Do registered companies carry legal insurance?

[Amilcar]

It transpires that I am to sue a registered company (not the principal, himself, as previously intended). It is a registered company (French).The defendant has been steering me towards suing the company. So I am wondering what advantages there are for him apart from, presumably, limiting his own liability. Does anyone know whether registered companies are generally covered by insurance that would tend to pay up if sued, please? If so, I imagine insurer would seek the cheapest option where the Claim is well-grounded, ie settlement out of court.... ( I'll also pop this question on the business and financial section in case it's more their thing). Cheers.

[buildersmate]

As I recall, this is something to do with you maintaining a liability in respect of something that went wrong with the purchase of a car from a French-registered trader (a limited liability company)?
In the UK, there is no such requirement for a limited liability company to take out insurance for this sort of risk. The only legal requirement is to have insurance called Employers' Liability. This is in respect of negligence for injury to customers or employees on the premises because the employer did something stupid. Tripping over a step - that sort of thing. Companies offering professional services (accountants, lawyers etc.) often take out professional indemnity insurance - this provides for insurance against professional incompetence in respect of advice given. I doubt very much whether this is anything to do with having insurance cover.
The reason why your trader is steering you towards suing his company is because your alleged loss is in respect of the actions of the French company, albeit those actions were allegedly purpetrated by the director acting on behalf of the company.
As always in the UK, there are two parts to winning back money in this situation - winning the legal case and actually getting the money. It is perfectly feasible for you to win the first but still not get the money if the company were to be put into adminstration or were to be wound up.
But the law in France may be different.
Please remind us what the nature of your allegation is.

[Amilcar]

Hi,
Thanks for the response. Yes, you have remembered the gist of it. I was suing an individual "trading as" (name-of-company). My Claim was launched in February. In March he acknowledged it, indicating on his Defence Statement form - in the 'individual ' not 'company' box - that he disputed the Claim. Subsequently, his solicitor mentioned in a letter to the Court that he was "a sole trader" and even when the Allocation Hearing took place and Defendant's Draft Directions were submitted, a few weeks ago, the defendant still listed himself - personally - as, "Defendant." Only on submission of Amended Defence (Sept. 4) did his solicitor announce that the contract had been with client's company (a registered company, in France). I have applied to change the Defendant accordingly by CPR Rule 19 and a 5-minute hearing is schedlued for Oct 9th for the judge to decide on this matter. My latest question was aimed at finding out what motive - apart from legitimately avoiding personal liability - the defence might have for making the company liable? The company in question is only a one-man/family business so, effectively, he will pay up whoever is sued. I don't think he would want to ditch his company along with its "reputation" to avoid paying my Claim since the bulk of the Claim concerns taking back the car I bought and refunding me ie he will recoup most of the money he pays me by selling the car on. Thanks for your interest.

[buildersmate]

Once again, I must repeat that I know nothing about French corporate law and structures.
But in the UK if your contract was with his company, not with him, it is the company that you would have to sue, not him personally.
Please appreciate that there is a distinct separation between the assets held in a business and the assets held by an individual who is an owner of the business (through a shareholding, in the case of a limited liability company). The two are just not linked together and it is perfectly possible that he is just trying to stall you or get you to sue his company which has few net assets (the difference between the assets it has less the liabilities that he owes to others).
Have you checked the size of the shareholders funds in the company? - it may have none - though this is unlikely if he appears to still be running the business as a going concern.

[Amilcar]

Thanks for that answer; it really helps. I will try to look into it, this week. Not that I can do anything, if that is the case. If my contract is with the company, I've no doubt he can arrange it that the company will not be able to meet the Claim -- and I am stuffed. Assuming that arrangements in France are similar to ours, wouldn't the company have to declare its assets? Would suing the company make it bankrupt: surely, he wouldn't want that? I am very frustrated as this has already gone on for a year and all I'm seeking is a refund for genuinely unsatisfactory goods which I rejected the day after delivery. Grrrr !!

[buildersmate]

He (and hence his company) seems to disagree with your unsatisfactory goods allegation, or he wouldn't be fighting the case as far as the Courts. Especially with the prospect of having to pay legal expenses. There are others on this site (Barmaid, Ethel) who know a lot more about court proceedings than I do - in terms of extracting money if one wins the case. But I would urge you to consider (even that this stage) you assess the total monies you have at risk (including legal costs) versus what you consider you have lost in terms of the 'useless' car. You seem to feel he would be able to do the car up again and resell it, so it isn't a complete write-off.
In the UK, one finds out the financial position of a limited liability business by paying a small sum to Companies House to provide a copy of the latest accounts. These legally have to be lodged with them.

[Amilcar]

Hi and thanks, once more. Yes, I have found a French website that will supply the company's financial details for a few Euros and, once I have got my head around the French instructions, I'll look into that. As far as his case is concerned, one of the main faults to the car is that it has its VIN and engine number plaques missing despite the Defendant's advertsing that it has "matching chassis and engine numbers." This is an important selling point relating to desirable originality in a vintage car and has a profound impact on value. My Claim against him is based on Distance Selling under which he did not allow my cooling off period, Sale of Goods Act for faults inc. misdescriptions and Misrepresentation Act for the mentioned numbers anomaly, plus spurious chassis number on Bill of Sale and misidentifying model year of car and/or model type. Under the latter Act, you'll be aware, the onus is on him to prove he had good grounds for believing the statements he made re. identity/provenance of the car (which he could not have had due to the physical absence (?) of the number plaques. I have documentary evidence to show the misadvertising (even that he doctored the advert after the transaction to cover his tracks). So, I do have a good case. Except that, as you pint out, winning in court is only half the battle. I am hopeful that faced with losing and paying for two barristers, etc., he might see sense and give me the refund that I've been seeking since Day One. TNX.

[buildersmate]

OK, good luck with it.
One final thing - was the contract under English law? - I assume so since you are quoting various English legal Acts.

[Amilcar]

Hi,

In cases of consumer contract, customer has right to choose the law of his country and country of jurisdiction.
Choice of law is under Rome Covention Articles, 3 and 5. Jurisdiction is governed by Brussels Regulation 1, Articles 25, 22 and 27.

Cheers,
B.