When a company is struck off the Register of Companies and dissolved, all its assets (which remain in/owned by that Company) pass to the Crown and are known legally as ‘bona vacantia’, which translates to “ownerless property”. A company can be struck off the Register and dissolved either voluntarily, i.e. the company itself can make the application if, for example, it’s no longer needed, or involuntarily, for example, because the company has failed to comply with certain legal requirements, such as the failure to submit timely accounts.
A common scenario therefore arises when a former director or shareholder of a dissolved company wishes to restore a company to the Register of Companies in order to recover assets which were held by the company immediately prior to the time of its dissolution; for example to recover funds in a company bank account or to recover property held by that company.
Restoring a company
There are two methods available to restore a company to the Register of Companies;
- Administrative restoration and
- An application to the Court.
Administrative restoration is only available to former directors and shareholders of the dissolved company. Further, the company must have been trading at the time it was dissolved, and the company must have been dissolved within the last 6 years. If these conditions are not met, an application to the Court will have to be made. This article will deal with the process of administrative restoration, and will instead focus, in broad terms, on the process of applying to the Court for an order to restore a dissolved company to the Register of Companies.
The process is as follows:
- The first stage in the Court process involves sending a claim form, together with a supporting witness statement, to the nearest County Court to the company’s registered office that deals with bankruptcy. The witness statement should specify, amongst other things, the reasons why the claimant has the right to make the application, and confirmation of the reason for restoring the company to the register i.e. to recover money in a company bank account or to transfer a property registered in the name of the company.
- The Court will return a sealed copy of the claim form and witness statement to you and then these must be served on the Registrar of Companies and the Treasury Solicitor. The Treasury Solicitor will respond, hopefully to confirm that no objection will be raised by the Crown to the restoration of the company and setting out the requirements of the Registrar of Companies. The Treasury Solicitor will require a fee for the waiver letter confirming that no objection will be raised by the Crown, which is typically around £300.
- A further witness statement must then be sent to the Court, exhibiting the waiver letter received from the Treasury Solicitor.
- Once the Treasury Solicitor has received payment, he will then send a draft order for the restoration of the company, which is signed by both the Treasury Solicitor and the claimant (or their representative), and sent to the Court.
- If all is in order, the Court will then return a sealed copy of the Court order to you to forward on to the Registrar of Companies, who, upon receipt of the sealed order, will restore the company to the Register of Companies. Any company which is restored to the register is deemed to have continued in existence as if it had not been struck off and dissolved.
- To recover any company funds which may have passed to the Crown on dissolution, the Treasury Solicitor Bona Vacantia Division should be contacted.
- Although the Courts have adopted a practice of attempting where possible to deal with these cases by consent without a formal hearing, if the Court has any uncertainty during the process or requires further clarification, the Court will most likely list the matter for a formal hearing to consider matters further.
If you are a former director or shareholder of a dissolved company, and are looking to recover assets which were held by the company at the time of its dissolution, please do not hesitate to get in touch with Alex Medford, Solicitor within the Firm’s Dispute Resolution department, on 01543 431197 or email@example.com.