News Item in The London News on the Bankruptcy Registry in the Royal Courts of Justice - a naughty picture?
"It's standing room only in the small, wood-panelled courtroom at the Royal Courts of Justice on the Strand. Be-wigged barristers, sharply suited solicitors and a number of anxious-looking individuals are here for the weekly winding-up session during which stricken companies are officially put out of business... or granted a brief stay of execution, giving their owners a chance to salvage them.
Ruling over the proceedings is Mr Registrar Simmonds, whose word, literally, is law. He is firm and businesslike but not without touches of humour. Perhaps he realises that in this grim arena, where people’s hopes and ambitions are routinely demolished, you need the odd lighter moment. Since the economic crisis set in, the number of companies hitting the buffers has risen sharply.
There were 4,607 liquidations in England and Wales between October and December 2008 – a 52 per cent increase on the same period a year ago, according to the Government’s Insolvency Service.
In 90 minutes, Simmonds pronounces the fate of 200 small companies of all kinds. Many will be wound up in seconds, uncontested.
But in other cases, business owners (or their barristers) will plead for more time to raise money and pay creditors. Three such business owners spoke to thelondonpaper about their desperate plight and the circumstances which brought them to it.
‘I HAVEN’T HAD A GOOD NIGHT’S SLEEP FOR WEEKS’
Lydia, 30 (not her real name)
Company: A business importing goods from Eastern Europe, with five retail outlets in London.
How long going for: Six years.
What went wrong: The landlord of the warehouse formerly used by Lydia’s company is suing her for £25,000 in unpaid rent. She claims she owes just £1,800 because the rest is covered by her deposit, but the landlord says it has already been allocated to repairs.
Grievances: “I feel landlords in this country are allowed to get away with too much. We couldn’t agree over the deposit, so he goes straight to the court with a petition. As a result I have £20,000 to pay in lawyers’ fees.”
Impact on life: “I’ve been paying my employees’ wages from my private account, because I don’t want to lose them, but they don’t know about the situation – I worry they will find out and quit.”
The court’s ruling: Lydia is given 14 days to submit evidence supporting her claim that she should be repaid the deposit.
What next? “If the court rejects my evidence, my business will go into liquidation.”
‘BANKS TAKE THE BROLLY BACK WHEN IT RAINS’
Robbie Sani, 42
Company: Kimblecrete Ltd, a provider of temporary B&B accommodation for the homeless, with four properties in Finsbury Park.
How long going for: 24 years.
What went wrong: New government regulations required extensive work to be carried out on the company’s premises, during which time revenues took a dive. The bank refused to help, and the builder absconded with £80,000.