O’Reilly Stewart recently published clarification in respect of the recent Corporate Insolvency & Governance Bill which lately came into effect in Northern Ireland. This was introduced by the government in order to relieve the burden on businesses and to assist with economic recovery during the COVID-19 pandemic. In summary, the Bill makes permanent and temporary changes to Insolvency and Company law in Northern Ireland.
The most recent clarification of the Bill is that it simply refers to the use of Statutory Demands and Winding Up Petitions generally, and as such appears to impose restrictions only in respect of Corporate Insolvency, meaning it appears that Creditors could still issue Statutory Demands and Bankruptcy Petitions against individuals (Subject to the ongoing position with the Courts).
Going further, the Bill does not comment of the stopping of service of Statutory Demands against companies, and that simply you cannot file a Winding Up Petition based on a demand served between 1 March and 30 September 2020. However, the legislation appears to permit Creditors to so proceed if it can be shown that it had reasonable grounds for believing:
(a) coronavirus has not had a financial effect on the company, or
(b) the facts by reference to which the relevant ground applies would have arisen even if coronavirus had not had a financial effect on the company.
It appears that Creditors can proceed with service of demands and petitions against companies relying on the creditor’s reasonable belief on either of the above grounds. This however is caveated with the most up to date High Court’s Directions as the Bankruptcy Masters position.
If you are owned money by either a Company or an Individual contact our Insolvency Team on 02890 321000, whom will guide you though the latest procedures that must be followed.