The former boss of one of Shropshire’s largest building firms has launched legal action against the company claiming £640,000 amid allegations he was forced to resign.
David Alexander, the former managing director of Frank Galliers Holdings Ltd, says that he was forced to act illegally and make inappropriate payments to the company’s owners George Butler and Kevin Connolly, of Pan Atlanta Developments.
Solicitors acting for Mr Alexander have served a High Court writ against the two men as well as the Galliers Group of Companies, which is owned by Pan Atlanta.
Today Mr Alexander said that he did not wish to comment because of the ongoing court proceedings.
According to the 31-page writ filed at the High Court, Mr Alexander claims he was forced to resign because of the actions of Mr Butler and Mr Connolly, without being properly paid all his entitlements.
He says the “final straw” came when he was ordered to pay an invoice to solicitors at a time when the financial position of the company was so tight that auditors had “expressed concern”.
The claim states that Mr Butler and Mr Connolly had been required to agree that no money would be taken from the company over and above an agreed cash flow projection and the invoice was for work that did not relate to company business.
Mr Alexander, who was paid an annual salary of £80,000 plus an annual bonus, resigned on January 30, 2007.
He has accused the two directors of purchasing two Jaguar cars through the company for their personal use using unbudgeted money.
In November 2004, he claims he was told to pay £3,000 a month to both men in unbudgeted salary payments. He alleges he was also told to alter the accounts so salaries paid to Mr Butler and Mr Connolly were shown as payments for plants and machinery.
Mr Alexander claims the two men placed “significant restrictions” on him selling a development in Shrewsbury to a third party so Mr Butler and Mr Connolly could buy it for themselves at cost for their own personal use.
The pair are also accused of falsifying board minutes for their own advantage for meetings which were either never held or from which Mr Alexander was excluded.
They allegedly switched banks to get around a legal covenant to personally pay back money to the vendors following the sale of Galliers to Pan Atlanta.
During this period, the company’s formal overdraft limit expired, which meant the Bank of Scotland was unable to pay “items presented for payment”. The claim states that for a company spending more than £1.5million a month this situation was “indicative of insolvency”.
They are also accused of using correction fluid to change bank authorisation forms to stop Mr Alexander being able to issue cheques of an unlimited amount. The alteration reduced his authority to £100,000.
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