Purpose

Following approval by the Executive on 7 January 2020, Legal Services Lincolnshire (Trading) Limited, Company number 12521124 ("the Company") was established as a wholly owned company of the Council to operate as an Alternative Business Structure ("ABS"). The Company was established to provide a vehicle through which the Council’s Legal Service could undertake legal work for external clients and partner organisations which are effectively part of the public and not sufficiently connected to the Council. Staff are made available to the ABS where necessary to work for clients whose services can only be provided by the ABS due to regulatory restrictions. The ABS thereby enables property legal work to be undertaken for Lafford Homes Ltd, a company created by North Kesteven District Council. Since its establishment, the operational need for the Company has diminished significantly. A review of the Company’s activities, workload and future requirements has concluded that

there is no longer a strategic or operational justification for maintaining the ABS. The volume of work undertaken through the Company has diminished and the remaining active matters are limited in nature. The Company's current activities consist primarily of managing and concluding a small number of matters arising from the Lafford workstream and other legacy instructions which are nearly completed pending land registration with HM Land Registry or upon which there has been little progress. As of 15th July 2026, the Company has seventeen open matters remaining with at least ten due for closure shortly. Limited legal work for Greater Lincolnshire Combined County Authority (GLCCA) has also been undertaken by the ABS via a Service Level Agreement (SLA) which is part of GLCCA’s overarching Services Agreement between GLCCA and its constituent councils. The SLA requires three months’ notice of termination, unless agreed otherwise. A mutually acceptable notice period should be agreed with GLCCA, following which any future legal work for GLCCA can be undertaken directly by the Council’s Legal Service, which is permitted by regulations, GLCCA being a public body and sufficiently connected with the Council. Following approval of this decision a reasonable period of notice should be provided to Lafford Homes and arrangements made to ensure that all remaining Company matters are appropriately concluded, transferred or otherwise finalised before the Company is dissolved prior to the end of this financial year. The Directors propose to implement an orderly wind down of the Company's affairs. This will include the conclusion of existing matters, collection of outstanding fees, discharge of liabilities and completion of any remaining regulatory, accounting and administrative obligations. Once all active matters have been concluded and the Company has ceased carrying on business, a period of at least three months must elapse during which the Company undertakes no trading activity other than actions necessary for the purpose of closure. Following that period, an application will be made to Companies House for voluntary strike off under section 1003 of the Companies Act 2006.

Lincolnshire County Council is the sole shareholder of the Company. Under Clause 5.2 and Schedule 6 of the Company Shareholders' Agreement, the commencement of any winding up, dissolution or analogous process constitutes a matter requiring the prior written consent of Lincolnshire County Council as shareholder. This officer decision will therefore provide the necessary shareholder approval for the Directors to commence and implement the proposed wind down and strike off process of the Company. Termination of the Company’s Shareholder Agreement requires no less than 6 months’ notice to be given between the Parties but both the Council and Company Board can agree via a short Deed to formally waive this notice period. The proposed approach is the most proportionate and cost-effective means of bringing the Company's affairs to an orderly conclusion. The Company is solvent and all liabilities, obligations and regulatory requirements should be capable of being satisfied prior to any application for strike off. As a result, there is no requirement to undertake a formal insolvency process. A Members' Voluntary Liquidation would require the appointment of a licensed insolvency practitioner and the payment of associated professional fees. In circumstances where the Company has ceased trading, has a limited number of residual matters and is expected to be capable of settling all liabilities before dissolution, the use of the voluntary strike off process represents a more efficient use of public resources whilst still ensuring compliance with applicable legal and governance requirements. This matter is considered suitable for determination by way of an Officer Statement of Decision under delegated powers. The work undertaken through the Company is now limited and the proposed closure will not have a material effect on the delivery of Council services. Rather, the decision concerns the exercise of the Council's rights and responsibilities as sole shareholder in relation to a company that has largely completed its operational purpose. The decision will enable the Company to conclude its remaining activities, avoid unnecessary ongoing governance and compliance costs and ensure that public resources are used efficiently whilst maintaining compliance with the Company's constitutional documents and applicable company law requirements

Decision

To approve 1. The cessation of activities of Legal Services Lincolnshire (Trading) Limited ("the Company”) as soon as reasonably practicable; 2. That Lincolnshire County Council, as sole shareholder, give its prior written consent to the Company's dissolution and strike off process, such process to be completed no later than 31st March 2027.

Alternative options considered

Retain the Company Retaining the Company as a dormant or inactive entity was considered. This option was rejected as it would continue to require ongoing governance, regulatory and administrative compliance, including annual Companies House filings, accounting requirements and shareholder oversight, without delivering a corresponding operational benefit to the Council. Retention of the Company would also create ongoing costs and officer resource commitments for an entity that is no longer required for service delivery. Members' Voluntary Liquidation The Council considered whether the Company should be placed into a formal members' voluntary liquidation. Whilst this would provide a structured mechanism for bringing the Company's affairs to an end, it would require the appointment of a licensed insolvency practitioner and the payment of associated professional fees. Given that the Company is solvent, has a limited number of residual matters and is expected to be capable of settling all liabilities before dissolution, this option is not considered proportionate or cost effective. Company Strike Off The preferred option is to cease trading activities, complete or transfer the remaining matters, ensure all liabilities and obligations have been discharged, maintain the required period of non-trading activity and then apply to Companies House for voluntary strike off under section 1003 of the Companies Act 2006. This provides the most proportionate, efficient and cost-effective means of bringing the Company's activities to an orderly conclusion whilst ensuring compliance with its legal, regulatory and governance obligations.