The court was asked how the administrators should deal with third parties seeking to exercise existing proprietary rights (including security rights) against the company in administration, and gave guidance. Nicholls LJ noted that in some cases there would be a dispute over the existence, validity or nature of the security which the third party was seeking to enforce. In that context, it was not for the court (on the application for permission to lift the moratorium) to seek to adjudicate upon that issue ‘unless . . the issue raises a short point of law’. Otherwise (i.e. wherever the issue about the validity or nature of the security did not raise a short point of law) the Court would need to be satisfied only that the applicant for permission to enforce the proprietary right had a seriously arguable case.
Judges:
Neill, Staughton, Nicholls LJJ
Citations:
[1990] EWCA Civ 20, [1992] Ch 505, [1990] BCC 859, [1992] 2 WLR 367
Links:
Jurisdiction:
England and Wales
Cited by:
Cited – McCartney and Unite The Union and Another v Nortel Networks UK Ltd (In Administration) ChD 22-Apr-2010
The administrators gave employees of the company notice of termination of their employment. Then administrators refused consent under para 43(6) to actions against the company in the Northern Ireland Industrial Tribunal for protective awards, unfair . .
Lists of cited by and citing cases may be incomplete.
Insolvency, Company
Updated: 19 July 2022; Ref: scu.276299