We are helping an insolvency litigation financing company bring a claim against a sole director of a restaurant and Shisha bar. The restaurant was investigated for suspected suppression of sales as its bank accounts showed no cash had been banked for a long period. Following an HMRC assessment, the restaurant was charged corporation tax and VAT totalling over £300,000. HMRC also considered that suppressed sales (of over £4 million) should be allocated to the sole director’s loan account.
The restaurant went into creditors’ voluntary liquidation in December 2017. With no assets in the estate, the liquidators assigned the claim to the insolvency litigation financing company. The company issued proceedings in May 2019 and obtained judgment in default of an acknowledgement of service in June 2019. The defendant (sole director) applied to set aside the judgement and his application was heard by Deputy Master Nurse in November 2019. This, and a later appeal by the defendant in January 2020, was refused. The insolvency litigation financing company has the benefit of a charge over the defendant’s unencumbered property.