Company Struck Off - are they able to bill you?

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semigeek

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#171335 14-Apr-2015 11:53

Quick question

If a company has been struck off the NZ company register, but the person who set that company up is still operating and still using the company name and company number, are they still able to send out invoices.

I can't go into the details on here of why or how, would just like some clarification on the above. Thanks

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#1282821 14-Apr-2015 12:00

I don't see any reason why not.

They'd be breaking various laws but that is between them and the authorities. Shouldn't affect any contract you have with the company though.

wasabi2k

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#1282826 14-Apr-2015 12:02

From Companies Office:

Struck off

This refers to a company that is no longer registered (that is, it has been removed from the register). For a company, this may result from

a failure to file annual returns,
the completion of liquidation,
from an amalgamation with another company or
from a formal request to be removed from the register.

The document filing history usually indicates why an entity has been struck off.

You can also relist after being struck off. So sorry can't give you a definitive answer. Have you looked them up on Companies Office and seen what info is there?

wasabi2k

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#1282828 14-Apr-2015 12:03

surfisup1000: I don't see any reason why not.
They'd be breaking various laws but that is between them and the authorities. Shouldn't affect any contract you have with the company though.

Pretty sure if the entity that you contracted with (company) is no longer incorporated then your contract is void.

But again it is unclear if that is the case or if they have been struck off for another reason.

semigeek

1606 posts

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#1282830 14-Apr-2015 12:07

wasabi2k: From Companies Office:
Struck off This refers to a company that is no longer registered (that is, it has been removed from the register). For a company, this may result from

a failure to file annual returns,
the completion of liquidation,
from an amalgamation with another company or
from a formal request to be removed from the register.

The document filing history usually indicates why an entity has been struck off.

You can also relist after being struck off. So sorry can't give you a definitive answer. Have you looked them up on Companies Office and seen what info is there?

Yep, looked them up, it doesn't say why they were struck off, just that they are struck off. And on here, I don't want to name the company or person(s) behind it.
Its not me that it involves either, asking on behalf of someone.

knoydart

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#1282834 14-Apr-2015 12:14

Maybe check with the Companies Office on 0508 266 726?

tdgeek

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#1282840 14-Apr-2015 12:18

If their trading name is not including "Ltd" or "Inc" then they would be legally operating as a business, but not a limited liability company. Such as a Sole Trader or Partnership.
Notwithstanding any legal rules for the individual(s) as regards being allowed to run a business right now, i.e. bankruptcy, fraud

surfisup1000

5288 posts

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#1282847 14-Apr-2015 12:25

Guess you need a lawyer who knows contract law /companies law with respect the the enforceability (that a word??) of contracts with invalid entities.

Call citizens advice, might get lucky and hit on someone who knows.

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mdf

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#1282929 14-Apr-2015 13:44

tdgeek: If their trading name is not including "Ltd" or "Inc" then they would be legally operating as a business, but not a limited liability company. Such as a Sole Trader or Partnership.
Notwithstanding any legal rules for the individual(s) as regards being allowed to run a business right now, i.e. bankruptcy, fraud

<-- This exactly. By and large, the status of an entity (company, partnership, trust, individual etc. and whether struck off, on the register or in liquidation) doesn't affect the validity of a contract. Companies get struck off all the time and are usually restored to the Register pretty quick smart if it's a stuff up.

But just adding that (from context) it appears that they are in fact using "Limited" (i.e. the former company name). You have to sit on the naughty step ($5,000 fine) if you try this - section 381 of the Companies Act.

Kiwifruta

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#1282938 14-Apr-2015 13:51

If they are struck off then they no longer exist. My company owed IRD a late filing fee, but since the company was struck off the companies register the IRD said the fee was no longer owed as the company no longer exists.

I do not know if a former shareholder of the stuck off company may have claim on a debtor though.

Best answered by a commercial lawyer.

semigeek

1606 posts

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#1282939 14-Apr-2015 13:54

Thanks all, I would like to be able to post more, but can't for reasons known to me.
But all information is great.

mattwnz

20141 posts

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#1282943 14-Apr-2015 14:01

You may need to ask them why they are trading under the name of a entity that no longer exists. It may just be a simple error on the invoice. One reason a company can be struck off is that they are sold to a another company.

Geektastic

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#1283026 14-Apr-2015 15:58

If the company is struck off, it no longer legally exists. Ergo, they cannot trade using the struck off company number or the struck off company name and commit an offence by so doing.

Since they are not a legal entity, they cannot issue invoices or enter into contracts.

Of course, they can alter the name in minor ways (for example, Joe Bloggs Ltd becomes Joe Bloggs (1981) Ltd) but if they re-register I would suggest it most unlikely that they would be given the old company number.

Best courses of action would be either a lawyer or the Companies Office.

dejadeadnz

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#1283146 14-Apr-2015 19:05

To the OP: Five free legal tips from a RL lawyer:

1. Much of the discussions/assertions about legal issues in this thread, like the rest of the internet, are plain wrong or worse, however well-meaning the interlocutors might be.

2. Have a read of s 356 of the Companies Act and see if you can understand its implications for you or whether you need further advice.

3. Even as someone who's legally qualified and has worked/remains working for reputable "top tier" entities, it's actually very hard to give black and white answers to most legal questions that are simplistically presented online without relevant facts and contexts, which are often either deliberately omitted or left out by people who think they know that the supposed side issues are irrelevant.

4. Whether one can LEGALLY avoid a debt is not the same as whether you SHOULD morally avoid a debt; in addition, NZ is a small place and a bad reputation might catch up to you.

5. If you want serious advice on serious issues, either pay for a lawyer or take advantage of the services of volunteering lawyers at CABs, Community Law Centres and so on.

Geektastic

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#1284593 15-Apr-2015 11:23

S15 of the Companies Act 1993 puts it clearly

"A company is a legal entity in its own right separate from its shareholders and continues in existence until it is removed from the New Zealand register."

S356 is part of Part 19 "Registration of Overseas Companies Under This Act".

I do agree a lawyer is the best option.

dejadeadnz

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#1285060 15-Apr-2015 19:51

Opps, yes I assumed this might be an overseas transfer situation, which may or may not be the case. Section 15 is not be a complete answer - just because a company is removed from the register, it doesn't mean someone who formerly procured service from it doesn't have a liability to SOMEONE/SOMEBODY. How do you know the company didn't assign (whether the assignment is valid or not is another matter) the debt prior to being struck off? In many cases, no one is obligated to tell you that a debt has been assigned. Whilst it's hardly good commercial practice for someone to be issuing demands/invoices in the name of a company that no longer exists, if there was a valid assignment of debt to another entity, this is unlikely to be defeated by virtue of that conduct.

Even worse, a struck off company can be restored to the register: s 329 gives the high court a discretion to restore a struck off company to the register and a restored company is deemed under s 330(2) to have never been removed from the register, i.e. its rights and obligations continue as though it was never removed. Has the OP checked there are no such proceedings?

These sorts of complexities are precisely why people shouldn't seek legal advice on the internet and legal neophytes, however well meaning, who try to help by quick glancing provisions in statute and pointing to them as "answers" end up encouraging this sort of approach. Unless you are talking about genuinely black and white stuff like "What's the maximum penalty for doing X?", go and get advice from a professional in a proper way.

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