Official Receiver v Wild

The Official Receiver brought a directors' disqualification claim under the Company Directors Disqualification Act 1986, section 6. The court found that Mr David Wild was the sole director of three insolvent companies which sold holiday‑club memberships and that his conduct made him unfit to be concerned in the management of a company. Key findings were that the companies used aggressive, high‑pressure sales techniques, sought to circumvent a provisional liquidator by continuing the business through successor companies with similar names, misused intellectual property and failed to provide customers with the contracted benefits. Applying the statutory test and relevant authorities, the judge concluded that disqualification was mandatory and that a nine‑year disqualification was appropriate.

This was a first‑instance Part 8 claim by the Official Receiver for the disqualification of Mr David James Wild, the sole director and shareholder of three related companies (APD Leisure & Marketing Limited; APD Leisure Group Limited; and APD Leisure & Marketing Group Europe Limited) that were wound up on public interest petitions. The Official Receiver relied on conduct said to make Mr Wild unfit under section 6 of the Company Directors Disqualification Act 1986. The principal factual findings were:

• the companies sold holiday‑club memberships using aggressive sales presentations and inducements to secure on‑the‑day commitments, depriving customers of time to reflect and potential consumer protections;
• there was misrepresentation about availability of holidays, particularly at popular periods such as school holidays, and failures to provide services customers had paid for;
• Leisure & Marketing used or sought to use Sunterra/Diamond names and logos without entitlement and incorporated companies bearing those names, a practice the court found intended to mislead customers;
• after appointment of a provisional liquidator to Leisure & Marketing, business and sales continued through successor companies with similar names, thereby circumventing the provisional liquidator and earlier court orders;
• each company was insolvent at the time of liquidation: they had no assets and there were potential claims from customers and other creditors.

The issues framed were (i) whether each company was insolvent for the purposes of section 6(1) and (ii) whether Mr Wild's conduct rendered him unfit to be involved in company management, with reference to Schedule 1 and section 9(1) of the 1986 Act and the standard of conduct derived from Companies Act 2006 s.174. The court accepted the Official Receiver's evidence and unchallenged customer affidavits and rejected Mr Wild's explanations about the trademark purchases and the alleged benign reasons for the trading practices. The court applied a broad‑brush, value‑judgment approach to fitness, having regard to aggravating and mitigating features, and concluded that the case fell at the top end of the middle bracket of disqualification periods. The court therefore made a disqualification order for nine years.

The court made a directors' disqualification order against Mr David Wild for nine years. The judge held that each company was insolvent when wound up and that Mr Wild's conduct — including aggressive sales techniques, misleading use of third‑party names/logos, continuation of trading after appointment of a provisional liquidator by using successor companies, and failure to provide contracted services — rendered him unfit under section 6 of the Company Directors Disqualification Act 1986. Having weighed aggravating and mitigating features, the disqualification period was fixed at nine years.