Britannia Lift Limited went into creditors' voluntary liquidation on
Limited companies are separate legal entities from those who own and manage them. Those who deal with such companies are not contractually engaged with the individual directors, who will be liable only if, for example, they have given personal guarantees. However, when a company fails, the insolvency law provides a variety of measures to deal with those who abuse the privileges of limited liability.
When a company goes into administration, insolvent liquidation or administrative receivership, the responsible insolvency practitioner or official receiver has a duty under the Company Directors Disqualification Act 1986 to report to my right hon. Friend the Secretary of State if he/she forms a view that the conduct of any of the directors makes them unfit to be concerned in the management of a company. My right hon. Friend the Secretary of State then has a discretionary power to seek the director's disqualification, where he believes it to be in the public interest. In deciding whether or not there has been unfitness, all the circumstances of the case are taken into account including matters specifically referred to in Schedule 1 of the Company Directors Disqualification Act 1986. A disqualification can run for between two and fifteen years and contravention can result not only in criminal sanctions but also in the director becoming personally liable for the debts of any new company.
If the hon. Member and/or his constituents have any reason to believe that the conduct of the directors of Britannia Lift Limited is such as to amount to justify the bringing of disqualification proceedings, they should make those concerns known to the liquidator so that he can take them into account when reporting to my right hon. Friend the Secretary of State.