FAQs
What notification will be provided to creditors who are owed money?
The Joint Liquidators will write to all known creditors of the Company, based on the creditor lists provided by the previous administrators or who have otherwise come to the Joint Liquidators’ attention. This notification will explain how to submit a claim and will also include a notice that, where permitted, future documents for creditors will be made available on a case website rather than being sent by post or email.
What type of creditor am I?
Creditors are classified as to the type of claim they have, these types will determine the quantum of distribution they will receive as the funds for each type is ring fenced.
The three main types of creditor are:
• Secured;
• Preferential; and
• Unsecured
Secured creditors have security registered at Companies House. When they have a fixed/standard charge over an asset, the secured creditor will be paid out of the realisations from that specific asset, after the costs of realisation have been deducted. When they have a floating charge over an asset, the secured creditor will be paid out of the realisations from those assets, after the costs of realisation and other expenses of the insolvency procedure, the preferential creditors (see below) have been paid in full and the prescribed part (see below) has been set aside.
Preferential creditors primarily consist of employees for arrears of wages, accrued holiday pay, unpaid contributions to occupational pension schemes and state scheme premiums, all within certain limits. As of December 2020 this will also include certain aspects of HMRC’s claim, these claims will rank as secondary preferential claims (paid after the preferential element of the employee claims) and consist of the VAT, PAYE and NIC deductions. Preferential creditors rank ahead of all other creditors when realisations are achieved from assets where there is no fixed charge registered.
Unsecured creditors are all other unsecured and non-preferential creditors (with the exception of shareholders/members). These are usually the normal “trade” creditors. They rank below preferential and secured creditors, with the exception of when the prescribed part is applicable (see below).
Shareholders / members will be the last class of creditor to receive a distribution and they will only receive a distribution after everyone else has been paid in full.
What is the prescribed part?
When a secured creditor has a floating charge registered after 15 September 2003, a proportion of the funds available to them is set aside for distribution to unsecured creditors. This is the prescribed part.
The prescribed part applies in this case as there is a floating charge created after 15 September 2003. The amount of the prescribed part is:
• 50% of net property up to £10,000
• 20% of net property above £10,000
• Subject to a maximum of £800,000
Insolvency legislation sets out how the prescribed part is calculated and if it is applicable, further details will be provided in our progress reports to creditors.
What further information and reporting will be provided?
The Joint Liquidators have already written to all known creditors to notify them of the liquidation appointment. Any new creditors coming to our attention will also receive written notification from us.
We will publish progress reports to the case website. The Joint Liquidators are required to provide written updates at least every 12 months, and these reports will be made available on the case website within two months of each anniversary. Creditors have the right to elect to opt out of receiving certain documents, without affecting any entitlement to dividends; further details on opting out will be provided in our initial letter.
How can a creditor submit a claim (proof of debt)?
To submit a claim, a creditor should complete a Proof of debt form and provide evidence of entitlement, such as a receipt from the Company or a bank statement if the receipt is unavailable.
For repair-related claims, evidence that the device was within warranty should be provided.
Claims should be submitted by email to: uk_a1commsenquiries@pwc.com. Proofs of debt forms were sent out with our initial notice of the liquidation but are also available to download from the case website, should a creditor wish to submit a claim at this stage.
Will the costs of preparing a claim be refunded?
No. The estate is unable to refund the costs of preparing a claim or any expenses incurred in obtaining information necessary to make a claim.
What is the estimated timeframe for reviewing claims and paying any dividend?
The liquidation process is complex and requires time to assess the Company’s position before an estimate can be provided on the value or timing for claim reviews and any distribution. Updates on dividend prospects and any timeframe, where possible, will be included in the Joint Liquidators’ annual reports. At present, it is anticipated there will be a dividend for unsecured creditors, but the timing and quantum is still uncertain.
Will unsecured claims be admitted and paid?
Claims are recorded as unsecured and payment is not guaranteed; any dividend will only be made if there are sufficient realisations in the insolvency estate and is likely to be a proportion of the claim, rather than payment in full. The Joint Liquidators will provide updates on dividend prospects in progress reports issued approximately every 12 months in their progress reports.
Who should address questions about cancelling airtime contracts or other contract issues?
Although the Company sold devices and arranged plans, airtime contracts are between customers and their network providers (eg.O2, Vodafone, Three etc). Cancellation and contract-related queries must be directed to the relevant network provider, and payments to the network provider should continue as normal.
Can the Joint Liquidators remove a default notice from a personal credit file?
No. Default notices are registered by network/airtime providers, not by the Company. Any request concerning a default notice should be directed to the relevant network/airtime provider that registered it.
What options are available if a device is faulty and needs repair?
Warranties and service agreements are typically NOT provided when a company enters liquidation and ceases trading. Customers may need to seek alternative solutions or contact the manufacturer directly if the device is covered by a manufacturer’s warranty. If the device is within warranty and repair costs or other losses (such as lost airtime) are incurred, a proof of debt with supporting evidence may be submitted for consideration to the Joint Liquidators. This, if accepted, would rank as an unsecured claim against the Company. The level and timing of a dividend anticipated for unsecured creditors is uncertain.
Can you provide my device’s IMEI number?
Without liability and based on the Company’s available information, the Joint Liquidators may be able to confirm the IMEI number held for a device, although access to historic systems may be limited.
Can copies of invoices, VAT receipts, or proofs of purchase be provided?
Due to the insolvency and lack of access to historic sales records, the Joint Liquidators are unable to provide copies of invoices, VAT receipts, or proof of purchase for prior orders.
Who should be contacted regarding recent order queries?
Recent order queries should be directed to Affordable Mobiles Limited at care@affordablemobiles.co.uk.
General queries should be sent to: uk_a1commsenquiries@pwc.com.
