Forensic work reduces director's disqualification period

How working in partnership with a local law firm helped minimise impact of a director's disqualification.

The situation

Jack Smith (not his real name) was chairman and majority shareholder of the family company. Cheap imports and technological change had rendered the company unviable and he called in the liquidators. To his amazement, months later, Jock got a letter from a government department saying his conduct as a director had been unsatisfactory and he would be disqualified from acting as a director. Jack's solicitor recommended talking to Mark Riley, an insolvency practitioner experienced in forensic examinations and head of Atherton Bailey's Guildford office.

What we did

Mark began a forensic examination of the circumstances surrounding the allegations while the solicitor concentrated on the legal issues. Mark quickly established some of the allegations were not supported by the evidence. He found other allegations were only supported by evidence from the other directors. Mark suspected the other directors were trying to avoid disqualification by heaping blame on Jack for the business's failings.

Together Mark and the solicitor boiled the case down to a few key allegations. However, the Department for Business, Enterprise and Regulatory Reform (BERR) still had sufficient evidence to push for Jack's disqualification as a director. So faced with a lengthy trial and substantial costs if he lost, Jack accepted a modest period of disqualification. But with Mark's report and the work of the legal team, BERR's public statement was as nominal as possible.

The result

During his reduced disqualification period, Jack worked successfully as a consultant and launched a new company the day his disqualification period expired.