Administrators rejecting credit notes for ATL invoices

I was somewhat happy in that I managed to get credit notes from Albany Technologies in January for outstanding invoices for November and December. The administrators just faxed my customer to advise the credit notes were rejected because they were issued just before insolvency.

Does anyone know the legal basis for this? Something like credit notes get invalidated if made within 3 months of insolvency? But the invoices do not get invalidated?.. Is there any way to combat this? I imagine a large number of ATL contractors are about to face this problem - well, those "lucky" enough to get credit notes in the first place.

I am 99% certain that if the customer pays the invoices I will see nothing.

Were any of you guys who were also contractors with ATL contacted by the administrators?... I haven't heard from them yet.

seekinganswers wrote:

Were any of you guys who were also contractors with ATL contacted by the administrators?... I haven't heard from them yet.

Nope not me, my agency has a contract with ATL they have not heard anything either.
Administrators dont not seem to answer phone calls, return them or answer e-mails from me.

ATL_Victim wrote:

I was somewhat happy in that I managed to get credit notes from Albany Technologies in January for outstanding invoices for November and December. The administrators just faxed my customer to advise the credit notes were rejected because they were issued just before insolvency.

Does anyone know the legal basis for this? Something like credit notes get invalidated if made within 3 months of insolvency? But the invoices do not get invalidated?.. Is there any way to combat this? I imagine a large number of ATL contractors are about to face this problem - well, those "lucky" enough to get credit notes in the first place.

I am 99% certain that if the customer pays the invoices I will see nothing.

You might be right:

"According from the end year report 2008 at http://wck2.companieshouse.gov.uk/:
Albany Techonologies had a debt of £ 5,018,338 to Albany Holdings LTD for coming 2009."

Albany Technologies operated on basis of owing money to Albany Holdings and had not much real assets at least end of 08.
So all the invoices will be most likely get sucked into by Albany Holdngs.
It looks like a "clever" set-up to transfer all the owed money to Albany Holdings in a event of what like what just happened.

And another thing is that Albany Holding "seemingly" has been loaning money against outstanding invoices ( who's invoices that might be? ) from RBS http://www.rbsif.co.uk/ to fund some of it's operations.
This company is now a guaranteed creditor according to the files found from the Albany's company house register. I would also guess that all above is also "legal" as Albany companies has been audited every year.

If above is true it's so risky set-up from Albany in current economy and unfair against us contractors in so many levels that I can't bring it to words.
Lets hope that the administrators see us as priority creditors and can collect enough money to pay at least some part of our money back.

I'd get some legal assistance on that issue. I think it would be wise to expect a certain amount of scare-mongering from these folks, even if it has no basis in the law whatsoever. Should be fairly easy for an IP-pracitioner or a solicitor to establish. Get someone to write them and explain what contractual or legal obligations they are making that claim on and let them know that, if the claim is unsubstantiated, they will be hearing further from your solicitor.

ATL_Victim wrote:

I was somewhat happy in that I managed to get credit notes from Albany Technologies in January for outstanding invoices for November and December. The administrators just faxed my customer to advise the credit notes were rejected because they were issued just before insolvency.

Does anyone know the legal basis for this? Something like credit notes get invalidated if made within 3 months of insolvency? But the invoices do not get invalidated?.. Is there any way to combat this? I imagine a large number of ATL contractors are about to face this problem - well, those "lucky" enough to get credit notes in the first place.

I am 99% certain that if the customer pays the invoices I will see nothing.

jeeves wrote:

I'd get some legal assistance on that issue. I think it would be wise to expect a certain amount of scare-mongering from these folks, even if it has no basis in the law whatsoever. Should be fairly easy for an IP-pracitioner or a solicitor to establish. Get someone to write them and explain what contractual or legal obligations they are making that claim on and let them know that, if the claim is unsubstantiated, they will be hearing further from your solicitor.

ATL_Victim wrote:

I was somewhat happy in that I managed to get credit notes from Albany Technologies in January for outstanding invoices for November and December. The administrators just faxed my customer to advise the credit notes were rejected because they were issued just before insolvency.

Does anyone know the legal basis for this? Something like credit notes get invalidated if made within 3 months of insolvency? But the invoices do not get invalidated?.. Is there any way to combat this? I imagine a large number of ATL contractors are about to face this problem - well, those "lucky" enough to get credit notes in the first place.

I am 99% certain that if the customer pays the invoices I will see nothing.

Yes, get legal help and if you are working abroad and the Albany Technologies contract is to be settled on different than UK court ( like mine is ) get local legal assistance.
So even it would be legal as administration act in English courts, it might not stand a change in a another country.

Certainly Phoenix, it appears that there have been some rather spurious undertakings in the background which would seem to ensure that the funds get sucked back in to Albany Holdings / RBS IF in the event of a collapse, leaving the contractors out in the cold even though ATL did *not* use invoice factoring.

Whilst I do not have any funds outstanding with ATL at present (because credit notes allowed my customer to not fill the invoices), if my customer is forced to pay I will indeed become a creditor. I imagine that over the next few days many more ATL contractors will join me in this situation. It would probably be more sensible for us to engage legal representation as a group, as it will probably be substantially cheaper.

If others are interested in joining me, please say so. Then we can set up a private mail group to make the preparations.

Did your customer already paid you directly ?
This is a very bad info.
I'll fight for this money.

My client had not paid me direct for the credit-noted periods, no, I think because they were worried about administrators becoming involved. ie. clearly there is some legal weight behind their refuting the credit notes. That is, it would appear to an insolvency practitioner like the company was off-loading its assets elsewhere immediately before insolvency.

Anyone else aware of their agency or client being contacted the the ATL administrators to demand payment for unpaid but credit-noted invoices?

ATL_Victim,

Did you get any further with this? I don't have a credit note but my agency is still blocking my December pay to ATL. It looks certain that anything CBW receive will go straight to RBS and I'll never see a penny. I've seen several comments about letters from CBW voiding credit notes. Has anyone found out if there is a legal option to try and safeguard this money with or without a credit note or is it checkmate to CBW?

I am taking advice from a law firm specialising in insolvency law in my local country. Shall revert as I have more..

yobwoc wrote:

I don't have a credit note but my agency is still blocking my December pay to ATL.

I'm in your situation and of course I'm not a lawyer and know of no 'legal' way to get out of the mess.

But, if you are lucky, you may be in a position to frustrate the Administrators if, for example, the client were to find the work for which you billed 'sub-standard'. Depending on your contract, they may be within their rights to refuse to pay for said work, in those circumstances, until you have remedied any shortcomings.

And why exactly would you be willing to fix any work for which you are sure you'll never get paid? Who knows, they may even be willing to cut you a deal rather than drag your client to court, if they feel they have drawn enough flesh and blood from you already.

Just a thought, which like in my case, probably doesn't get you anywhere.

On another note, which highlights the unfairness of it all, my salary should have hit my account yesterday. So If I didn't know that my carcase was on the menu at the feast, I do now.

Does anyone knows whether an Administration Order has been issued by a Court in the UK prior taht administrators where appointed (Feb 10) ?
This could make the difference ...
If such, administrators could not cancel the credit notes (I hope so).

the agency I work with has recieved begin of february a credit note for the december invoice. Now the administrators are claiming the invoice of december and are cancelling the credit note. I see that some people are in the same situation and I'm wondering if the administrators do have the right to cancel the credit note issued before their appointment.

Can someone tell me when Albany went into administration?

Administration was February 10th. What date was your credit note?

My credit note date is 09/02/2010. Can the administrators recall this credit note?

NeedSolution wrote:

My credit note date is 09/02/2010. Can the administrators recall this credit note?

Similar for me... They request the client to pay for December invoice which was credited by credit note with date 08/02/2010.
On top of that I have mutually terminated the contract with ATL beginning of February (termination date 01/12/2009)... So even ATL get paid from final client I will NEVER get paid from ATL since I don't have any contract with ATL for that month... Absurd, annoying, frustrating? Y E S.
Final client is not in UK and its contract with ATL mentions clearly that court of Justice in case of any dispute/disagreement/etc would be the country of final client.
Can they still request the credited invoice to be paid?
Can administrators go so far?
Any idea folks?

Why did your client pay ATL if the contract had been terminated? Presumably invoices would only have been raised on the back of timesheets sent to Albany; did you send timesheets to Albany for that period?

I think the problem is that if the administrators view that ATL was trading whilst insolvent (as looks likely), any credit notes raised duting that period are invalid. You should seek legal advice on this though.

Ex-Albany Employee wrote:

Why did your client pay ATL if the contract had been terminated? Presumably invoices would only have been raised on the back of timesheets sent to Albany; did you send timesheets to Albany for that period?

I think the problem is that if the administrators view that ATL was trading whilst insolvent (as looks likely), any credit notes raised duting that period are invalid. You should seek legal advice on this though.

I sent the December timesheets to ATL and December invoice also. ATL sent its invoice to end-client. Those happened mid January.
A couple of weeks later me and ATL agreed for mutual termination of the contract as of 01/12/2009 (Original contract end-date was 31/12/2009). So I sent credit note to ATL and ATL sent its credit note to end-client. I have an official paper for mutual contract termination with ATL allowing me to contact directly end-client if I wanted to do so.
End-client signed a new contract with me including December and paid me.
Now end-client is requested from ATL administrators to pay a credited invoice which is not paid yet to ATL.
What do you think it should/could happened?

What date was the credit note raised by ATL?

It is very unfair though, I know that a number of credit notes were pushed through by Albany staff trying to assist contractors in the final days only for the administrator to declare them invalid shortly afterwards.

Ex-Albany Employee wrote:

What date was the credit note raised by ATL?

It is very unfair though, I know that a number of credit notes were pushed through by Albany staff trying to assist contractors in the final days only for the administrator to declare them invalid shortly afterwards.

Credit note issued with date 08/02/2010 so 2 days before administration.
I have terminated the contract with ATL as of 01/12/2009 (contract would ended originally on 31/12/2009) so the dispute here is ONLY for the last month of the contract.
End-client has already paid that invoice (not to ATL but to me through the new contract). What happens if end-client refuses to pay? Are CBW going to chase the end-client and go to the court of Justice? Is there any chance for administrators to win such a case in the court (which is not UK by the way) where there exist a mutually contract termination and credit note prior to administration date?

So your client has paid you direct for the last month of your contract?

If the administrator sees the credit note as invalid, as far as they are concerned your client remains a debtor of ATL and the invoice will need to be paid. I would imagine that they will pursue them for this but I don't know to what degree.

I really have no idea if they would win a court case based on this or if it would even get that far. You / your client would need to get legal advice on this.