How do I make an application to extend the period allowed for delivery of charges to the Registrar? Is the process or timing different while coronavirus  social distancing measures are in place?

How do I make an application to extend the period allowed for delivery of charges to the Registrar? Is the process or timing different while coronavirus  social distancing measures are in place?

Produced in partnership with Phillip Patterson of Hardwicke Chambers

In what circumstances can an application be made?

A charge created by a company must be registered at Companies House. Significant consequences flow from a failure so to register. The requisite forms to effect the registration must be delivered to Companies House by the end of the period of 21 days beginning with the day after the creation of the charge. If the documents are delivered after that date, the Registrar will only register the charge if the documents are accompanied by a court order made following an application under section 859F of the Companies Act 2006 (CA 2006).

CA 2006, s 859F is a provision which allows the 21-day period to be extended by application to court. Although the wording of CA 2006, s 859F(3) appears prospective in its nature, in practice, particularly given the test to be applied in CA 2006, s 859F(2), such applications are only made retrospectively, ie once the deadline has already been missed.

What will the court consider when deciding to grant the order?

The 21-day period may be extended if any of three circumstances applies:

• the failure to deliver the documents on time was accidental or due to inadvertence or to some other sufficient cause

• the failure to deliver the documents on time is not of a nature to prejudice the position of creditors or shareholders of the company, or

• on other grounds it is just and equitable to grant relief

What is the process and documentation required for the application?

An application  may be made by the company or a person interested. A CPR Part 8 claim form is used to make the application and must be accompanied by an affidavit or witness statement setting out which of the grounds in CA 2006, s 859F(2) is relied upon and why. No defendant is generally specified on the claim form.

The application must also include a completed Appendix A, a template of which has been produced by HMCTS in the form LOC009. This template refers to the previous sections of CA 2006 and, therefore, must be amended before the application is made.

A copy of the charge must be exhibited to the affidavit or attached to the witness statement in support. The original charge must be produced to the Registrar at the hearing.

Evidence of solvency should also be produced from a Director or the Secretary of the company, confirming:

• that no winding up order has been made against the company, nor has any resolution for voluntary winding up of the company been passed

• that no winding up petition is pending and no notice of a resolution to wind up the company has been given, nor is one contemplated

• that the company is continuing to carry on business; that there are no unsatisfied judgments against it and that no creditor is in a position to recover judgment against it

The claim form must be issued and heard in the Central London County Court (if in London) or a Chancery High Court District Registry outside London.

For further information on the procedure and links to example claim forms, witness statements/affidavits and draft orders, see Commentary: Filing with Registrar of Companies: Atkin’s Court Forms [304], in particular step 8.

How does the process/documentation differ for each type of applicant (eg chargee or chargor)?

The process is similar save that where the application is brought by a person interested rather than the company itself, the company must be served with the application.

How long does the process take?

By way of example, application made to the County Court at Central London are normally bulk listed at 11 am on a Monday. Typically, from the application being issued to the hearing determining, it takes around 4–6 weeks. Where the application is issued outside of London, the timescale may differ depending on court work load.

What is the cost of making the application?

The court fee is currently £280. Solicitors may also charge fees for preparing the applications and a brief fee may be required for a barrister to attend the hearing.

Once we have obtained the order from the court, is there anything else we need to do?

Once the order is obtained, it should be sent to the Registrar of Companies together with the other documents required for registration pursuant to CA 2006, s 859A.

Will coronavirus social distancing measures impact the process or documentation, and, if so, how? Where can I find up-to-date guidance on changes to court procedure in light of social distancing measures?

For up-to-date information on court process while social distancing measures are in place, see Practice Notes:

• Coronavirus (COVID-19) implications for dispute resolution

• Coronavirus (COVID-19)—Changes to the court process in insolvency proceedings, in particular sections: Business and Property Courts work and Insolvency and company work at the County Court at Central London

In relation to company work at the County Court at Central London, on 24 March 2020, HHJ Dight CBE and HHJ Johns QC published a protocol for Insolvency and Company work during the coronavirus pandemic. The protocol stated that:

‘Claims for extension of time to register company charges will remain listed but only for the purpose of the Judge considering the claim on paper. There will be no attendance. The requirement to produce the original charge is waived in this period and evidence of solvency will be accepted by email to RCJCompGenCLCC@justice.gov.uk.’

For further information on the substantive law, see Practice Notes:

• Registering security at Companies House

• How to register security at Companies House

• Problems with registering security at Companies House—what to do next

Related Articles:
Latest Articles: