In the recent unreported case of The Secretary of State for Business Energy and Industrial Strategy v Al-Safee (unreported) the defence run was that the Defendant was not the company’s director. Mark Baldwin, the solicitor with conduct of the proceedings for the Secretary of State, considers the judgment.
The Secretary of State issued director’s disqualification proceedings against Mr Al-Safee alleging that he had failed to maintain and preserve or deliver up adequate accounting records for Exotic Global Limited. Mr Al-Safee’s defence was simply that his identity had been stolen and he was not the Mr Al-Safee who had been the director of the company.
Mr Al-Safee was the sole registered director of the company between 29 October 2013 and the date of liquidation.
The Defendant Mr Al-Safee had produced an Iraqi passport as proof of his identity during the proceedings. The details in that passport corresponded with the details in UK passports issued for the director Mr Al-Safee and with copies of his driving licence, which had been produced to two banks and HMRC during the life of the company. The Defendant Mr Al-Safee accepted in closing submissions that the driving licence and British passport were his, but they had been stolen in April 2014 when he had applied for a replacement passport.
The liquidator gave evidence that the man before the court was the Mr Al-Safee that he had met on two occasions in June 2015 during the process of placing the company into liquidation.
Insolvency and Companies Court Judge Jones had little hesitation in finding that Mr Al-Safee was lying and that he was the director of the company. He also accepted that the Secretary of State’s allegation was made out as no accounting records had been delivered up to the liquidator despite numerous requests.
Judge Jones found that:
“In my judgment I should view this unfitness from the perspective of a serious failure to keep accounts and other books and records. I should do so on the basis that this has not only seriously hindered the conduct of the liquidation but also the investigation of potential fraud and/or misfeasance…I should also take account of the Defendant’s conduct in the course of this claim. In my judgment his lies are to be analysed as an attempt to pervert the course of justice concerning his dealings as a director of the company”
ICC Judge Jones therefore concluded that the case fell within the top bracket in Re Sevenoaks Stationers (Retail) Limited  Ch 164 CA, and, following submissions, disqualified Mr Al-Safee for a period of 13 years.
The points of interest in this decision is that Mr Al-Safee’s conduct during the proceedings was taken into account when fixing the period of disqualification. The Secretary of State had initially sought a period of 10 years in the Section 16 letter sent to Mr Al-Safee, before the identity issue had arisen. In this case Mr Al-Safee made things worse for himself.
© Howes Percival LLP