When a company is either voluntarily dissolved or struck-off by the registrar from the register of companies (the "Register"), it no longer exists; meaning that it no longer possesses legal personality. It is dissolved and any remaining assets vest in the Crown. However, a dissolved company is not always the end of the story and in certain situations, a company can be restored to the Register.

There are two ways to affect a restoration in certain circumstances: (i) administrative restoration under section 1024 of the Companies Act 2006 (the "CA 2006"); and (ii) by way of court order. The correct procedure to use will depend on the specific situation.

Why restore a company to the register?

There are various reasons which make restoration a useful tool, including for creditors so that their debt can be paid; the company holding title to an asset which needs to be transferred or perhaps where someone wishes to claim raise a claim against the company. It may also be that the shareholders or directors simply wish the company to continue trading.

If an application for restoration is successful, either by court order or by way of the administrative process, the company is deemed to have never been dissolved and as if it had continued in existence (see Brodies' blog on the decision from the High Court of Justice in England and Wales in Bridgehouse (Bradford No. 2) v BAE Systems plc which provides some useful clarification on the effect of being restored on a company’s contractual and business relationships).

Administrative restoration

Administrative restoration is the easier and more straightforward of the two processes, involving an application to Companies House and a fee of £100. This procedure can only be used in limited circumstances and is aimed at applicants who wish the company to continue trading (for example, if the company had filed its accounts late and had been struck off as a result). On that basis, administrative restoration can only be used if the following circumstances apply:

    • The applicant is a former director or shareholder of the dissolved company;
    • The company was struck off under sections 1000 or 1001 of the CA 2006;
    • The company was dissolved in the last six years;
    • The company continued to trade until the time it was dissolved; and
    • The applicant has obtained the crown's consent to the restoration by way of a bona vacantia waiver letter.

It is important to note that the applicant will also have to prepare all forms and paid all filing fees necessary to bring the dissolved company's filing record up to date. This includes the annual accounts and confirmation statements.

Court restoration order

If administrative restoration is refused, or it is not possible as the circumstances do not meet the criteria necessary for the administrative process, the alternative route is to restore the dissolved company by way of court order. In Scotland, this can be done at the Court of Session or at a Sheriff Court, depending on the amount of the company's paid up capital. In England, this can be done at the nearest county court.

This process is often much lengthier and more expensive as it is subject to the costs and the timetable of the courts.

Importantly, it is not only a former shareholder or director who can make this application. This process, however, is still limited to persons who have an interest in the company being restored and this is a decision at the discretion of the court. Persons who may be deemed to have an interest may include, for example, a creditor of the company, a person who has a contractual relationship with the company or a person who has a claim against the company. Note that companies which were dissolved more than six years ago may only be restored to the register where there is a personal injury claim.

It the court grants an order to restore a company to the register, it can also make various other orders it sees fit in order to restore circumstances to those which would have been had the company never been dissolved.

How Brodies can help

It is important to choose the correct process for restoring a company to the register, considering the circumstances of the company before it was dissolved. If you require assistance in making this decision and preparing the necessary documentation, please get in touch with the Brodies' corporate team.