In this video, Wills and Tax Specialist Lee Young looks at the different types of LPAs, whether you need one and what to include.
With current restrictions due to the pandemic, an important part of the MVL process that was very simple has become a sticking point.
At Frettens we offer an online swear process for MVLs. We have outlined how it works and how you can book yours in the article below.
We also answer the FAQs from directors who are liquidating their companies and need a ‘swear’ for an MVL.
Online swears for MVLs - Quick links
Is this information relevant for me?
It is, if you are:
- A director liquidating a company, in a solvent winding up (a ‘members’ voluntary liquidation’ or MVL), and
- You need a solicitor to witness a declaration of solvency.
If you’re from a liquidation firm, we’ve got information for you here.
Q: How do I book an online swear?
Check first with your chosen liquidator. Do they book it for you, or do they prefer you to arrange it?
If it is for you to arrange it, you will need to agree a date and time with them.
Then email us on MVL@frettens.co.uk.
Please put this information in your email:
1 The name of your company (being liquidated).
2 Your name and contact details.
3 Your chosen liquidator; their firm and contact details of the people there you’re dealing with.
4 Your preferred time and date for the video call (and some alternatives).
We will confirm the arrangements by email to you and your chosen liquidator.
Q: How much does an online swear cost?
We charge:
- The statutory oath fee of £5.00.
- A video conference facility fee of £77.50.
- VAT of £16.50.
The total cost is £99.
How do I pay the liquidation fee?
We will charge the fee to your liquidator. They will then charge it on to your company, as an expense they incur in liquidating your company.
We can’t invoice you directly for it. There are many small technical reasons for that. Our explanation would involve section numbers of Acts of Parliament, Statutory Instruments and Professional Regulations. You really don’t want that.
Q: How does an online swear work?
You’ll already be working with your choice of liquidator. They will prepare the document (with instructions about where to sign it) and send it to you, probably by email. They or you will set an appointment with us for a video call.
You print the document, sign it (don’t date it!), scan it, and email it to us.
At the video call, the solicitor will show you the signed document. They will ask you to verify your signature. Then they will administer the oath. It takes only a few minutes.
When do you need the signed document from me?
We need time to prepare it before the appointment.
We’re not likely to have to reschedule the appointment if we have it at least four clear office hours in advance.
Suppose your appointment is for 10.00 am on the Tuesday after the Easter bank holiday weekend. Because the office is closed on Good Friday, the weekend, and Easter Monday, we would need to receive your signed document before 2.00 pm on the Thursday before the weekend.
I don't have a scanner. Can I photograph the signed document with my phone?
A phone photo is unlikely to be good enough quality.
The final document (which needs further processing by us, after we get it from you) will have to be filed at Companies House as a public document. Companies House will reject the document if the quality is not acceptable for their purposes.
You can post the signed print to us, instead of emailing a scan. Do allow the extra time if you do that (and email MVL@frettens.co.uk for instructions).
I'm not sure about using the technology. Can we do it by phone?
Sorry, but we need to see you, and you need to see the same copy of the document as the one we’re working on. So it has to be a video call.
What video conference software do you use?
We use Microsoft Teams.
Microsoft have information about the devices it works on here.
It’s free to download, and you’ll probably want to set it up and try it out before the video call if you’ve not used it before.
What does 'administer the oath' mean? Do I need a bible?
The solicitor will use a set form of words to ask you to formally testify to the truth of the contents of the document. It is a bit like the words you would be asked to say if you were a witness in court.
The solicitor will be acting as a ‘commissioner for oaths’ and an officer of the court.
The words will be those of a ‘statutory declaration’, and are not sworn on the bible. But, if you want to swear the oath on the bible, you may do so. In that case, please make sure your copy is at hand when the video call starts.
What ID documents do you need from me?
None.
Our professional guidance is that we do not need to ask you to show us copies of your ID documents for this service.
Who will be on the call?
As well as you (and every other director who has to sign the solvency declaration) there will be:
A solicitor from Frettens and
(usually) somebody from your liquidator’s firm. They will be there as a friendly face and to answer questions about the liquidation procedure, if you have any.
Why do I even need an appointment with a solicitor?
It is a legal requirement. To appoint a liquidator in a members’ voluntary liquidation (MVL – a solvent liquidation) you, the director, have to testify that you think the company is able to pay all its debts, in full and on time.
The document to record that is a ‘declaration of solvency’. By law, that has to be a sworn statement, a bit like taking the oath as a witness in court. The solicitor administers the oath and signs the document to validate it.
Does the oath have to be administered by a video call?
Before 2020 oaths always had to be administered in a face to face meeting. Those were stopped in the Covid-19 lock-down, and the relevant bodies (professional regulators, the courts, Companies House) decided that documents could be sworn over a video conference call.
When face to face meetings are allowed, and convenient, they can be used instead of a video conference. We’ve found that many directors like the convenience of doing the work in a short video call. It saves them the time and inconvenience of travelling to a solicitor’s office and then hanging around in the waiting room for a short appointment.
My company is registered in Scotland. Is the procedure the same?
Yes. And we can administer the oath for the statutory declaration to put it into an MVL, whether you are north or south of the border (or anywhere else in the world).
We have overseas directors. Can they swear the document this way?
Yes they can.
We can arrange a time for the appointment that’s outside our normal office hours, to suit their time zone. (We may have to charge more if the time here is very anti-social.)
I'm doing something similar with my companies in Canada. Can you help with the sworn legal document I need for that?
Yes, we understand that Canadian legal practice is to recognise the authority of English solicitors to administer oaths. This is the case in many other English speaking (or cricket playing) countries.
We will have to charge a little more, as the wording on the documents will have to be more detailed and we will need to check with the Canadian lawyers that it will be acceptable to them.
I have a document that has to be notarised. Can you help with that?
Sorry, for that you will need a notary public (which is a different legal qualification). But do check first that it does need a notary. Here’s a link:
Sorry - I've just realised that I should not have dated the document!
Don’t worry, we’ll work around that. (If the date is wrong, it may look a bit messy.)
Sorry - I'm not sure that I signed it in the right place!
Don’t worry, we’ll work around that.
I also need a witness to sign the deed of indemnity for the liquidation; can you help with that?
Yes we can, if you sign it in advance and send it to us with the signed declaration of solvency.
There may be more people signing that than sign the solvency declaration. You will need to make sure that all who need to sign the indemnity deed (from your company) are on the video call with you.
Please note that we won’t be able to advise you on the deed of indemnity, we will simply be the witness to your signature.
We’ll include that in our normal fee.
I have another question...
Email either the question, or a request for a call back, to MVL@frettens.co.uk.
