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Old 05-Jul-2005, 14:27
revdecal revdecal is offline
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Any legal bod\'s on here?
my next door neighbour has just gone bust as a Ltd company.

He does not want to liquidate in order to honour his debts.

the landlord,however, has just told him that as he signed a contract 'mr x trading as x ltd' he can hold him personally liable.

Any help would be appreciated, we are trading fine as a company but we have signed the same agreement so it would be interesting to know (just in case)
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Old 05-Jul-2005, 14:42
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If you are trading as a sole trader or a business that's not LTD you and your business are treated as one. This means if you have problems with the business you are personally liable for any debts the business incurs. This can put your house and any personal assets you might have at risk.

If you have a Limited company you are limiting your personal liabilities. A Limited Company is a legal entity in it's own right. You are not personally liable for the company's debts, as long as you have traded legally or you have not given personal guarantees regarding contracts or suppliers etc. If things go wrong the creditors are paid out of the company's assets not from your own personal assets. Also once you have chosen and registered your company name no other company can use the same name, unlike business where names can be duplicated.

From: http://www.uk-business-formations.co.uk/
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Old 05-Jul-2005, 15:01
revdecal revdecal is offline
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thats exactly why we mostly go Lts, to protect our personal assets, but the landord is telling this company that he made a contact stating...Mr X trading AS X ltd to get around companies liquidating and leaving him in the lurch.

sounds fishy to me
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Old 05-Jul-2005, 15:12
guest1 guest1 is offline
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Who did the bills go to for the utilities?
If they were addressed to Ltd Co name then you have a better standing.

Also, what is the Tax angle on this? He's not a sole trader so is not classed as Mr X trading As X Ltd, so any contract he signed may well be judged inadmissable as he did not have authority to sign as Mr X trading as X Ltd?

Just my thoughts from 23 years as a contractor and Ltd co. Someone legal will no doubt be along to clean my windscreen though.
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Old 05-Jul-2005, 16:26
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"Trading As" has a legal meaning and is not the same as "Limited Company".

You cannot have "Mr X Trading As X Ltd" - these are two distinct and very different legal entities.
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