Bona Vacantia is a legal maxim whereby an ownerless estate passes to the Crown. At first glance, this maxim sounds very niche. However, Bona Vacantia is a lot more common than it seems, and if you are planning to dissolve a company, then your alarm bells should start ringing. This is because if a property is owned by a company and ownership is not transferred before the company dissolves, then the property owner essentially no longer exists and the Crown takes ownership of the estate.

However, all is not lost; if you have dissolved a company within the last 6 years and the property is still in the company’s name, then you can apply to have the company restored to the Register of Companies and remove the property from the Crown’s ownership.

There are two ways in which a company can be restored – either by administrative restoration or by obtaining a court order.

Administrative restoration

Who can apply and when?

Administrative restoration is only available where a company has been dissolved involuntarily under s1000, 1001 or 1002A of the Companies Act 2006 (CA 2006), or under s652 of the Companies Act 1985 (CA 1985). This type of restoration is principally intended for companies that have been struck off the register involuntarily due to failing to keep up to date with their filings at Companies House. You can only apply for administration restoration if:

• You were a director or member of the company;
• The company was dissolved within the last 6 years; and
• The company was trading at the time of being dissolved.

Procedure of administrative restoration

Depending on what reason the company was struck off to begin with, you will need to be mindful that there are specific conditions that need to be met before the Registrar will restore the company, for example, paying any outstanding penalties owed by a company that has failed to deliver their accounts on time.

In order to apply for administrative restoration, you must send Companies House:

• A completed application form;
• A cheque for £468.00;
• Any outstanding documents (such as accounts or confirmation statements);
• Any filing fees or penalty payments; and
• A waiver letter in relation to Bona Vacantia.

A Bona Vacantia waiver letter is the Crown representative’s written consent to the company restoration. If the registered address of your company falls within the Treasury Solicitor’s jurisdiction, an application form will need to be completed and sent to the Government Legal Department, along with a fee of £64.00. If the registered address of your company falls within the jurisdiction of the Duchies of Cornwall or Lancaster, then you will need to contact their solicitors, Farrer & Co, in order to request the relevant waiver letter.

Restoration by court order

Who can apply and when?

S1029 CA 2006 sets out the circumstances where you will need to apply for a court order in order to restore your company, and this includes situations when the dissolved company was struck off the register voluntarily. You must apply for a court order within 6 years of the company being dissolved, unless the company is being restored in relation to a personal injury claim or the company was originally struck off under s652 or s652A CA 1985.

This method of restoring a company differs to administrative restoration in that a wider group of people can apply for the company to be restored, including former directors, members, creditors and liquidators of the company. S1029(2) CA 2006 provides the full list of who is eligible to apply for a court order to restore a company.

Procedure of obtaining a court order

In order to begin the application process, a claim form must be submitted to the court, along with a witness statement of the applicant, and the court fee, which is currently £318. There are specific requirements for what information this witness statement must contain in order for the claim to be accepted, namely, details of the company being restored, why the company was struck off the register to begin with, and why it is being restored now.

The claim form and witness statement must be filed at the court and served on both the Registrar of Companies and the Treasury Solicitor. If the court accepts the claim form, a hearing date will be set. However, so long as all the relevant documents are obtained beforehand, a court order to restore a company can often be issued without the need for the hearing to take place.

The Registrar of Companies and the Treasury Solicitor will respond to your application with the conditions they require to be satisfied before they will approve the company restoration. In cases where the company is being restored to reverse the effects of Bona Vacantia on the company’s property, the Treasury Solicitor will require the applicant to give undertakings that they will not use the company for any reason other than to transfer the property, and that they will dissolve the company exactly 3 months after the transfer has taken place. You will also be required to pay the Registrar of Companies legal fees which are around £300.

Similarly to administrative restoration, you will also need to request and pay for a Bona Vacantia waiver letter from the Treasury Solicitor or Farrer & Co (depending on the location of your company).

Once you have satisfied the Treasury Solicitor’s and Registrar of Companies’ requirements, they will issue you a draft consent order. This, along with your undertakings and the waiver letter, will need to be filed at court in order for a sealed consent order to be issued. This sealed consent order must then be delivered to the Registrar of Companies in order for the company restoration to be authorised.

Next steps

Once your company has been restored, the property will need to be transferred out of the company’s name. However, you will first need to check if the property has been disposed of or disclaimed by the Crown as this will affect whether the property can be re-vested in the company’s name.

If you are transferring the company to a director (or a person connected to a director) then you will also need to have a shareholders’ resolution prior to the transfer in order to comply with s190 CA 2006.

Once the property is transferred, you will need to make sure you comply with your undertakings and dissolve the company accordingly.

Summary

If you are considering dissolving your company, make sure any property is no longer in the company’s name to avoid the effects of Bona Vacantia! However, if you have already dissolved your company in the last 6 years without transferring your property first, then do not panic – if you would like advice on how to restore your company, or have more queries regarding Bona Vacantia, then the Geldards’ Commercial Disputes Resolution team will be happy to assist and guide you through your concerns.