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Re Ipagoo LLP (in administration) (9 March 2022)
The Court of Appeal, Civil Division, dismissed both the appeal and the cross-appeal against the decision of the Chancery Division. The appeal and cross-appeal were concerned with the proper construction of the Electronic Money Regulations 2011, SI 2011/99 and, in particular, with the status of funds received by an electronic money institution from electronic money holders in the event of its insolvency. The court held, among other things, that ... View
The Court of Appeal, Civil Division, dismissed both the appeal and the cross-appeal against the decision of the Chancery Division. The appeal and cross-appeal were concerned with the proper construction of the Electronic Money Regulations 2011, SI 2011/99 and, in particular, with the status of funds received by an electronic money institution from electronic money holders in the event of its insolvency. The court held, among other things, that ... View
Re Corbin & King Holdings Ltd and other companies (17 February 2022)
The Chancery Division dismissed the applicant secured creditor's (MHG's) application, pursuant to ss A38 and A42 of the Insolvency Act 1986 (the Act), for orders terminating a moratorium entered into by intermediate holding, operating and asset owning companies (the OpCos), pursuant to Pt A1 of the Act. The Corbin & King group (the Group) operated restaurants in London and one in Bicester Village. Corbin & King Ltd (TopCo) was the ultimate parent company of the Group. MHG had provided TopCo's working capital through: (i) a £14.25m facility; and (ii) a £20m loan (together, the loan). The OpCos had guaranteed the loan, which had also been secured by a debenture granted by TopCo. TopCo defaulted on the loan and the OpCos entered into the moratorium under Pt A1 of the Act ... View
The Chancery Division dismissed the applicant secured creditor's (MHG's) application, pursuant to ss A38 and A42 of the Insolvency Act 1986 (the Act), for orders terminating a moratorium entered into by intermediate holding, operating and asset owning companies (the OpCos), pursuant to Pt A1 of the Act. The Corbin & King group (the Group) operated restaurants in London and one in Bicester Village. Corbin & King Ltd (TopCo) was the ultimate parent company of the Group. MHG had provided TopCo's working capital through: (i) a £14.25m facility; and (ii) a £20m loan (together, the loan). The OpCos had guaranteed the loan, which had also been secured by a debenture granted by TopCo. TopCo defaulted on the loan and the OpCos entered into the moratorium under Pt A1 of the Act ... View
Re JD Group Ltd Hall (as liquidator of JD Group Ltd) v Bhatia (18 February 2022)
The Chancery Division allowed the applicant liquidator's claim in proceedings concerning a company that had been placed in creditors voluntary liquidation. The court held that the defendant (DB), who had been the effective sole director of the company, had been liable in dishonestly causing the company's participation in a missing trader intra community VAT fraud, as well as fraudulent breach of duty. The court held that it was appropriate to award the loss claimed on the basis of s 212 of the Insolvency Act 1986. View
The Chancery Division allowed the applicant liquidator's claim in proceedings concerning a company that had been placed in creditors voluntary liquidation. The court held that the defendant (DB), who had been the effective sole director of the company, had been liable in dishonestly causing the company's participation in a missing trader intra community VAT fraud, as well as fraudulent breach of duty. The court held that it was appropriate to award the loss claimed on the basis of s 212 of the Insolvency Act 1986. View
Re Preston; Preston v Beaumont and another (8 February 2022)
The Chancery Division dismissed the appellant's appeal against the decision of the Country Court that adjudged the appellant bankrupt. The court held, among other things, that: (i) the judge was not wrong to treat the first hearing as anything other than a directions hearing, with the opposed petition to be heard on a future date; (ii) the judge did not fail to act in accordance with minimum expectations of due process; (iii) the judge was not wrong to conclude as a matter of principle that an opposition to a bankruptcy petition should not be considered where there had already been a determination of an application to set aside a statutory demand, even if the grounds were not ones previously taken at the demand stage; and (iv) the judge was not wrong to conclude that the grounds of opposition were an abuse of process because a number of the grounds could only be raised at the petition stage. View
The Chancery Division dismissed the appellant's appeal against the decision of the Country Court that adjudged the appellant bankrupt. The court held, among other things, that: (i) the judge was not wrong to treat the first hearing as anything other than a directions hearing, with the opposed petition to be heard on a future date; (ii) the judge did not fail to act in accordance with minimum expectations of due process; (iii) the judge was not wrong to conclude as a matter of principle that an opposition to a bankruptcy petition should not be considered where there had already been a determination of an application to set aside a statutory demand, even if the grounds were not ones previously taken at the demand stage; and (iv) the judge was not wrong to conclude that the grounds of opposition were an abuse of process because a number of the grounds could only be raised at the petition stage. View
Re AFM (1932) Ltd (in liquidation) AFM (1932) Ltd (in liquidation) and others v Belisco Estates Ltd and another (21 December 2022)
The Chancery Division (Companies Court) found that the liquidator's application under s 238 of the Insolvency Act 1986 (IA 1986), alleging a transaction at an undervalue, could not succeed. The s 238 claim referred to the benefit gained by the first respondent company of having the first applicant (in liquidation) pay for work and supplies for a property, without reimbursement. Although the arrangement had fallen within the statutory definition of 'transaction' in IA 1986 s 436(1), the transaction was only at an undervalue if the first applicant was not to be reimbursed for the payments. The issue for the claim was that the first applicant was entitled to be reimbursed. The real problem was the first respondent's breach of its obligation to reimburse rather than the arrangement being a transaction at an undervalue. View
The Chancery Division (Companies Court) found that the liquidator's application under s 238 of the Insolvency Act 1986 (IA 1986), alleging a transaction at an undervalue, could not succeed. The s 238 claim referred to the benefit gained by the first respondent company of having the first applicant (in liquidation) pay for work and supplies for a property, without reimbursement. Although the arrangement had fallen within the statutory definition of 'transaction' in IA 1986 s 436(1), the transaction was only at an undervalue if the first applicant was not to be reimbursed for the payments. The issue for the claim was that the first applicant was entitled to be reimbursed. The real problem was the first respondent's breach of its obligation to reimburse rather than the arrangement being a transaction at an undervalue. View
Hull v Liddiment and another (17 December 2022)
The Business and Property Courts, dismissing the appellant freeholder owner's appeal, held that the Deputy Master had not erred in refusing to grant an adjournment and ordering possession of the land pursuant to s 36 of the Administration of Justice Act 1970. View
The Business and Property Courts, dismissing the appellant freeholder owner's appeal, held that the Deputy Master had not erred in refusing to grant an adjournment and ordering possession of the land pursuant to s 36 of the Administration of Justice Act 1970. View
McLinden v Lu (26 November 2021)
The Chancery Division, ruling on preliminary issues, held, among other things, that a petition presented by the defendant against an individual (K) had not been defective and that there had not been any material non-compliance with s 269(1)(b) of the Insolvency Act 1986. The preliminary issues arose in circumstances ... View
The Chancery Division, ruling on preliminary issues, held, among other things, that a petition presented by the defendant against an individual (K) had not been defective and that there had not been any material non-compliance with s 269(1)(b) of the Insolvency Act 1986. The preliminary issues arose in circumstances ... View
Williams v Nilsson and another (25 November 2021)
The Administrative Court granted the appellant's applications for permission: (i) to appeal against the judge's decision to grant the respondents, who were her bankrupt ex-husband's trustees in bankruptcy, orders for possession and sale of the property she had owned with the bankrupt in order to realise the bankrupt's 50% interest in the property; and (ii) to rely upon new evidence (in the form of a transcript of a financial remedy hearing the appellant and the bankrupt) in support of that appeal. The court held that on balance, there had been an agreement made between the appellant and the bankrupt that any appreciation in the value of the property after he had moved out and before the property had been sold would belong to the appellant. In making that finding, significant weight was attached to the transcript which fully corroborated the appellant's claim of such an agreement being made. View
The Administrative Court granted the appellant's applications for permission: (i) to appeal against the judge's decision to grant the respondents, who were her bankrupt ex-husband's trustees in bankruptcy, orders for possession and sale of the property she had owned with the bankrupt in order to realise the bankrupt's 50% interest in the property; and (ii) to rely upon new evidence (in the form of a transcript of a financial remedy hearing the appellant and the bankrupt) in support of that appeal. The court held that on balance, there had been an agreement made between the appellant and the bankrupt that any appreciation in the value of the property after he had moved out and before the property had been sold would belong to the appellant. In making that finding, significant weight was attached to the transcript which fully corroborated the appellant's claim of such an agreement being made. View
Walker v Official Receiver (as trustee in bankruptcy of Martin Walker) (26 October 2021)
The Chancery Division granted the appellant leave to bring an application for compensation from the respondent Official Receiver pursuant to s 304 of the Insolvency Act 1986. Following the appellant's bankruptcy, the Official Receiver had sold land in which the appellant had a one-third beneficial interest, which it had no authority to sell as the legal title in the land had remained vested in the appellant as trustee of the land. Accordingly, the Chancery Division concluded the appellant had a reasonably meritorious claim for compensation from the Official Receiver. View
The Chancery Division granted the appellant leave to bring an application for compensation from the respondent Official Receiver pursuant to s 304 of the Insolvency Act 1986. Following the appellant's bankruptcy, the Official Receiver had sold land in which the appellant had a one-third beneficial interest, which it had no authority to sell as the legal title in the land had remained vested in the appellant as trustee of the land. Accordingly, the Chancery Division concluded the appellant had a reasonably meritorious claim for compensation from the Official Receiver. View
Re Amicus Finance plc (in administration) (15 November 2021)
The Chancery Division approved a scheme of arrangement concerning Amicus Finance plc, which was in liquidation. The core business of Amicus was the provision of short-term property finance. It also offered other secured corporate and development finance and, through its subsidiaries, also operated in specialist fields, including asset finance. The court held that the criteria for sanctioning the scheme had been met, and that it was appropriate for it to use its discretion to sanction the scheme. View
The Chancery Division approved a scheme of arrangement concerning Amicus Finance plc, which was in liquidation. The core business of Amicus was the provision of short-term property finance. It also offered other secured corporate and development finance and, through its subsidiaries, also operated in specialist fields, including asset finance. The court held that the criteria for sanctioning the scheme had been met, and that it was appropriate for it to use its discretion to sanction the scheme. View
Re A Company (Preliminary Hearing Under Schedule 10 to the Corporate Insolvency and Governance Act 2020) (11 November 2021)
The Chancery Division dismissed the petitioner's petition to wind up the respondent company. The proceedings arose from a development project which the petitioner had funded, which had stalled during the lockdown during the coronavirus pandemic. The court held that it was more likely than not that, but for the pandemic, the company would have been in a position to refinance the project and repay the debt owed to the petitioner. As a result, the company had passed the threshold test in para 5(1) of sch 10 to the Corporate Insolvency and Governance Act 2020. View
The Chancery Division dismissed the petitioner's petition to wind up the respondent company. The proceedings arose from a development project which the petitioner had funded, which had stalled during the lockdown during the coronavirus pandemic. The court held that it was more likely than not that, but for the pandemic, the company would have been in a position to refinance the project and repay the debt owed to the petitioner. As a result, the company had passed the threshold test in para 5(1) of sch 10 to the Corporate Insolvency and Governance Act 2020. View
Re Dealmaster Ltd Richmondshire District Council v Dealmaster Ltd and another (1 November 2021)
The Business and Property Courts, dismissed the application of the creditor. The creditor had sought the revocation or suspension of approval of a creditors' voluntary arrangement in respect of the first respondent company on the basis that a different valuation of the relevant property owned by the company should have been taken into account. The court held that the applicant would not have been in a significantly better position in a liquidation as claimed, nor had it been subject to unfair prejudice as a result of the CVA. View
The Business and Property Courts, dismissed the application of the creditor. The creditor had sought the revocation or suspension of approval of a creditors' voluntary arrangement in respect of the first respondent company on the basis that a different valuation of the relevant property owned by the company should have been taken into account. The court held that the applicant would not have been in a significantly better position in a liquidation as claimed, nor had it been subject to unfair prejudice as a result of the CVA. View
Hughes and another v Howell (6 July 2021)
The Court of Appeal, Civil Division, dismissed the appellant debtor's appeal from a bankruptcy order on the ground that the appellant had not made an offer to provide security over the debt that was sufficient to show that the respondent creditors' refusal of that offer had been unreasonable because a creditor was not unreasonable in refusing to wait for an indeterminate time for an indeterminate amount before the security over the debt could be realised. View
The Court of Appeal, Civil Division, dismissed the appellant debtor's appeal from a bankruptcy order on the ground that the appellant had not made an offer to provide security over the debt that was sufficient to show that the respondent creditors' refusal of that offer had been unreasonable because a creditor was not unreasonable in refusing to wait for an indeterminate time for an indeterminate amount before the security over the debt could be realised. View
Re Inter Global Surgical LLP No. OC371890 Frandsen and others v Mulligan and others (1 October 2021)
The Chancery Division made two orders in the course of proceedings concerning an application to restore a company to the Register of Companies pursuant to s 1029(1) of the Companies Act 2006. First, the court declined to order the restoration of the company's name to the Register. The court could not dispense with issue and service of a claim form on the Registrar of Companies and make a final order disposing of the proceedings before they were issued. Second, in the circumstances, it was just and convenient to appoint receivers on an interim basis. Damages would not be an adequate remedy for either party and, by appointing receivers, their legitimate interests would be protected View
The Chancery Division made two orders in the course of proceedings concerning an application to restore a company to the Register of Companies pursuant to s 1029(1) of the Companies Act 2006. First, the court declined to order the restoration of the company's name to the Register. The court could not dispense with issue and service of a claim form on the Registrar of Companies and make a final order disposing of the proceedings before they were issued. Second, in the circumstances, it was just and convenient to appoint receivers on an interim basis. Damages would not be an adequate remedy for either party and, by appointing receivers, their legitimate interests would be protected View
Re an application for directions by Golden Belt 1 Sukuk Company BSC (c) (in liqui-dation) (as trustee) and another company (30 September 2021)
The Chancery Division held that limitations imposed by sch 3 to a declaration of trust and agency (DTA) on the power of certificate holders to pass resolutions – in particular the limitation that a particular majority was required in order to pass a resolution in relation to reserved matters – did not result in an implied limitation on the trustee's or delegate's powers, trusts, authorities and discretions vested in them by the DTA, in the context of an Islamic financing transaction (the sukuk). The sukuk had an economic effect equivalent to a bond issue, but was structured so as to conform to the principles of sharia law: in particular, the principle that prohibited charging or paying interest. View
The Chancery Division held that limitations imposed by sch 3 to a declaration of trust and agency (DTA) on the power of certificate holders to pass resolutions – in particular the limitation that a particular majority was required in order to pass a resolution in relation to reserved matters – did not result in an implied limitation on the trustee's or delegate's powers, trusts, authorities and discretions vested in them by the DTA, in the context of an Islamic financing transaction (the sukuk). The sukuk had an economic effect equivalent to a bond issue, but was structured so as to conform to the principles of sharia law: in particular, the principle that prohibited charging or paying interest. View
Re Nero Holdings Ltd Young v Nero Holdings Ltd and others (29 September 2021)
The applicant landlord creditor of Nero Holdings Ltd challenged the company voluntary arrangement approved by a creditors' electronic decision procedure on the grounds that a late offer under which landlords would have received their rent arrears in full had been erroneously rejected amounting to a procedural irregularity. The Business and Property Courts, dismissing the application, held that, balancing all the relevant factors and the risks involved, under considerable time pressure and without any clear route for postponing an electronic voting procedure, the conclusion that the nominees had reached was well within the range of what a reasonable nominee could have come to in the circumstances. View
The applicant landlord creditor of Nero Holdings Ltd challenged the company voluntary arrangement approved by a creditors' electronic decision procedure on the grounds that a late offer under which landlords would have received their rent arrears in full had been erroneously rejected amounting to a procedural irregularity. The Business and Property Courts, dismissing the application, held that, balancing all the relevant factors and the risks involved, under considerable time pressure and without any clear route for postponing an electronic voting procedure, the conclusion that the nominees had reached was well within the range of what a reasonable nominee could have come to in the circumstances. View
Re Rhino Enterprises Properties Ltd and another; Schofield and another v Smith and another (22 September 2021)
The Chancery Division ruled on two sets of proceedings, namely: (i) misfeasance proceedings against the first applicant company's former administrators (the respondents) and a claim against Clyde & Co (the C&C claim). In the misfeasance proceedings, the court granted the application by the respondents to strike out the proceedings or grant summary judgment in favour of their favour on the basis that a previous settlement agreement entered into by companies associated with the applicants and Barclays Bank plc had released the former administrators from the claims asserted against them. The court further held that there would either be a striking out and/or summary judgment in favour of C&C as a trial would be necessary to determine whether the alleged breaches asserted against C&C for breach of duty while acting as agents fell within an overall appointment of C&C as 'agents' or not, or were otherwise prevented by the settlement agreement on the facts. View
The Chancery Division ruled on two sets of proceedings, namely: (i) misfeasance proceedings against the first applicant company's former administrators (the respondents) and a claim against Clyde & Co (the C&C claim). In the misfeasance proceedings, the court granted the application by the respondents to strike out the proceedings or grant summary judgment in favour of their favour on the basis that a previous settlement agreement entered into by companies associated with the applicants and Barclays Bank plc had released the former administrators from the claims asserted against them. The court further held that there would either be a striking out and/or summary judgment in favour of C&C as a trial would be necessary to determine whether the alleged breaches asserted against C&C for breach of duty while acting as agents fell within an overall appointment of C&C as 'agents' or not, or were otherwise prevented by the settlement agreement on the facts. View
Serene Construction Ltd v Salata and Associates Ltd (formerly Salata & Co Ltd) and others (2 September 2021)
The claimant company unsuccessfully claimed damages, alleging that the second and third defendant receivers' sale of an unbuilt development site, which had been subject to a fixed charge, had been made in breach of their fiduciary duty to take reasonable steps to achieve the best price available. The Chancery Division, applying settled law, ruled, among other things, that it had not been a breach of duty the receivers to have adopted the marketing strategy that they had, and that, having received an offer of £175,000, it had not been a breach of duty to have accepted that, in the circumstances as had been known to them at the time. View
The claimant company unsuccessfully claimed damages, alleging that the second and third defendant receivers' sale of an unbuilt development site, which had been subject to a fixed charge, had been made in breach of their fiduciary duty to take reasonable steps to achieve the best price available. The Chancery Division, applying settled law, ruled, among other things, that it had not been a breach of duty the receivers to have adopted the marketing strategy that they had, and that, having received an offer of £175,000, it had not been a breach of duty to have accepted that, in the circumstances as had been known to them at the time. View
Axnoller Events Ltd v Brake and another; Brake and others v Chedington Court Estate Ltd (17 August 2021)
The Chancery Division made rulings on two applications in proceedings concerning a property dispute. The court held that the applicants had not been 'unfairly prejudiced' by a moratorium that one of the parties had entered under the Debt Respite Scheme (Breathing Space Moratorium and Mental Health Crisis Moratorium) (England and Wales) Regulations 2020, SI 2021/1311. The application to cancel the moratorium would be refused. Further, the applicants' case for an 'unless' order in relation to two earlier costs orders had not been made out, but the case for an 'unless' order regarding to later orders had. View
The Chancery Division made rulings on two applications in proceedings concerning a property dispute. The court held that the applicants had not been 'unfairly prejudiced' by a moratorium that one of the parties had entered under the Debt Respite Scheme (Breathing Space Moratorium and Mental Health Crisis Moratorium) (England and Wales) Regulations 2020, SI 2021/1311. The application to cancel the moratorium would be refused. Further, the applicants' case for an 'unless' order in relation to two earlier costs orders had not been made out, but the case for an 'unless' order regarding to later orders had. View
Absolute Living Developments Ltd (in liquidation) (acting by its liquidator, Louise Mary Brittain) v DS7 Ltd and others (29 June 2021)
The applicant applied for an interim injunction seeking to restrain the first respondent insolvent company and its liquidator from selling properties of the company. The Business and Property Court, dismissing the application, held that, at the stage of an interim injunction, the applicant had failed to establish an arguable case that the sale of the properties was as a result of misconduct. View
The applicant applied for an interim injunction seeking to restrain the first respondent insolvent company and its liquidator from selling properties of the company. The Business and Property Court, dismissing the application, held that, at the stage of an interim injunction, the applicant had failed to establish an arguable case that the sale of the properties was as a result of misconduct. View
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