Once security documents are signed the next stage is for the security to be registered against the granting company’s mortgage index at Companies House. Depending on the type of security, there are different formalities to follow, additional perfection requirements and additional registers which the security may need to be registered on. This is a meticulous process, with great importance on getting the company’s name and number correct. In January of this year the importance of checking the company name and number when submitting forms to Companies House was thrown into the spotlight in the case of Sebry v Companies House.
This case revolved around the error of a mistaken ‘s’ being entered at the end of a company name at Companies House. The High Court had made a winding up order against the company Taylor and Son Ltd. This order, which omitted to include the company number, made its way to Companies House for registration. Companies House admitted that further checking procedures were not followed and the company number remained omitted. With no company number and procedures not being strictly adhered to the mistaken inclusion of an ‘s’ came about, changing what should have been Taylor and Son Ltd to Taylor and Sons Ltd, a completely unrelated company.
Companies House let Mr Sebry, the managing director of the company Taylor and Sons Ltd, know that the company was in liquidation, much to Mr Sebry’s dismay! Taylor and Sons Ltd’s solicitor quickly got this resolved, however, it took a month for Companies House to amend the error on the Register. By this point, the news of the company’s apparent dire financial situation had spread, leading its customers and suppliers to wrongly believe that the company was going into liquidation. As a direct result of this incorrect information being readily available to the public on Companies House the company, incorporated in 1900 with approximately 250 employees, unfortunately went into administration.
A lot should be learned from the above case of a mistaken ‘typo’, most notably, the importance of checking and double checking company names and numbers. When a seemingly minor mistake can have such shattering consequences, clients should be safe in the knowledge that attention to detail is at the forefront of a solicitor’s mind when completing Companies House forms for the registration of security documents. Mr Justice Edis in the Queen’s Bench Division of the High Court found in favour of Mr Sebry, however Companies House are currently appealing the decision…
On May 18, 2015