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Re Seabrooke Road Ltd; Security Trustee Services Ltd and others v Seabrooke Road Ltd (Judgment date 25 January 2021)

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 Administration – Appointment of administrator. The receivers of a property, which the respondent company owned, succeeded on their application under the Insolvency Act 1986 for orders that: (i) notices of intention to appoint an administrator (NOITAs), (filed by, or on behalf of, the respondent) be removed from the court file; (ii) the appointment of two individuals (M and N), as joint receivers of the property be declared valid; and (iii) notwithstanding the filing of the first and second NOITAs, the appointment and subsequent actions of M and N, as joint receivers of the property, would be permitted. The Chancery Division, in granting the relief sought, held that the NOITAs constituted an abuse of process, in circumstances where the requisite notice had not been given to the qualifying floating charge holder. The court considered that the requirement of prior notice was an important check or balance in the process under IA 1986 Sch B1 before a company could, itself, in those circumstances, appoint an administrator. Further, it held that, on the present facts, there had never been the necessary intention required before a valid notice could have been given under Sch B1 para 26, that the notices filed in court were not valid notices and that the interim moratorium, which resulted from such notices, if valid, had never come into effect.

 

 

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