Restorations by court order

When a company has been dissolved, there can be circumstances where there is a reason to restore the company to the register.

Administrative restoration

It is often the case that a formal court application is required to apply for the company’s restoration. This requirement occurs if administrative restoration is not an option under section 1024 of the Companies Act 2006, where strict criteria is set. You can only proceed with administrative restoration if:

• You were a director or shareholder
• The company was struck off the register and dissolved by the Registrar of Companies within the last six years
• The company was trading at the time it was dissolved

When a court application is required

If the above does not apply, a court application is necessary including cases where the directors of the company applied for voluntary strike off.

There are a number of reasons why the restoration of a company is necessary, including but not limited to:

• Former directors or shareholders, where for, example:
  • Funds remain in the company’s bank account
  • There is an intention to reinstate the company’s trading potential.
• Creditors or persons who did business with the company including:
  • Creditors of the company at the time of dissolution who wish to recover debts – the company needs to be restored before proceedings can be issued
  • Any other person who may have a potential claim against the company
  • Persons who have a shared or competing interest in the property or land which the company owns or holds an interest in.
• Former employees who had a claim against the company at the point of dissolution
• Persons responsible for the employee pension fund
• Any other person or entity who the court agrees has a reasonable interest in the matter.

Process

The court application needs to be supported with a witness statement dealing with the reasons why the restoration is sought.

Once the proceedings have been issued, the applicant is required to liaise with the Registrar of Companies and the Treasury Solicitor ahead of the court hearing as they need to be satisfied all the requirements have been met and the relevant undertakings, which vary on a case-by-case basis, will be given. The court order is then sought assuming all the requirements have been dealt with.

How we can help and key insights for businesses

The court process usually takes around four months, and we can assist you with:

• Preparing the application and evidence in support
• Liaising with the Registrar of Companies and Treasury Solicitor
• Preparing for and attending the court hearing
• Liaising with banks and other parties as required under the process.

Companies which are trading are often dissolved as a result of a failure to file statutory documents, such as accounts of confirmation statements. This will inevitably cause significant disruption as the company will in effect no longer exist and its assets will revert to the bona vacantia division of the Crown Estate, being effectively frozen.

Whilst these oversights are more common than one would think, it is obviously pivotal to bring restoration proceedings as expeditiously as possible.