The Department for the Economy (the Department) has accepted a disqualification undertaking from the director of a company providing freight transport by road.
The undertaking was received for six years from Martin James Connolly (48) of Mount Eagles Park, Dunmurry in respect of his conduct as a director of 365 NI Group Ltd (“the company”).
The Company carried out freight transport by road trading from 41 Mount Eagles Park, Dunmurry, Belfast, BT17 0GU. The Company went into Administration on 29 November 2018 followed by Liquidation on 25 November 2020, with an estimated deficiency as regards creditors of £449,883. There was a total of £1.00 owing as Share Capital, resulting in an estimated deficiency as regards members of £449,884.
The Department accepted the disqualification undertaking from Martin James Connolly on 10th October 2022 based on the following unfit conduct which solely for the purposes of the disqualification procedure was not disputed:
- Causing and permitting the Company to operate a policy of discrimination against the Crown from 2015/16. Causing and permitting the Company to retain a total of £253,546.64 due to the Crown as at the date of liquidation. This represented 56% of the Company’s overall revised estimated deficiency in respect of PAYE/NIC and VAT properly payable to the Crown. Furthermore, operating a policy of discrimination in that from the review of company bank statements in the period 1 May 2017 through to 29 November 2018 of the £5,982,640.20 payments from the bank, a total of £948.00 was paid to HMRC. The payment to HMRC totalling £948.00 represents approximately 0.016% of all known payments made. However, when this is compared to the debt owing to HMRC, the amount retained from HMRC in the same period from 01 May 2017 to 29 November 2018 totals £166,162.33. The payments to HMRC, totalling £948.00, represent approximately 0.6% of the retained sum owed by 365 Group NI Ltd;
- Acting in contravention to Article 199 of The Insolvency (Northern Ireland) Order 1989. As a result, the administrator / liquidator has been unable to;
- Obtain sufficient background information into the affairs of the Company;
- Establish the true deficiency of the Company;
- Account for the sale of car stock to 365 Car & Commercial Limited
- Causing and permitting the Company to fail to comply with the Companies Act 2006 in that the annual accounts for the years ending 31 August 2017 and 31 August 2016 were not filed within the prescribed periods; and
- Causing and permitting the Company to fail to comply with the Companies Act 2006 in that the confirmation statement for the years to 16 August 2018 and 16 August 2016 were not filed within the prescribed periods.
The Department has accepted six Disqualification Undertakings in the financial year commencing 1 April 2022.
Notes to editors:
- Insolvency Practitioners acting as voluntary liquidators, administrative receivers and administrators have a duty to report unfit conduct to the Insolvency Service within the Department for the Economy.
- 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.
- 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.
- 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.
- 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.
- 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 548582.
- The period of disqualification commences at the end of 21 days beginning with the day the Disqualification Undertaking was accepted by the Department.
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