A supplier has gone out of business...help!
littlemissme
Registered Posts: 21 Dedicated contributor 🦉
Hi Guys,
I am new to this forum so any help would be very much appreciated.
I have paid one of our supplier a total of around £2K (paid in advance of the date of the service as per our agreed payment terms) and now they have gone out of business without providing the service I've paid for. I have tried contacting them but they said they have now closed their bank account and have no money to pay us. The reason why they've shut down was because the owner has a terminal illness. Is there any way that I can get our money back?
Thanks!
I am new to this forum so any help would be very much appreciated.
I have paid one of our supplier a total of around £2K (paid in advance of the date of the service as per our agreed payment terms) and now they have gone out of business without providing the service I've paid for. I have tried contacting them but they said they have now closed their bank account and have no money to pay us. The reason why they've shut down was because the owner has a terminal illness. Is there any way that I can get our money back?
Thanks!
0
Comments
-
Probably not (sorry).
Was the supplier a limited company? If it was, PM me the name/ registered number and I will have a look for you.
If it was an individual, then you could sue him, but if he's terminally ill, that's a bit mean!0 -
I agree with Monsoon, the chances of seeing your cash back are unlikely. However, just a few curious questions:
1) Was this a reputable company with a long trading history or a fly by night firm? Just be careful you're not having the wool pulled over your eyes if it's the latter...
2) As per Monsoon, was this a limited company or sole trader?
3) How long was it between you paying the cash over and then expecting delivery of the service?
If it's a limited company you can join the back of the queue as far as creditors go but you'd be unlikely to see any return on your time, effort and extra money. And as Monsoon said, it's morally bankrupt to sue a terminally ill person: we wrote off one of our own sole trader debts for €21,000 just a few months ago as the guy had spent all his cash on life saving treatment on the understanding that anyone in his position would have done the same...
Harsh but you'll learn lessons from this, I'm sure...0 -
It's a Limited Company and I've just done basic Due diligence on it for her.
They were solvent at the last accounts (april 2011)
As I said in my PM, it's worth chasing as the company may have assets and he who shouts loudest tends to have more success in these cases (it all depends on the advice given to the company as to how they proceed).
By all means keep chasing, but I wouldn't throw any money on recovery action.0 -
With respect, the guy's terminally ill. There's no ethical credit control process for death!
From a purely humanitarian point of view, would you be comfortable with chasing money out of a guy who's going to die? I certainly wouldn't. This is an extraordinary situation and you don't want to provoke an extraordinary response from his family if you get my point?
It's not a great amount of business money in most people's eyes... leave it. If it's not terminal and he eventually gets better, you could perhaps consider it again in the future but I'd still say leave it and write it off to experience. Your or your bosses need to take a pragmatic point of view. Taking an unsavoury course of action could hurt your own business in the future: ethical clients might even refuse to deal with you if word got out and your own business could suffer as a result.0 -
I should have said that one director left the business 1 month ago, and I presumed that he was the dying one. The OP has now told me it's the remaining director who is ill. In which case, absolutely no point in chasing, and yes, unethical to do so.0
-
Hi Robert and Monsoon,
Thank you for your help in this.
I understand it's not right to chase someone because of the situation, that's the first thing that I said to them that it's not proper and it's just a small amount and not worth the time and effort and that we only have to accept the fact that we'll lose the money and we just need to learn from it, expensive way to learn something but we haven't got a choice and it's unintentional.
I think what I was trying to achieve was to learn the procedure in this type of situation, when a supplier has gone out of business and you've paid them in advance.
Thanks!0
Categories
- All Categories
- 1.2K Books to buy and sell
- 2.3K General discussion
- 12.5K For AAT students
- 325 NEW! Qualifications 2022
- 160 General Qualifications 2022 discussion
- 11 AAT Level 2 Certificate in Accounting
- 56 AAT Level 3 Diploma in Accounting
- 95 AAT Level 4 Diploma in Professional Accounting
- 8.8K For accounting professionals
- 23 coronavirus (Covid-19)
- 273 VAT
- 92 Software
- 274 Tax
- 138 Bookkeeping
- 7.2K General accounting discussion
- 202 AAT member discussion
- 3.8K For everyone
- 38 AAT news and announcements
- 345 Feedback for AAT
- 2.8K Chat and off-topic discussion
- 582 Job postings
- 16 Who can benefit from AAT?
- 36 Where can AAT take me?
- 42 Getting started with AAT
- 26 Finding an AAT training provider
- 48 Distance learning and other ways to study AAT
- 25 Apprenticeships
- 66 AAT membership