Inverness directors banned for making or arranging payments to connected parties from a company unable to pay its debts and for improper disposal of assets
Gary MacDonald and Colin Thomson, directors of civil engineering contractors Highland Quality Construction Ltd (“HQC”), have been disqualified from acting as company directors for eight years and six years respectively, for their responsibility over payments made to connected companies at a time when HQC was unable to pay its debts and disposing of assets belonging to a finance company without that company’s consent.
Following an investigation by the Insolvency Service, Mr MacDonald (45) and Mr Thomson (39) gave undertakings to the Secretary of State for Business, Innovation and Skills not to act as directors, manage, or in any way control a company from 20 May 2014 until 19 May 2022 and 19 May 2020 respectively.
Joanne Covell, a Head of Investigations, at the Insolvency Service, said:
“Company directors are required to act in the best interests of the company.
“At a time when a company is insolvent and not paying its debts when due, the directors also have a duty to act in the best interests of the creditors. This is to ensure that creditors are treated fairly and in a transparent manner. Company assets should be handled in an appropriate manner, taking account of ownership and seeking to minimise potential losses to creditors.
“Directors that breach their duties will find themselves investigated by the Insolvency Service and could face a lengthy ban.”
In relation to Mr MacDonald, the investigation found that despite a charge for payment having been served on HQC and remaining unpaid, payments totalling £520,857 were paid to connected parties. Additionally, seven items of HQC’s plant and machinery which were subject to finance were sold and the proceeds diverted to an associated business. A further 10 items of equipment, belonging to a finance company, were disposed of without the consent of the finance company. These 10 items were sold for £486,000, resulting in a loss of that amount to the finance company.
In relation to Mr Thomson, the investigation found that despite a charge for payment having been served on HQC and remaining unpaid, payments totalling £520,857 were paid to connected parties. Additionally, 10 items of equipment, belonging to a finance company, were disposed of without the consent of the finance company. These 10 items were sold for £486,000 meaning that a loss of £486,000 was suffered by the finance company as a result.
Notes to Editors
Mr Macdonald is of Daviot, Invernesshire and his date of birth is 21 January 1969.
Mr Thomson is of Inverness, Invernesshire and his date of birth is 24 February 1975.
Highland Quality Construction Ltd, company number SC154147 was incorporated on 8 November 1994, the registered office being formerly at Clava House, Cradlehall Business Park, Inverness, IV25 5GH and most recently at 37 Albyn Place, Aberdeen, AB10 1J.
Highland Quality Construction Ltd entered Receivership on 2 June 2010 with estimated assets of £467,490 and estimated liabilities of £9,587,495, leaving an estimated deficiency to creditors of £9,120,005.
The Insolvency Service administers the insolvency regime investigating all compulsory liquidations and individual insolvencies (bankruptcies) through the Official Receiver to establish why they became insolvent. The agency also authorises and regulates the insolvency profession; deals with disqualification of directors in corporate failures; assesses and pays statutory entitlement to redundancy payments when an employer cannot or will not pay employees; provides banking and investment services for bankruptcy and liquidation estate funds; and advises ministers and other government departments on insolvency law and practice. Further information about the work of the Insolvency Service is available from https://www.gov.uk/government/organisations/insolvency-service
A disqualification order has the effect that without specific permission of a court, a person with a disqualification cannot;
Disqualification undertakings are the administrative equivalent of a disqualification order but do not involve court proceedings.
Further information on director disqualifications and restrictions can be found at http://www.bis.gov.uk/insolvency/Companies/insolvent-companies/director-disqualification-and-other-action
Media enquiries only should be directed to: Kathryn Montague, Media & Campaigns Manager on 0207 674 6910 or Ade Daramy, Media Manager on 0207 596 6187.
- act as a director of a company;
- take part, directly or indirectly, in the promotion, formation or management of a company or limited liability partnership;
- act as an insolvency practitioner; or
- be a receiver of a company’s property.
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Ade Daramy Phone: 020 7596 6187
Kathryn Montague Phone: 0207 674 6910
Published: 26 June 2014
From: The Insolvency Service