excessive remuneration from the Company given its financial position;
• failing to give a satisfactory explanation for the deficiency in the Company’s assets;
• causing and permitting the Company to misuse its bank account at First Trust bank in that 23 cheques with a value of £203,122 were returned unpaid in the period 27 September 2007 to 10 April 2008 and 19 direct debits with a value of £11,505 were returned unpaid;
• causing and permitting the Company to make payment of dividends to shareholders that were contrary to the Articles of Association of the Company, not properly declared and were unlawful.

The Department has accepted 38 Disqualification Undertakings and the Court have made 12 orders disqualifying directors in the financial year commencing 1 April 2011.

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 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 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.