Receiving a winding up petition can be a very frightening experience. With our team you will be in safe hands. We have dealt with 100's of petitions over the years and successfully resolved many of them to the benefit of our clients. Let our team help you today.
A winding up petition is a legal claim brought by a creditor of the company (usually) who has not been paid their outstanding debt. They will apply to the court to wind up the company so that the company’s assets can be used to pay creditors.
What happens once a winding up petition is served on me?
If you have received a winding up petition, then this will have already been issued in court by your creditor. The court will have provided a date for the hearing of the winding up petition, which will be detailed in the petition that you received.
- the winding up petition will be advertised in the London Gazette, although this will not happen until at least 7 business days after you have been served with it;
- the advertisement of the winding up petition can have devastating consequences a company including
- the bank putting a freeze on the company bank account
- suppliers and customers being on notice that the company may be wound up and therefore not supplying you with goods / services or buying form you.
What can I do?
If you agree that the debt is due then we would strongly advise paying the debt or reaching some sort of settlement as soon as possible after you have received the winding up petition and certainly before the creditor has an opportunity to advertise it in the London Gazette. This gives you 7 days from service.
- if you genuinely dispute the debt, then it is possible to make an application to court to prevent the advertisement of the winding up petition;
- you will have to act fast to do this;
- this would have to be on grounds that the debt is disputed and all evidence that you have that you have already notified to the creditor that this is disputed should be put forward. If you agree at least £10,000 of the debt however, a creditor can still get a winding up order for that part of the debt. This is an improvement on the previous rules where the limit was only £750.
If you wish to apply to restrain the advertisement of the petition, then you should take expert legal advice. The evidence must be presented in the best possible light and as quickly as possible. Our team of expert company liquidation lawyers at Francis Wilks & Jones can help.
We can also apply to court for a validation order to help you keep trading whilst you resolve the winding up order. This will lessen the risk of any later personal claims against the directors if the company is wound up.
Whatever you decide to do, it is imperative that you act quickly and that you take the correct expert legal advice as soon as you receive a winding up petition. If you don’t deal with the petition, then this can have serious consequences for your company very quickly. Contact our team today to discuss where we can help you.