County Armagh director disqualified

The High Court has made a disqualification Order against the director of a company involved in mixed farming.

County Antrim director disqualification undertaking.

The Order was made for 13 years against Ellie McClelland (30) of Knockbane Road, Middletown, Co. Armagh, in respect of her conduct as director of EM Farms Ltd (“the Company”).

The Company was involved in mixed farming with a registered office at 9 The Diamond, Middletown, Co. Armagh, BT60 4JE. The Company was dissolved on 22 June 2021 with an estimated deficiency as regards creditors of £50,549.86. There was a total of £1 owing as Share Capital, resulting in an estimated deficiency as regards members of £50,550.86.

The Court made the Disqualification Order against Ellie McClelland on 17 October 2024 based on the following unfit conduct which solely for the purposes of the disqualification procedure were not disputed:

1. Applying for and obtaining a Bounce Back Loan of £50,000 when she knew or ought to have known that EM Farms Ltd did not meet the eligibility criteria, as the Company was not trading on 01 March 2020. She also applied for the maximum loan available of £50,000 notwithstanding the fact that the Company had no turnover from incorporation;
2. Causing and/or permitting the misapplication of company funds and/or acting in a manner to benefit herself rather than the Company by using the full amount of the £50,000 received in respect of the Bounce Back Loan for her own personal benefit; and
3. Failing to co-operate with the Department. She has not provided a response to the questions put to her in relation to how the Bounce Back Loan was utilised.  She has acted in contravention to Article 10(5A) of the Company Directors Disqualification (Northern Ireland) Order 2002.

The Department has accepted fifteen Disqualification Undertakings and the Court has made four Disqualification Orders in the financial year commencing 1 April 2024.

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 for the Economy.
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 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 548587.
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 the Department for the Economy Press Office at pressoffice@economy-ni.gov.uk
9. The Executive Information Service operates an out of hours service for media enquiries only between 1800hrs and 0800hrs Monday to Friday and at weekends and public holidays. The duty press officer can be contacted on 028 9037 8110.
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