Claims by a liquidator for monies to be repaid to a company now in liquidation are unfortunately for most businesses a common event. The good deeds done in collecting money can come undone and hurt your bottom line.
As a successful credit management team, you will have recovered monies that may have been received shortly before the debtor company was placed into liquidation, or the individual declared bankrupt. This can then bring a new raft of issues should the liquidator or trustee be savvy enough to want the money back.
The reasoning behind the recovery of monies by a liquidator is to ensure that in the final days and months of a company prior to liquidation, monies paid by the company are paid equally to all of its creditors and that none are preferred over others. Similar provisions apply in a bankruptcy matter.
Whilst this seems fair on its face, it does not assist those businesses that are diligent and actively take steps to ensure that their customers comply with the terms upon which they agree to abide by in receiving the goods and services provided.
The law surrounding collecting money by a liquidator or trustee is complex and has a lengthy history of battles before the courts. It involves the interaction between the Corporations and Bankruptcy Acts, as well as case law and relatively new PPSA legislation. Whilst on the face of it a claim may seem straightforward, the facts behind the words and numbers can give rise to a defence to the claim that can defeat a claim in whole or at least in part.
At Matthews Folbigg we can assist you on the defence to a claim from a liquidator which can start from the content of your terms and conditions of trade. The status of the goods supplied or the terms of supply can dictate whether title in the goods is released upon sale or withheld by the seller until payment.
The Courts have made various decisions in favour of a supplier of goods that allows it to retain monies received, despite claims by the liquidator. We can help you explore those options and protect your interests.
At Matthews Folbigg we can provide you with the necessary assistance so that you can manage your ledger efficiently and recover the monies due and owing, and have the best chance of keeping the monies you recover.