Transaction at Undervalue Solicitors

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What are My Business’ Reviewable Transactions?

Transactions at undervalue, also known as reviewable transactions, are those that liquidators, administrators, or creditors can challenge if a company becomes insolvent. These transactions may be deemed unfair or fraudulent, and their reversal can have far-reaching consequences.

They include:

• Preference: A transaction where a company gives preferential treatment to a creditor, often a related party or a creditor with a close relationship, to the detriment of other creditors. A preference occurs when a company gives a creditor a material advantage within six months of insolvency.
• Undervalue: A transaction where a company sells assets or provides services for less than their fair market value.
• Fraudulent Transaction: A transaction that is intended to defraud creditors or put assets beyond their reach, by delaying, hindering, or defeating creditors in recovering their debts.

How We Can Help

Our experienced insolvency solicitors specialise in identifying, assessing, and addressing reviewable transactions, safeguarding your company's financial health and protecting your interests.

We offer a comprehensive range of services, including:

• Thorough review and analysis of your company's transactions to identify potential reviewable activities.
• Expert legal advice on the implications of reviewable transactions and the available remedies.
• Strategic guidance on how to mitigate risks and avoid future reviewable transactions.
• Representation in insolvency proceedings to protect your company's assets and interests.
• Dispute resolution to resolve conflicts related to reviewable transactions and minimise their impact on your business.

Common types of reviewable transactions we handle include:

• Preferences: Payments or transfers made to certain creditors to the detriment of others.
• Transactions at an undervalue: Selling assets or providing services below market value.
• Transactions defrauding creditors: Actions taken to hide or transfer assets to avoid creditor claims.
• Misfeasance and breach of statutory duty: Director misconduct or failure to comply with legal obligations.
• Consequences of Transactions at Undervalue

If transactions at undervalue are discovered, a director could face significant consequences. The Insolvency Service may investigate the director's actions and potentially bring legal proceedings against them.

Potential consequences for the director include:

• Disqualification: The director could be disqualified from acting as a company director for 2-15 years, limiting their ability to participate in business management.
• Personal Liability: The director may be held personally liable for some or all of the company's debts, requiring them to repay the funds that were transferred.
• Fines: The director could be subject to substantial fines as a penalty for their actions.
• Criminal Prosecution: In cases of serious misconduct, the director may face criminal prosecution and potentially a prison sentence.

Company directors need to act with integrity and avoid engaging in transactions that could harm the company's creditors. But, if you find yourself caught up in allegations, contact our team today.

What You Need to Know

We're committed to providing clear and upfront information about our fees and the legal process, so you can make informed decisions about your case.

Fee Structures

We understand that legal matters can be complex and stressful, and we want to ensure that the financial aspect is as straightforward as possible. That's why we offer a variety of fee structures to accommodate different circumstances and budgets.

• Fixed Fees: For certain types of cases, we can provide a fixed fee estimate, giving you a clear understanding of the total cost upfront.
• Hourly Rates: In other cases, we may charge an hourly rate, allowing for flexibility as the case progresses.
• Contingency Fees: For eligible cases, we may offer a contingency fee arrangement, where you only pay a fee if we successfully recover compensation for you.

Potential Additional Costs and Funding Options

While we strive to minimise costs, there may be additional expenses that arise during the legal process. These can include:

• Court fees
• Expert witness fees
• Disbursements (e.g., court fees, barrister costs)

We will discuss these potential costs with you upfront and explore options to help you manage them effectively.

Additionally, we can discuss various funding options, including:

• Insurance: Check your insurance policies to see if they offer legal expense coverage.
• Payment Plans: We may be able to arrange flexible payment plans to suit your financial situation.

Your Possible Timeline

The timeline for a reviewable transaction case can vary significantly depending on the specific circumstances of the case, the complexity of the legal issues involved, and the workload of the courts. The following is a general overview of potential timelines and should not be considered legal advice. It is essential to consult with us for a more accurate assessment of your particular case.

An Example Timeframe

1. Initial Consultation and Case Assessment: Typically within a few weeks.

• • • A solicitor will assess the merits of the case, gather relevant documents, and advise on potential legal strategies.

2. Issuing the Claim: Can range from a few weeks to several months, depending on the complexity of the case and the availability of court dates.

• • • The solicitor will file the claim with the court, serving a copy on the defendant.

3. Response and Defence: Usually within a specified period, typically a few weeks or months.

• • • The defendant will have an opportunity to respond to the claim and present their defence.

4. Discovery and Disclosure: This can take several months or even longer, depending on the amount of evidence involved.

• • • Both parties may exchange documents, interrogatories, and other evidence relevant to the case.

5. Mediation or Negotiation: Varies widely, but can often be completed within a few months.

• • • Parties may attempt to resolve the dispute through mediation or negotiation before proceeding to trial.

6. Trial: This can take several days or weeks, depending on the complexity of the case and the availability of court time.

• • • The case will be heard by a judge or jury, who will decide the outcome.

7. Judgment and Appeal: If a party is dissatisfied with the judgment, they may have the right to appeal. The appeal process can take several months or even years.

• • • The appeal will be heard by a higher court, which may uphold, reverse, or modify the original judgment.

Why Choose Us

With our expert solicitors, you will experience the following benefits:

• • • Deep-Rooted Expertise: Benefit from our team's collective experience of over a century in insolvency law.
    • Industry-Leading Representation: Our commercial litigation specialists are highly regarded by the Legal 500, ensuring you receive top-tier guidance.
    • Plain-English Legal Advice: We communicate in clear and concise terms, avoiding confusing jargon.
    • Alternative Dispute Resolution: We explore ADR options when appropriate to help you resolve disputes efficiently and cost-effectively.
    • Tailored Solutions: Our strategies are designed to align with your specific business goals and objectives.
    • No-Obligation Consultation: Schedule a free initial consultation to discuss your needs.
    • Convenient Locations: We have offices in Birmingham, London, and Northampton for your convenience.

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