When Can a Creditor Take My Business To Court?
A creditor has the right to take your business to court for an involuntary formal insolvency procedure, which in most cases follows on to bankruptcy. This may only occur if your business owes a debt of £750 or more and only after you’ve been served with a statutory payment demand (of which the company has failed to comply with across a period of 3 weeks).
Bankruptcy Filings and Insolvency Procedures
In most cases, the main aim of insolvency is to safeguard and augment the best interests of your creditors. Nevertheless, there are a number of boundaries to this rule as some proceedings may abolish the need to reimburse certain debts. A creditor can also legally dispute a bankruptcy claim and they have the legal right to be heard in any such filing. What’s more, their presence does not have to be made at the 1st bankruptcy hearing to be able to challenge a claim.
Keeping the Pressure at Bay
The most effective way of alleviating creditor pressure is to agree on a repayment method that is mutually satisfying and beneficial to both parties. This will provide extra time and some much needed leniency whilst you pledge that the debt will be paid. If you are unable to come to such an agreement then it is highly recommended you seek the services of a licensed and professional Insolvency Practitioner.
Here at Clarke Bell we can help you create and propose realistic repayment plan that will be passed on to your creditors. We will work closely alongside both parties to ensure a satisfactory resolution is created for both parties.