County Down director agrees to disqualification

Date published: 07 July 2021

The Department for the Economy (the Department) has accepted a disqualification undertaking from the director of a furniture sales company.

Director disqualification undertaking
Director disqualification undertaking

The undertaking was received for four years from James Joseph Lynch (54) of The Woodlands, Warrenpoint, Newry, in respect of his conduct as the director of World of Furniture (NI) Limited (“the Company”).

The Company operated in the sale of household furniture, trading from stores at Bow Street Mall, Lisburn; Cityside Shopping & Leisure Park, Belfast; Shane Retail Park, Belfast; Crescent Link Retail Park, Londonderry; West Bank Road, Belfast and Valley Retail Park, Newtownabbey. The Company went into Liquidation on 26 January 2017 with an estimated deficiency as regards creditors of £884,488. There was a total of £3 owing as Share Capital, resulting in an estimated deficiency as regards members of £884,491.

The Department accepted the disqualification undertaking from James Joseph Lynch on 15 June 2021 based on the following unfit conduct which solely for the purposes of the disqualification procedure was not disputed:

  • Failing to ensure Annual Accounts for the year ended 31 March 2016 were filed with Companies House within the prescribed period required by the Companies Act 2006;
  • Failing to co-operate with the Official Receiver in that he did not submit a Preliminary Examination Questionnaire despite several requests.

The Department has accepted 10 Disqualification Undertakings in the financial year commencing 1 April 2021.

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 548582.
  7. 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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  10. 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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