Re-registration of a company as another company type in the course of legal proceedings - Start Mortgages v Kavanagh

In Start Mortgages v Kavanagh [2019] IEHC 216,  the High Court confirmed that, where legal proceedings had commenced, it was not necessary for a company to make a formal application to court to reflect its change in status from a limited liability company to a designated activity company under the Companies Act, 2014. 

The point arose in the course of proceedings taken by Start Mortgages for possession of the defendants' property, in the course of which the plaintiff converted from an old limited company to a designated activity company, prior to the end of the transitional period for conversion of companies pursuant to Part 2 of the 2014 Act.  

The plaintiff then got an ex parte order amending the title of the proceedings, to reflect the conversion. The defendants tried to set aside that order, on the basis that the reconstituted company was a "new company",  and that the plaintiff's security interest was registered in its old configuration.

Simons J considered s.63(12) of the 2014 Act, and held that because this subsection states that proceedings may be "continued" by or against the company in its new status, and because the identity of the plaintiff remained the same, it was not necessary for it to make a formal application to court to reflect its change in status from a limited liability company to a designated activity company, but that it could do so if it wished to copper-fasten its position.

Comment

While the re-registration procedure under Part 2 of the 2014 Act has now expired with the ending of the transitional period for conversion of companies under the Act, the decision is nevertheless helpful because companies can still re-register as another company type under Part 20 of the Act, and a similar provision is contained in that Part (section 1285 (9)) to that set out in section 63 (12). 

For more information on this topic please contact Jack O'Farrell, Consultant or any member of A&L Goodbody's Corporate and M&A team.

Date published: 26 April 2019