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Coleraine directors agree to disqualification

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The Department of Enterprise, Trade and Investment (the Department) has accepted disqualification undertakings for eight years and two years from the directors of a car sales business.

The undertakings came from from Liam Francis Rafferty (55) for eight years and Anne Rafferty (51) for two years both of Carhill Road, Garvagh, Coleraine in respect of their conduct as directors of Carhill Car Sales Limited (“the Company”).

The Company carried on the business of car sales from Carhill Road, Garvagh, Coleraine and went into liquidation on 30 October 2012 with estimated total assets available for creditors of £50,500, liabilities to preferential creditors of £4,441, liabilities to floating charge holders of £1,480,730, liabilities to unsecured creditors of £125,561 and an estimated deficiency as regards creditors of £1,560,232. After taking into account the losses incurred by members (the shareholders) of the Company the estimated total deficiency was £1,560,234.

The Department accepted the disqualification undertaking from Liam Francis Rafferty on 21 October 2015 based on the following unfit conduct which solely for the purposes of the disqualification procedure was not disputed:

  • Breaching his fiduciary duty to the Company in that he did not act in the best interest of the Company at a time when he knew or ought to have known that both the Company and a related company were insolvent. He caused and permitted the Company to make unsecured loans to this insolvent associate company for no commercial benefit, of which at least £750,444 remained unpaid at the date of liquidation.
  • Causing and permitting the Company to seriously misrepresent and overstate its vehicle stock valuations from 31 December 2011 to 31 May 2012; and from 31 July 2012 to 25 October 2012 in order to obtain and/or maintain an overdraft facility with the bank, to which it was not entitled, as the actual stock valuations were less than that required by the conditions of said overdraft facility.

The Department accepted the disqualification undertaking from Anne Rafferty on 21 October 2015 based on the following unfit conduct which solely for the purposes of the disqualification procedure was not disputed:

  • Failure to adequately address the affairs of the Company and allowing herself to be recorded as a director without undertaking the duties which such a position entails.

The Department has accepted 17 Disqualification Undertakings and the Court has made six orders disqualifying directors in the financial year commencing
1 April 2015.

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