UKVN Law Firm

Address: 13 Huynh Van Banh, ward 5, Phu

Nhuan district, Ho Chi Minh city
Phone: 02345678, Fax: 02345678,
Email: ukvnlawfirm@gmail.com, Website:
Ukvnlawfirm.com

February 25, 2019

Pedro furniture company

#123 Rodeo Drive
Manchester, United Kingdom

Dear Ms.Lien
First of all, UKVN Law Firm please send you best
wishes for health and warmest greetings! Thank
you for your trust and using our service.

Basing on service contract number 234, signed

July 1, 2019 between your companies and UKVN
Law Firms, we offer you legal advice message
with the content as follows:

I. Task I
A. Background of advice:
Ms Lien has recently gotten a
mandatory liquidation request from
the court.
B. Customer requirements
B.1. What is the
circumstance of
compulsory liquidation?
B.2. How does a company
go into compulsory
liquidation?
B.3. What is the best
solution?
C. Legal grounds
C.1. The Insolvency Act 1986 (IA 1986)
Source: https://www.legislation.gov.uk/ukpga/1986/45/contents

C.2. The Insolvency (England and Wales) Rules 2016 (SI

2016/1024) (IR 2016).
C.2.a) Source:
 http://www.legislation.gov.uk/uksi/2016/1024/contents/mad

D. Brief advice
Your responsibility in the process of liquidation loss of liquidity should
be managed in a sensitive way. Failure to act in the way regulations can lead
to accusations of wrongdoing or illegal makes the situation worse which may
result in a penalty, a director disqualification or even personal liability for a
debt ratio of the company.
When a company becomes lost solvency, responsibility of the director
is transferred from shareholders or members of the company, to its creditors.
The company must stop trading immediately and protect your assets for the
benefit of creditors.
Responsible action as soon as you realize the company lost solvency
is necessary to eliminate the threat of personal liability.

E. Detailed advice
E.1. The circumstance of compulsory liquidation:

E.1.a) United Kingdom’s Law stipulates “bankruptcy” is only

applied for individuals and “liquidation” is the term used for
companies. Liquidation is the status of a company or
enterprise financial difficulties, losses or liquidation of the
enterprise does not guarantee sufficient payment of the debts
due.

E.1.b) There are two kinds of liquidation as “compulsory

liquidation” by order of the court, and “voluntary liquidation” by
the members of the company voluntarily instigated.
Compulsory liquidation is the usual process to the creditor
(someone owns dept) used to force liquidation company-in an
effort to cause the company to pay back debts. It can also
apply to the partnership limited liability in the same way as the
limited liability company.

In United Kingdom, the courts keep control the compulsory

liquidation that happens when an lender who your company
have not paided requested the court ordered the winding up. At
the trial, if the judge agreed, and the company was forced to
liquidate,the official recipient (a civil servant) will be designated
as the initial liquidation.

E.2. How does an enterprise go into obligatory liquidation?

The process begins when the court presents a winding-up
petition that has important consequences for an enterprise. The
company’s creditors is usually the petitioners but in the various
cases ( set in section 124, IA 1986), the enterprise can be put
into compulsory liquidation by itself, its directors and the
different categories of people. All of cases have the common
 point to winding up an enterprise when it can not pay its debts.
However, the special case in section 122 (1) of the IA 1986, an
order may be set up on the other basics.

A creditor must send the winding-up petition to the court to start

the procedure of compulsory liquidation. Creditors usually only
do so when they believe that the firm could not repay. They will
require enterprise to participate in compulsory liquidation while
showing proof that the corporation was not able to pay the
debt. This procedure is costly for creditors and, as such, be
regarded as the last resort. The court will seal the petition, and
assigned a court date, the official start compulsory liquidation
proceedings. The winding petition will be served to the
company and shortly thereafter, entered the London Gazette to
lead to the company's bank accounts frozen. In the case of
debts that recommendations are meets, winding
recommendations can be abolished, however you can also pay
similar fees.

Before winding recommendations, the more likely a company

will be served with a statutory demand. For this situation, you
will have 21 days to pay or 18 days to dispute the demand. As
a Director, you have to act to enforce a winding to save your
business. Because of the costs of an appointment in court, a
company voluntary arrangement (CVA) is the better method
exchanged an administration. Also, if you want in the initiative,
you can put the company into voluntary creditors liquidation
before the petition and the creditor will often withdraw the
petition, especially with a Her Majesty's Revenue and Customs
(HMRC) request.

The primary concern to note with obligatory liquidation is that

labor contracts are quickly and naturally ended on the judgment
execution of a winding-up request. In addition, any property,
processing can include cash at Bank, between petitioner and
issue orders to winding up and regarded as null and void
unless the order confirmation has been issued. Hence, all
payments in cash are repaid by the company's director or the
recipients. Therefore, it is important to act quickly, if you
received a petition winding, to avoid individual responsibility.

E.3. Advice
The main areas of responsibility to the Director of the United Kingdom
in the process of liquidation of limited companies:
1. Cease Trading
The moment you receive a court order that you stop
trading. Do not send any products, issue any bills, pay for any
employee or trying to seek finance. Any action at this stage
 there is no clear benefit of the creditors of the company may
also put you at risk of being charged with the wrong deal as
stipulated in Section 214 of the Insolvency Act 1986.
Company liquidators (bankruptcy professionals) have a
lawful command to research the conduct of executives during
the period paving the way to the liquidation.
Wrong transaction case can be proven, the directors
could face orders not eligible, this will prevent the director of
the company for up to 15 years. When the transaction is
proven fraud, the more serious consequences such as fines,
penalties and even imprisonment are potential consequences.

2. Directors powers to terminate

Under Section 103 IA in 1986, the director of the
company reserves the right director when Insolvency
Practitioner has been appointed, unless specific instructions of
the liquidator.

3. Hold a Shareholder Meetings

When the company has ceased trading, the directors
must call a meeting of company shareholders.

4. Advertising in the Gazette

A resolution to end the company has been through, it
must be advertised in the Gazette, the official journal of of
public profile, within 14 days. That will at that point show up in
this rundown and is a methods for telling potential loan
bosses with regards to the condition of occasions.

5. Appoint an Insolvency Practitioner

Specify a licensed insolvency practitioner (liquidator) is
a lawful prerequisite at this stage. Typically, the company
accountant or lawyer will have a relationship with an
insolvency practitioner, but the selection decision should not
find a person who can demonstrate experience in liquidity in
your business sector.

6. Director’s duty to prepare statement of affairs

Prepare Declaration on the problem of losing solvency
is one of the last significant role of directors and is the main
document to include IP handover situation update. This
document will analyze the financial situation existing
companies and include asset valuation, balance sheet
accounting recent list of employees, creditors and suppliers
and the full details of the terms in debt.

In case of liquidation is compulsory as opposed to

voluntary, that would be recipient Liquidation or official receiver
 prepared the SOA.

7. Director’s duty to cooperate with liquidator (Office Holder)

Constrained Company Directors have a legitimate
obligation, when insolvent, to convey any books and records
and data for that the vendor requires for the motivations behind
his/her examination.
On the off chance that you will not do as such, they can
demand the court to constrain you into doing as such, or to
coercively hold onto records.

8. Company directors have to agree to take part in interview with

the liquidator
As a major aspect of the liquidation procedures, the
liquidator may request a meeting with the organization director.
On the off chance that the meeting gives the vendor
cause for worry about the manner in which the business was
run, or you neglect to conform to the outlet's solicitations,
claims of offense could be made and may result in an
Insolvency Service investigation.

9. Summons procedure agreed to be considered (replacing the

old creditors meetings)
Once in the past, executives would have assembled a
conference of creditors, however ongoing changes in the law
have modified the procedure.
Presently the executive (convener) requests that the IP
assemble the 'Esteemed Consent Procedure' which is a
methods for picking up the assent of leasers over different
issues, for example, the arrangement of the liquidator.
Unless more than 10% of the creditors oppose, this will
be deemed as consent to move forward.

10. Directors' credit accounts

The potential for Ms.Loan's personally liable for the debts of the
company
Overall, the structure of limited companies is that there is a clear
distinction between personal and corporate responsibility. The
exception to this are the principles where:
● Director signed individual guarantees - these materials are
designed specifically to breach corporate veil and forcing an
personal to set individual property lines as collateral for the
debts of the company
● In case there's any false transaction evidence or fraud - the
case of the directors ' deliberately dealing after the loss of the
ability to pay, he may have to bear personal responsibility for
some or all of the debt
II. Task II
A. Background of advice:
Ms.Lien expects to sign the agreement with a Belgian Company to sell
furniture and fixtures. The legal representative of the Belgian company wants
to have a dispute resolution clause in the contract with the content:
“in the event of a dispute arising out of or relating to this contract, including
any question regarding its existence, validity or termination, the parties shall
seek settlement of that dispute by mediation in accordance with the LCIA
Mediation Rules, which Rules are deemed to be incorporated by reference
into this clause”

B. Customer requirements
B.1. Advise Lien about terms in a commercial contract and
mediation process for solving the disputes.

B.2. Advise Lien about the legality of new option concerning to

choosing arbitration for resolving their disputes and explain Lien about
arbitration process.

C. Legal grounds:

D. Brief advice: In any case, a self employed entity is normally a specialist,

so the preparation is generally insignificant and restricted in depicting
the points of interest of the work to be accomplished for this specific
organization. This area regularly clarifies that installments to self
employed entities do exclude annual duty derivation or finance
charges. Frequently, self employed entities are taking part so as to
accomplish a particular result for Lien, instead of giving their work to
enable principals to accomplish results. A self employed entity does not
have the lawful status of a worker and is included by a head - instead
of being utilized by a business. Self employed entities hold impressive
control and direction for the activity. No government or state annual
duty is deducted from installments made to the temporary worker
except if required to hold.

E. Detailed advice
1.1 What are commercial contracts?
1.1.1 Definition
Law of commercial contracts include a variety of topics. They
can be drawn between enterprises or businesses and their
consumers. The law gives the system to contracts to be attracted up
and upheld to guarantee they are legitimately authoritative
understandings, and breaking an agreement can be a genuine
offense.
Commercial contracts could be, for instance, an understanding
between at least two organizations to cooperate on the venture.
Commercial contract law gives them the devices they have to
formalize the agreement in the contract. In the relationship between
enterprises and consumers, law of contract is used to create the terms
and conditions under which businesses and consumers will be legally
binding. Consumers have purchased defective goods or other claims
against the retailer, can use contract law to trade (as it relates to the
interests of consumers) for a refund or use the court for other forms of
remedy. As the law can be perplexing - particularly over global limits -
never endeavor to bring a lawsuit yourself. Always contact your
qualified business lawyer to advise, help and support you throughout
your case.

1.1.2 List of clause in commercial contracts

● Parties and Contract Purposes
● The cost of contract
● Terms and the methof of payment
● Conveyance Schedule and Terms of Delivery
● Punishments and Liquidated Damages
● Terms majeure
● The Court or arbitration proceeding disputes
● Contract Effectiveness
● Cancellation, Suspension, Termination and Settlement
of Accounts
● Issuance of Performance Instruments
● Governing Law and Language
● Required Documentation and Events
● Boycott Clause
1.2 What is mediation process?
1.2.1 Definition
Mediation is a process of convincing the parties agree to
terminate the conflict or problems in a way satisfied by an
independent person outside of the court or arbitration
process. Mediation is of great significance, it is for these
disputes, conflicts, contradictions, frictions are snuffed out or
not to go beyond the gravity, helps the parties to mutual
understanding, to preserve the face of steady ... It is
frequently fundamentally faster and less expensive than
different types of debate goals. Mediation is a method of
solving misunderstandings. In a dispute, a third party
mediator is included to assist the parties to reach a
settlement. In many cases, the mediator does not have the
authority to make binding decisions.

1.2.2 The mediation process

When beginning the process of mediation, the parties
should be uniform on some kind of structure or frame that
 reconciliation should follow, including an appropriate
timetable. A suitable location should be chosen, preferably a
neutral place. There should be enough room available to each
party to discuss the issues of privacy and confidence.
If complex disputes, the parties need to agree on some
instruction before mediation begins. For example, each party
may be required to prepare and submit a form 'statement
about the case’ to the mediator to mediator informed about
each position of a party. The parties may also be asked to
prepare a batch of related documents will be revealed to the
mediator and to each other before mediation begins. The
parties should decide who will attend the mediation session
(for example: representatives of each party).. Mediation
session usually begins with 'plenary'. The mediator will
present the nature of the dispute, and identify and clarify the
objectives of mediation. The middle person will show the idea
of the question, and recognize and explain the goals of
intercession. The mediator will also address other issues, for
example, justice, procedural rules, confidentiality and
privilege, and the legal status of the agreement reached.
Each side will present its case to the mediator that is
not interrupted by the other party. The questions may be
allawed after each presentation of party. There will be
sessions in which each side breakout will move to another
room to discuss privacy issues in the proceedings. The
parties will then try to reach a settlement agreement and each
party can make its own proposals to solve. The mediator can
try to narrow the issues in order to facilitate negotiations
between the sides. In some cases, the mediator can prepare
non-restricting proposals to the parties for consideration.
Arbitration is the way toward documenting a question for a fair
individual to decide the last and official. In a discretion
procedure, the legitimate principles of proof don't make a
difference and there is no formal disclosure process.
Arbitration is incorporated into numerous business contracts,
as an option or compulsory debate goals process.
The mediator may demand significant reports and referees to
give their sentiment subsequent to thinking about the case.
The two gatherings have the chance to show their case, yet
regularly don't have observers or other court methods or
archives. Similarly as with intercession, this procedure can be
booked and settled rapidly, and it is less conflicting than suit.
1.3 Advise
Lien suggests that this provision should be provided in an independent agreement because it
is not a term in the contract.
◦ It records the contractual worker's rights to perform administrations to others
except if they straightforwardly strife with or rival the activity for this
 organization. It will show whether you will give a collaborator or that the
temporary worker will utilize his staff to help do the activity.
◦ This area likewise subtleties the points of interest of any preparation gotten by the
temporary worker. In any case, a self employed entity is normally a specialist, so
the preparation is generally insignificant and restricted in depicting the points of
interest of the work to be accomplished for this specific organization.
◦ This area regularly clarifies that installments to self employed entities do exclude
annual duty derivation or finance charges. No government or state annual duty is
deducted from installments made to the temporary worker except if required to
hold. No FICA expense is deducted from the temporary worker's remuneration
and they are not saved for contractual workers.
◦ A self employed entity does not have the lawful status of a worker and is included
by a head - instead of being utilized by a business. Self employed entities are in
charge of their own duties, superannuation and protection. Frequently, self
employed entities are taking part so as to accomplish a particular result for Lien,
instead of giving their work to enable principals to accomplish results. Self
employed entities hold impressive control and direction for the activity.
◦ The mediation process is sometimes used instead of litigation, but is often used to
resolve disputes before they reach the point where lawsuits or arbitration are
required.
◦ This process is less expensive than a long and expensive test. Both parties share
the cost of a mediator. The ability to continue the business or personal
relationship later is much greater because the dispute has been resolved with the
consideration of both parties. The mediator may propose creative solutions or
accommodation.
2.1 Arbitration
2.1.1 Definition

Arbitration is the way toward documenting a question for a fair

individual to decide the last and official. In a discretion procedure, the
legitimate principles of proof don't make a difference and there is no
formal disclosure process.

2.1.3 Arbitration clauses/agreements in commercial contracts

Some commercial contract with an arbitration clause requires the use
of arbitration in case of disputes arising. Although these terms are not
mandatory, but they can avoid litigation unnecessary and are particularly
recommended in the case of contracts across borders (ie between
businesses in areas other legal together).
If the rights or obligations prescribed by law is concerned, an
arbitration clause will usually be applied by the relevant regulations. For
illustrate, employees can not sign contracts with the labor law rights under
their statutory priority for an arbitration clause in the labor contract.
The competition will usually be resolved much sooner, since mediation dates
can often be taken significantly faster than the court date. In Virginia, a
preliminary date is usually about one year from the date the complaint is
recorded.
Intervention is generally much more affordable. Incomplete it is on the basis
that the fees paid to judges are significantly inaccurate to the cost of paying to
the main observers to come and confirm at preliminary. (More often than
gatherings to intervene the same judge's cost division.) There is also a lower
cost of getting ready for assertions compared to preliminary planning costs.
Mainly because of the way that the proofs are often looser than the
preliminary, the goal is that reports can be sent in lieu of having an observer
come first and assert. For example, if a petitioner has several ambiguous
experts, the cost of bringing them preliminary or leaving the state to obtain
statements may be limited to preliminary, however, in the case Card, you can
only use most of their profiles and reports.

Contrary to preliminary, mediation is basically a private system, so in the

event that gatherings want to be protected, at that time, the debate and goals
can be kept secret. honey.
In the case of mediation being competent, there are open doors that are
specifically restricted to the two sides to request, so the decision will be the
end of the debate. That gives the absence of an intervening intervention grant
that often appears with a preliminary choice.

2.1.4 Arbitration Procedure

Arbitration Act, 1996 providing for the arbitration proceedings in
England, Wales and Northern Ireland. The arbitration settle on the procedural
and evidentiary issues. Typically the disclosure of the document would be
required and may have the cross-examination of witnesses, but the
proceedings are usually shorter and less formal than litigation. Arbitration
decide certainly on a case, based on the evidence given by the parties.
Arbitration is voluntary, so both parties must agree to go to arbitration;
they ought to likewise concur ahead of time that they will comply with the
referee's choice.
2.2 Advise:
The gatherings of the competition spent most of the concurrence with the mediator, so the
referee would be the one that the two sides would certainly not be impartial and reasonable.
The competition will usually be resolved much sooner, since mediation dates can often be
taken significantly faster than the court date. In Virginia, a preliminary date is usually about
one year from the date the complaint is recorded.
Intervention is generally much more affordable. Incomplete it is on the basis that the fees
paid to judges are significantly inaccurate to the cost of paying to the main observers to come
and confirm at preliminary. (More often than gatherings to intervene the same judge's cost
division.) There is also a lower cost of getting ready for assertions compared to preliminary
planning costs. Mainly because of the way that the proofs are often looser than the
preliminary, the goal is that reports can be sent in lieu of having an observer come first and
assert. For example, if a petitioner has several ambiguous experts, the cost of bringing them
preliminary or leaving the state to obtain statements may be limited to preliminary, however,
in the case Card, you can only use most of their profiles and reports.
Contrary to preliminary, mediation is basically a private system, so in the event that
gatherings want to be protected, at that time, the debate and goals can be kept secret. honey.
In the case of mediation being competent, there are open doors that are specifically restricted
to the two sides to request, so the decision will be the end of the debate. That gives the
absence of an intervening intervention grant that often appears with a preliminary choice.

III. The assumptions, reservation

❖ The documents that we provided the full copy, exactly like the original, the signature
and the handwritten part added to no element of fraud.
❖ The authorization documents in the dossier are valid.
❖ The parties to a contract are qualified and competent to enter into contracts and
agreements related.
❖ This advisory letter was drafted at the request of your company and exclusively for
your company. The explanation and indentifies in this letter is understood to assess
legally relevant to the requirements of your company. We are not responsible for the
content of messages advising when used for any purpose other than the purpose of
this advisory letter.