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Are there any grounds to prevent the court sealing the notice of intention by a qualifying floating charge holder? Please note that the final demand under the debenture and the personal guarantee stated the wrong redemption figure.
we took out a loan in the region of £138,000. This loan has now been called in and the bank wishes to place the company in Administration using the out of court route. The debenture includes a fixed and floating charge over all the property of the company. However, in our opinion the bank has breached the terms of the facility letter which only includes an increased rate of interest of 4% and we have been charged a management fee of £5000 and a late payment fee of £2000 we have also been charged interest over and above the agreed 4% at a rate in the region of 4.09%. Accordingly, the final demand received under the debenture and the personal guarantee contained the wrong redemption figure. We wish to prevent this action taking place or at the very least buying time.
You say the bank is in breach - are you saying there is no provision in the facility agreement or the charge for fees or expenses ? That is most unusual. Almost all bank facilities have provision that enables them to charge additional fees and expenses. Clearly if interest is capped at 4% fixed and they have charged more you can challenge that but the critical question is whether aside from that you were in default or the loan was capable of being called. You have a right to attend an application to the court and object to the petition to appoint the administrator but to do that you would need to show a) that you were not in default and the bank were not entitled to call the loan or b) you can discharge the loan. If you cannot repay the loan and are technically insolvent I think you have no chance of defeating the application. I assume the bank think they can get their money back from your assets and are not worried about destroying the business - certainly that is usually the case.