One of the partners contacted Sarah Massey of KSA to discuss the company’s present financial situation. Then, after a subsequent telephone conversation with KSA regional manager Hugh Gabriel, a meeting was requested and held at the company’s premises. The business operates within the hospitality sector. Turnover for the year to 2010, was c£180K.
KSA were appointed to assist the company with a Partnership Voluntary Arrangement (PVA) in May 2012.
In a partnership the individual partners are inextricably linked. Under the partnership insolvency rules, each partner’s affairs can affect the other partner’s individual solvency issues and likewise the success or failure of the partnership. So for instance if one single partner entered into insolvency proceedings, this can bring down the partnership and possibly lead the individuals, that make up the partnership, into bankruptcy as well.
In A PVA, it may be necessary for the partners to propose Simultaneous (or interlocking) Individual Voluntary Arrangements (SIMIVA).
The business was encountering financial difficulties due to:
- Being unable to pay creditors as and when payments fell due.
- The receipt of a county court summons
- The business premises were subject to mortgage with c20 years remaining
- The business employs staff, however the number employed was not disclosed
- KSA was not made aware of any redundancies to be made however this is something that KSA frequently assists clients with.
Bank & Financial facilities
- The bank provided no overdraft facility.
- The bank did provide the property mortgage.
- KSA was made aware of no other financial facilities
- KSA was not made aware of the existence of an Overdrawn Current Account.
Unsecured Creditor debt:
- KSA was provided with no evidence of the unsecured debt owed by the business however it is believed this was c£40K of which HMRC was 80%
KSA resigned from this case in June 2012. This was due to the partners not fulfilling their agreement to provide all the necessary information in the agreed timescales.
Categories: CVA, What is a CVA or Company voluntary arrangement?