HomeFWJ TakeawayWinding up petitionsDefending a winding up petitionHow to defend a winding up petition

Defending a winding up petition properly can make the difference between the company continuing to trade - or being wound up. Our experts have dealt with 100's of these situations and know the best way to help a company facing a winding up order. Let us help you too.

Defending a winding up petition is possible – although only in certain circumstances. It must be remembered that a petitioner is able to issue a winding up petition where a debt of only £750 or more is validly due and owing.

However, in considering how to defend a winding up petition, the issues to consider are as follows:

  • Is the debt subject to a genuine dispute? If the winding up order debt is genuinely disputed, then the winding up procedure is the wrong one for a petitioner to use in order to collect the debt. The right procedure is a “Part 7” claim in the traditional court and not the winding up insolvency court. If the debt is subject to a genuine dispute the court will strike out the winding up petition and order costs in your favour. However, legal advice is highly recommended to consider whether you have a genuine dispute or not. For example, simple cashflow difficulties and inability to pay now is not a genuine dispute. However, a dispute over whose terms and conditions bind the contract or whether the goods/services supplied are defective could constitute genuine grounds to dispute the debt. So long as you can dispute the debt and show that less than £750 is genuinely due and owing, then the petition can be struck out.
  • If you have a counterclaim against the petitioner, this can lead to the petition being struck out. For example, if the debt claimed is £7,000 but you have a separate claim against the petitioner in respect of another matter or for losses arising out of the contract under which the goods or services were supplied, then this can lead to the petition being struck out if your claim overreaches their claim. For example, if your claim is £8,000 then the net effect is that your position is that the petitioner owes you the money and not the other way around. This can lead to a winding up petition being struck out.
  • If the winding up petition document is defective or procedurally wrong in any way, this can lead to the winding up order being struck out. If the petitioner has tried to prepare the document without legal advice, it can often have procedural errors in it. Equally, if the winding up petition is not served correctly in accordance with the winding up petition company law rules, then this too can lead to the winding up petition being dismissed. Proper adherence to the winding up procedure is vital. Failure to do so can lead to winding up petition dismissal.

Francis Wilks & Jones is the UK’s leading firm of winding up petition solicitors. We are experts in what we do and can help you defend a winding up petition. Our knowledge of the winding up petitions is first rate and our results excellent. Whatever your winding up petition enquiry, we can assist. Call now for a friendly winding up petition consultation.

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