Difficult development

A client development company has problems in the present credit crunch. They have two developments; the first has five completed flats of which one was sold in November 2007 for £240 000 but the others are not shifting. The second is a large house which is nearly completed and should be finished once one of the directors loans another £30 000 to the company.

The directors are considering whether the company should be dissolved. To achieve this I thought of making an application under ESC C16 and in accordance with the directors' wishes distributions of the assets would then be made in specie with each individual director/shareholder taking over one half of the company's borrowings. Each director holds one issued share in the company.

The value of the unsold flats is estimated as £800 000 and these are proposed to be distributed to one director with...