Frank Leggett interviewed Richard Edwards of Whites Legal about how to recover if your restaurant or cafe goes into administration.
Administration (and winding up and liquidation) is a serious event, as is bankruptcy. But it’s not the end of the world.
“A personal guarantee makes the directors liable for those debts,”
“The creditor can normally go after the guarantor directly and immediately.
“Not only are you looking at a minimum of three years of being bankrupt but your name is permanently listed on the National Personal Insolvency Index.”
“Then there are bad credit reports that hang around for four or more years. Your name is also going to pop up on Google whenever anyone does a search.”
As Richard Edwards says, “The most important thing to remember is that if it doesn’t work on a spreadsheet, it doesn’t work in real life.”
Frank also spoke with Ken Burgin from Profitable Hospitality, David Bergman from at the Australian Financial Security Authority (the government side of bankruptcy) and Justin North of the former Bécasse.
You can read the full article, “Lessons Learnt” in the September 2016 edition of Restaurant & Catering Magazine and on Restaurant & Catering Magazine’s website.