Monday, April 02, 2012

Companies House – it has finally happened! – the sequel!

In our Blog dated 16 February (http://complianceoncall.blogspot.co.uk/2012/02/companies-house-it-has-finally-happened.html) we briefly explored the problems and consequences of a delay in Companies House registering a notice of move from Administration to CVL on Form 2.34B, such that it was not registered until after the expiry of the Administration. Fortunately there has recently been another decided case on this very subject, and one which helps IPs enormously.

In the case of Cartwright v Registrar of Companies, Mr Justice Briggs held that Companies House should use the date it receives the Form 2.34B as being the date of the cessation of the Administration and the commencement of the CVL. In other words, the date of receipt of the Form 2.34B and the date of registration should be one and the same, rather than having the usual gap between receipt of a document by Companies House and its registration after processing.

Whilst this case will help ensure that there is no gap between an Administration and a CVL, you will still need to ensure that a properly and accurately completed Form 2.34B is received by Companies House before the automatic ending of the Administration. The advice in our original article remains, do not leave it until the last minute before submitting a Form 2.34B just in case there is a postage delay or if the form is rejected by Companies House. One thing that comes out of this judgement is that whilst Companies House has discretion to accept Forms that are technically deficient under section 1073(1) of the Companies Act 2006, it is their policy “to reject incomplete forms without considering whether their perceived omissions could be ignored as a matter of discretion.” So be warned, and make sure that Forms are always properly and fully completed.

The full judgement can be found at http://www.innertemplelibrary.com/2012/03/cartwright-and-another-v-registrar-of-companies-wlr-daily/. It makes interesting reading, particularly the reasons for the rejection of the Form 2.34B, twice, by Companies House, and the analysis of the consequences of having a gap between the ending of the Administration and the commencement of the CVL and how that can adversely affect a liquidator.

Finally, we have heard, but have not managed to verify it ourselves, that Companies House are looking at the date of registration of Form 2.34Bs on cases and are retrospectively amending the dates on the Register as to the date of cessation of Administrations and of commencement of CVLs to the date they received the Form 2.34B. We do not know how far back Companies House are going, but the case was heard on 16 February 2012, so presumably they are only looking at Form 2.34Bs received and registered by them after that date. I think that it would be worth checking any cases where you have sent a Form 2.34B since, say 1 February 2012, in order to see if Companies House have indeed amended the date shown on the Register as to when the Administration ceased and the CVL commenced. If they have, then you will have to take various remedial steps, including updating your case management system, notifying your bond providers, re-gazetting the notice of appointment as liquidator, and notifying creditors of the correct date you ceased to act as Administrator and were appointment liquidator.