Whitehead director disqualified by the court

The Department of Enterprise, Trade and Investment (the Department) has accepted a disqualification undertaking for five years from Michael Devine (42) of Old Forde, Whitehead, Co Antrim in respect of his conduct as a director of PVC Trade Supplies Limited.

PVC Trade Supplies Limited was incorporated on 25 September 2004 and carried on the business of manufacture and assembly of archways, doors, window frames and conservatories from Unit 55-59 Ledcom Industrial Estate, Bank Road, Larne.  

It  went into liquidation on 10 August 2007 with estimated assets of £7,600, liabilities of £411,048 to non preferential creditors and an estimated deficiency as regards creditors of £403,448.  After taking into account the losses incurred by members (shareholders, including the directors) of the company the total deficiency was £403,449.

The Department accepted the disqualification undertaking from Michael Devine on 19 January 2010 based on the following unfit conduct which solely for the purposes of the disqualification procedure was not disputed:

• Causing and permitting PVC Trade Supplies Limited to retain £281,348.10 of monies properly payable to HM Revenue & Customs comprising outstanding PAYE and NIC for the periods 2006/07 to 2007/08 of £131,478.94 and VAT for the periods 2005/06 to 2007/08 of £149,869.16.
• Causing PVC Trade Supplies Limited to trade from 1 May 2006 until July 2007 when he knew or ought to have known that it was insolvent.
• Failing to ensure that accounts for PVC Trade Supplies Limited were filed with Companies Registry for the years ended 28 February 2005 and 28 February 2006 in accordance with Article 235 of the Companies (Northern Ireland) Order 1986 as amended by Article 6 of the Companies (Northern Ireland) Order 1990.
• Failing to ensure that the Annual Returns for PVC Trade Supplies Limited for the years ended 23 October 2005 and 23 October 2006 were filed, contrary to Article 371(1) of the Companies (Northern Ireland) Order 1986.
• Failing to ensure that adequate books and records were maintained/preserved/delivered up for PVC Trade Supplies Limited.

There have been 19 directors disqualified in the financial year commencing 1 April 2009.

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 90529604.