Two directors of an engineering contracting company have been disqualified from acting as company directors for a total of 14 years.
Gary MacDonald and Colin Thomson of Highland Quality Construction Ltd (HGC) were disqualified for eight and six years respectively, for “responsibility over payments made to connected companies at a time when HQC was unable to pay its debts and disposing of assets belonging to a finance company without that company’s consent.”
The company entered receivership on 2 June 2010 with estimated assets of £467,490 and estimated liabilities of £9,587,495, leaving an estimated deficiency to creditors of £9,120,005.
An investigation by the Insolvency Service found that despite a charge for payment having been served on HQC and remaining unpaid, payments totalling £520,857 were paid to connected parties.
Seven items of HQC’s plant and machinery which were subject to finance were also sold and the proceeds diverted to an associated business. A further 10 items of equipment, belonging to a finance company, were disposed of without the consent of the finance company, were sold for £486,000, resulting in a loss of that amount to the finance company.
Joanne Covell, a head of investigations, at the Insolvency Service, said: “Company directors are required to act in the best interests of the company.
“At a time when a company is insolvent and not paying its debts when due, the directors also have a duty to act in the best interests of the creditors. This is to ensure that creditors are treated fairly and in a transparent manner.
“Company assets should be handled in an appropriate manner, taking account of ownership and seeking to minimise potential losses to creditors.”