Directors banned by court

Four former directors of Structural Concrete, the company wound up in 1996 with debts totalling over £1m, have been banned by the High Court from holding further directorships.

Three were banned for two years each and one for four years. However, the bans imposed last Wednesday (21 June) have been suspended pending an appeal.

The bans followed an appeal by the Official Receiver against refusal by District Judge Wilby at Bolton County Court to impose disqualifications under the provisions of the Company Directors Disqualification Act 1986.

Now Justice Blackburne has held that Judge Wilby was wrong and has banned Thomas Barnes from holding a directorship for four years, and Brian Barnes, Leslie Dutton and Alan Cuningham for two years each.

Justice Blackburne said Structural Concrete, a subsidiary of Barnes Construction (UK) began trading in early February 1994 and ceased trading in the autumn of 1996.

He said that during its brief life the company undertook only seven contracts in which it was employed as a subcontractor. Each project involved a major construction project and the main contractors were in the main substantial organisations. However, he said the company experienced difficulty in recovering what it claimed was due from the main contractors in five of the seven contracts .

It had, he said, been the victim of "subbie bashing" as main contractors tried to boost their cash flow. To offset the financial problems created by this he said Structural Concrete withheld payments to the Inland Revenue from January 1995 onwards.

He said this was part of a "deliberate policy of discrimination" carried through by Thomas Barnes and acquiesced by his three co-directors.

Finding that the earlier ruling under which the four were not subjected to bans was wrong, the judge said it would require exceptional circumstances to justify a finding that misconduct such as had taken place did not justify a finding that the directors concerned were unfit to hold directorships.

However, he accepted that the four, in acting as they did, had no intention of benefiting themselves and had every intention of discharging what was due to the IR and others, and in those circumstances the appropriate disqualification periods were the lowest allowed on the disqualification scale.