Gas and Electricity Markets Authority v GB Energy Supply Ltd: ChD 21 Dec 2016

Application brought by the claimant, the Gas and Electricity Markets Authority acting through the officials of OFGEM for a declaration that the defendant company GB Energy Supply Ltd is unable to pay its debts and therefore conditions in the relevant Electricity Supply Licence and Gas Supply Licence, whereby GEMA authorises the defendant to operate as a gas and electricity supplier in the UK, are satisfied. If those conditions are satisfied then under the terms of the relevant licences GEMA can revoke the supply licences and appoint another energy supplier as a Supplier of Last Resort.

Birss J
[2016] EWHC 3341 (Ch)
Bailii
England and Wales

Utilities, Insolvency

Updated: 27 January 2022; Ref: scu.572752

Fehily and Another v Atkinson and Another: ChD 1 Dec 2016

A party sought annullment of bankruptcy orders made after their failure to comply with the terms of IVAs. The second claimant said that she had not had capacity to enter into the IVA.
Held: Her appeal failed. A failure to grasp the deail of an arrangement for lack of cpaacity was not enough to undermine the transaction provieded that she ‘ had the ability to absorb, retain, understand, process and weigh information about the key features and effects of the proposed transaction, and the alternatives to it, if they were explained to the person in broad terms and simple language.’

Stephen Jourdan QC
[2016] EWHC 3069 (Ch), 2016] WLR(D) 643
Bailii, WLRD
England and Wales

Insolvency

Updated: 26 January 2022; Ref: scu.571992

Sands (As Trustee In Bankruptcy) v Layne and Another: CA 29 Nov 2016

The court was asked whether section 375 allowed a court to review, rescind or vary an order which was previously made by that court in exercise of its jurisdiction to hear an appeal from a lower court.

Arden, Lewison, McCombe LJJ
[2016] WLR(D) 632, [2016] EWCA Civ 1159
Bailii, WLRD
Insolvency Act 1986 375(1)
England and Wales

Insolvency, Litigation Practice

Updated: 26 January 2022; Ref: scu.571941

Webb-Samann v Seagan: ECJ 24 Nov 2016

ECJ (Judgment) Reference for a preliminary ruling – Social policy – Directive 2008/94/EC – Article 8 – Protection of employees in the event of the insolvency of their employer – Provisions related to social security – Scope – Measures necessary to protect immediate or prospective entitlements of employees under supplementary pension schemes – Obligation to provide for a right to have outstanding pension contributions excluded from the scope of insolvency proceedings – Absence)

ECLI:EU:C:2016:891, [2016] EUECJ C-454/15
Bailii
European

Insolvency

Updated: 26 January 2022; Ref: scu.571888

Avonwick Holdings Ltd and Another v Shlosberg: CA 18 Nov 2016

Appeal from order directing firm of solicitors to cease acting for a bankrupt’s trustees on the basis that the solicitors had had access to substantial volumes of privileged materials when previously acting for the bankrupt.

Sir Terence Etherton MR, Gloster, Sharp LJJ
[2016] EWCA Civ 1138
Bailii
England and Wales

Insolvency, Legal Professions

Updated: 25 January 2022; Ref: scu.571418

Private Equity Insurance Group: ECJ 10 Nov 2016

ECJ (Judgment) Reference for a preliminary ruling – Directive 2002/47/EC – Scope – Definition of ‘financial collateral’, ‘relevant financial obligations’ and ‘provision’ of financial collateral – Whether it is possible to enforce financial collateral notwithstanding the commencement of insolvency proceeding – Current account agreement including a financial collateral clause

[2016] WLR(D) 587, [2016] EUECJ C-156/15
Bailii, WLRD
Directive 2002/47/EC
European

Insolvency

Updated: 25 January 2022; Ref: scu.571283

ENEFI Energiahatekonysagi Nyrt v Directia Generala Regionala has Finantelor Publice Brasov: ECJ 9 Nov 2016

ECJ (Judgment) Preliminary reference – judicial cooperation in civil matters – Insolvency proceedings – Regulation (EC) No 1346/2000 – Article 4 – Effects provided by the legislation of a Member State on loans not having been insolvency proceedings – Loss – tax Nature of debt – No effect – Article 15 – Meaning of ‘running instances’ – enforcement procedures – Excluded

[2016] EUECJ C-212/15
Bailii
Regulation (EC) No 1346/2000 4
European

Insolvency

Updated: 25 January 2022; Ref: scu.571272

Golstein v Bishop and Another: ChD 7 Nov 2016

[2016] EWHC 2804 (Ch)
Bailii
England and Wales
Citing:
See AlsoGolstein v Bishop ChD 2-May-2013
. .
See AlsoBishop v Golstein CA 5-Feb-2014
. .
See AlsoGolstein v Bishop and Another ChD 2-Sep-2016
Appeal against refusal of challenge to approval on an Individual Voluntary Arrangement. . .

Lists of cited by and citing cases may be incomplete.

Insolvency

Updated: 25 January 2022; Ref: scu.570910

Nortel Group, Re (Global Settlement): ChD 3 Nov 2016

Application by the administrators of 19 Europe, Middle East and Africa (‘EMEA’) companies in the Nortel group (the ‘Administrators’). The Administrators seek directions from the court that they be at liberty to perform and procure that the companies perform a global settlement of the vast majority of disputes that have arisen in relation to the affairs of the Nortel group and the distribution of the proceeds of sale of its assets which amount to about US$7.3 billion

Snowden J
[2016] EWHC 2769 (Ch)
Bailii
England and Wales

Insolvency

Updated: 24 January 2022; Ref: scu.570850

SCI Senior Home, in administration v Gemeinde Wedemark: ECJ 26 Oct 2016

ECJ Judgment – Reference for a preliminary ruling – Area of freedom, security and justice – Judicial cooperation in civil matters – Insolvency proceedings – Regulation (EC) No 1346/2000 – Article 5 – Notion of ‘third parties’ rights in rem’ – Public charge against immovable property to ensure payment of real property tax

ECLI:EU:C:2016:804, [2016] EUECJ C-195/15
Bailii
European

Insolvency

Updated: 24 January 2022; Ref: scu.570591

Clark and Others (Liquidators of West Calder Oil Co) v Wilson and Others: SCS 7 Jun 1878

A company was being voluntarily wound up when one of their creditors poinded the company’s goods for a debt due for expenses in an action of interdict. The liquidators and a majority of three-fourths of the company’s creditors then entered into an arrangement under the above-mentioned sections of the statute, with a view to restraining diligence. The third heading of the arrangement was as follows: ‘The rights of all parties under the voluntary liquidation shall be settled on the same footing as if there had been a winding-up by or subject to the supervision of the Court under and in terms of the Companies Act 1862.’
A petition at the instance of the liquidators, under the 138th section of the Companies Act 1862, praying the Court to restrain the diligence which had been used as above, refused on the ground that the heading of the arrangement quoted above aimed at introducing a new method of winding-up, viz., a voluntary winding-up proceeding on the same footing as a winding-up under the supervision of the Court, and was beyond the powers conferred by the 135th and 136th sections of the Act.
Opinion ( per Lord Shand) that as the petition raised a question directly ‘in the matter of the winding-up, ‘ it could competently under the 138th section of the Companies Act 1862, be brought before the Lord Ordinary on the Bills in vacation.

[1878] SLR 15 – 600
Bailii
Scotland

Insolvency

Updated: 24 January 2022; Ref: scu.577390

In re Asphaltic Wood Pavement Co Ltd; Lee and Chapman’s Case: 1885

Running Contract – Charge on Moneys’ payable under the Contract – Winding-up of contracting Company – Set-off – Salvage Money – Moneys payable under concurrent Contracts – Notice – Mutual Credit

(1885) 30 Ch D 216, [1885] UKLawRpCh 54
Ciommoinlii
Bankruptcy Act 1869
England and Wales
Cited by:
CitedIn re Charge Card Services Ltd ChD 1987
The court discussed the historic availability of set-off in an insolvency: ‘By the turn of the [20th] century, therefore, the authorities showed that debts whose existence and amount were alike contingent at the date of the receiving order, and . .

Lists of cited by and citing cases may be incomplete.

Insolvency

Updated: 24 January 2022; Ref: scu.196875

Muhammed v Robert and Another: ChD 18 Jun 2014

Application for permission to appeal against an order dismissing Ms. Muhammed’s application to suspend a warrant for possession of her flat, where she lives, and stated the application to be wholly without merit. The application also seeks permission to appeal out of time a number of orders previously made.

David Richards J
[2014] EWHC 4800 (Ch)
Bailii
England and Wales

Insolvency

Updated: 23 January 2022; Ref: scu.570009

Hellas Telecommunications (Luxembourg) II Sca, Joint Liquidators of v Slaughter and May (A Firm): ChD 13 Jun 2014

Appeal by the liquidators of a company against the refusal of the Registrar to order that the fees of solicitors employed by the administrators previously in office, which have been agreed and paid by the administrators, should nevertheless be assessed by the court. It raises issues as to the effect of r7.34 of the Insolvency Rules, which provides that such fees may be fixed either by agreement of the responsible insolvency practitioner or by assessment, in circumstances where a liquidator disagrees with the decision of his predecessor.

David Cooke HHJ
[2014] EWHC 1390 (Ch)
Bailii
England and Wales

Insolvency, Costs

Updated: 23 January 2022; Ref: scu.570008

Lomas and Others (Joint Administrators of Lehman Brothers International (Europe)) v Burlington Loan Management Ltd and Others: ChD 5 Oct 2016

The court considered the application of statutory interest pursuant to rule 2.88 of the Insolvency Rules 1986 on debts proved in the administration of Lehman Brothers International (Europe).

Hildyard J
[2016] EWHC 2417 (Ch)
Bailii
Insolvency Act 1986, Insolvency Rules 1986 2.88
England and Wales

Insolvency

Updated: 23 January 2022; Ref: scu.569926

Clark and Others v West Calder Oil Co (Ltd) and Others: SCS 30 Jun 1882

An assignation of a lease intimated to the landlord but not clothed with possession does not create a preferable security in favour of the assignee.
An assignation of moveables retenta possessione imports nothing more than a personal obligation, and does not create a preferable security in favour of the assignee.
A company incorporated under the Companies Acts issued debentures, and in security of the sums advanced on these debentures granted to trustees on behalf of the debenture creditors an assignation to the tenants’ part of certain mineral leases, together with the plant and machinery held by the company; these assignations were intimated to the various landlords, but no possession was taken. The company having fallen into liquidation, the debenture creditors contended that they were entitled to be ranked preferably to the other creditors of the company in respect of the security thus created. Their claim was repelled, no possession having followed on the assignation.
Observations on the difference in the legal position of liquidators and trustees in bankruptcy.

[1882] SLR 19 – 757
Bailii
Scotland

Insolvency

Updated: 23 January 2022; Ref: scu.579253

Re The People’s Restaurant Group Ltd: ChD 30 Nov 2012

Petition praying for (amongst other relief):
1.1 The restoration of The People’s Restaurant Group Limited (‘the Company’) to the Register of Companies.
1.2 Its winding-up to take effect retrospectively from 24 June 2010.
1.3 The suspension of any limitation period between the date of its dissolution and the date of determination of the Petition for any causes of action the Company or its liquidator may have.’

Mr Registrar Jones
[2012] EWHC B33 (Ch)
Bailii
Companies Act 1986, Insolvency Act 1986

Insolvency, Company

Updated: 22 January 2022; Ref: scu.569051

Golstein v Bishop and Another: ChD 2 Sep 2016

Appeal against refusal of challenge to approval on an Individual Voluntary Arrangement.

Warren J
[2016] EWHC 2187 (Ch)
Bailii
England and Wales
Citing:
See AlsoGolstein v Bishop ChD 2-May-2013
. .
See AlsoBishop v Golstein CA 5-Feb-2014
. .

Cited by:
See AlsoGolstein v Bishop and Another ChD 7-Nov-2016
. .

Lists of cited by and citing cases may be incomplete.

Insolvency

Updated: 22 January 2022; Ref: scu.568897

Japan Leasing (Europe) Plc v Shoa Leasing (Singapore) PTE Ltd: ChD 30 Jul 1999

The court considered a hire purchase agreement for an aircraft between four leasing companies and Olympic Airways. The contract documentation provided for the payment of the price in instalments to designated accounts in various currencies of one of the lessors, Japan Leasing. Japan Leasing was to receive the money on behalf of itself and the other three lessors. Japan Leasing went into administration, and a month later received an instalment into the designated accounts. The issue was whether that money was held in trust to pay their shares to the three other lessors.
Held: The court rejected the primary argument of the three solvent lessors that there was an express trust, but held that the last instalment was held on a constructive trust for the other lessors.

Nicholas Warren QC
[1999] BPIR 911, [2000] WTLR 301, [1998] EWHC 322 (Ch)
Bailii
Cited by:
Wrongy decidedBailey and Another v Angove’s Pty Ltd SC 27-Jul-2016
The defendant had agreed to act as the claimant’s agent and distributor of the claimant’s wines in the UK. It acted both as agent and also bought wines on its own account. When the defendant went into litigation the parties disputed the right of the . .

Lists of cited by and citing cases may be incomplete.

Insolvency, Trusts

Updated: 22 January 2022; Ref: scu.568651

The Ruta: QBD 21 Mar 2000

Where a ship-owner became insolvent, and the only remedy for unpaid employees was against the proceeds of sale of the ship, such claims would be granted a priority over lienors of the ship. No formal system can be created compartmentalising such competing claims, but it was characteristic that the employees on the ship once engaged had had to continue. Where several ships were damaged in what was one incident they should be ranked equally.

Times 21-Mar-2000, Gazette 23-Mar-2000
England and Wales

Insolvency, Transport, Employment

Updated: 21 January 2022; Ref: scu.89844

Re BHS Ltd: ChD 29 Jul 2016

The original administrators of the company now in administration, applied for the appointment of two further concurrent administrators, so that once the concurrent administrators are appointed, the original administrators will remain in office so as to continue to trade the business albeit with a view concluding trading activities and assets realisations in order to obtain the best return for creditors while the concurrent administrators commence concurrent investigatory work into the Company’s affairs.

Birss J
[2016] EWHC 1965 (Ch)
Bailii
England and Wales

Insolvency

Updated: 20 January 2022; Ref: scu.567843

Piacentini v Dayman: QBD 5 Feb 2003

The reality of the agency of a receiver for a mortgagor is shown in the absence of personal liability of the receivers for tax in respect of receipts which come to the hands of the receivers as agents.

The Hon Mr Justice Lightman
[2003] EWHC 113 (Admin), [2003] 3 WLR 354
Bailii
England and Wales
Cited by:
CitedSilven Properties Limited, Chart Enterprises Incorporated v Royal Bank of Scotland Plc, Vooght, Harris CA 21-Oct-2003
The claimants sought damages from mortgagees who had sold their charged properties as receivers. They said they had failed to sell at a proper value. They asked whether the express appointment in the mortgage of receivers as agents of the mortgagor . .

Lists of cited by and citing cases may be incomplete.

Insolvency

Updated: 20 January 2022; Ref: scu.179017

Re Charnley Davies Ltd (No 2): ChD 1990

An administrator owed a duty to the company over which he was appointed to take reasonable care to obtain the best price that the circumstances, as he reasonably perceived them to be, permitted, including a duty to take reasonable care in choosing the time at which to sell the property. A mortgagee is bound to have regard to the interests of the mortgagor, but he is entitled to give priority to his own interests, and may insist on an immediate sale whether or not that is calculated to realise the best price. An administrator, by contrast, like a liquidator, has no interest of his own to which he may give priority, and must take reasonable care in choosing the time at which to sell the property.
Millett J said: ‘An allegation that the acts complained of are unlawful or infringe the petitioner’s legal rights is not a necessary averment in a s.27 petition. In my judgment it is not a sufficient averment either. The petitioner must allege and prove that they are evidence or instances of the management of the company’s affairs by the administrator in a manner which is unfairly prejudicial to the petitioner’s interests. Unlawful conduct may be relied on for this purpose, and its unlawfulness may have a significant probative value, but it is not the essential factor on which the petitioner’s cause of action depends.
Counsel for the petitioners asked: ‘If misconduct in the management of the company’s affairs does not without more constitute unfairly prejudicial management, what extra ingredient is required?’ In my judgment the distinction between misconduct and unfairly prejudicial management does not lie in the particular acts or omissions of which complaint is made, but in the nature of the complaint and the remedy necessary to meet it. It is a matter of perspective. The metaphor is not a supermarket trolley but a hologram. If the whole gist of the complaint lies in the unlawfulness of the acts or omissions complained of, so that it may be adequately redressed by the remedy provided by law for the wrong, the complaint is one of misconduct simpliciter. There is no need to assume the burden of alleging and proving that the acts or omissions complained of evidence or constitute unfairly prejudicial management of the company’s affairs. It is otherwise if the unlawfulness of the acts or omissions complained of is not the whole gist of the complaint, so that it would not be adequately redressed by the remedy provided by law for the wrong. In such a case it is necessary to assume that burden, but it is no longer necessary to establish that the acts or omissions in question were unlawful, and a much wider remedy may be sought.
A good illustration of the distinction is provided by Re a company (No 005287 of 1985) [1986] BCLC 68. In that case the petitioners, who were minority shareholders, alleged that the respondent, who was the majority shareholder, had disposed of the company’s assets in breach of his fiduciary duty to the company and in a manner which was unfairly prejudicial to the interests of the petitioner. Hoffmann J refused to strike out the petition, holding that the fact that the petitioners could have brought a derivative action did not prevent them seeking relief under s 459.
Again, I respectfully agree. The very same facts may well found either a derivative action or a s 459 petition. But that should not disguise the fact that the nature of the complaint and the appropriate relief is different in the two cases. Had the petitioners’ true complaint been of the unlawfulness of the respondent’s conduct, so that it would be met by an order for restitution, then a derivative action would have been appropriate and a s 459 petition would not. But that was not the true nature of the petitioners’ complaint. They did not rely on the unlawfulness of the respondent’s conduct to found their cause of action; and they would not have been content with an order that the respondent make restitution to the company. They relied on the respondent’s unlawful conduct as evidence of the manner in which he had conducted the company’s affairs for his own benefit and in disregard of their interests as minority shareholders; and they wanted to be bought out. They wanted relief from mismanagement, not a remedy for misconduct.
When the petitioners launched the present proceedings, they wrongly believed that Mr Richmond was managing the affairs of the company in a manner which disregarded their interests and those of the creditors generally. That was a perfectly proper complaint to bring under s 27. Long before the case came to trial, however, it had become a simple action for professional negligence and nothing more. That, if established, would amount to misconduct; but it would neither constitute nor evidence unfairly prejudicial management. In my judgment it would be a misuse of language to describe an administrator who has managed the company’s affairs fairly and impartially and with a proper regard for the interests of all the creditors (and members where necessary), conscientiously endeavouring to do his best for them, but who has through oversight or inadvertence fallen below the standards of a reasonably competent insolvency practitioner in the carrying out of some particular transaction, as having managed the affairs of the company in a manner which is unfairly prejudicial to the creditors.’

Millett J
[1990] BCLC 760
Companies Act 1985 459
England and Wales
Citing:
CitedStandard Chartered Bank Ltd v Walker CA 1982
The mortgagee having obtained insufficient on the sale at auction of the property charged to recover the sum secured, applied for summary judgment against the mortgagor for that sum. The mortgagor resisted the application alleging that the mortgagee . .
CitedCuckmere Brick Co Ltd v Mutual Finance Ltd CA 1971
A mortgagee selling as mortagee in possession must ‘take reasonable care to obtain the true value of the property at the moment he chooses to sell it’ and obtain the best price for the property reasonably obtainable on the open market. However, . .

Cited by:
CitedSilven Properties Limited, Chart Enterprises Incorporated v Royal Bank of Scotland Plc, Vooght, Harris CA 21-Oct-2003
The claimants sought damages from mortgagees who had sold their charged properties as receivers. They said they had failed to sell at a proper value. They asked whether the express appointment in the mortgage of receivers as agents of the mortgagor . .
CitedSilven Properties Ltd and Another v Royal Bank of Scotland Plc and Others CA 21-Oct-2003
The claimants complained that the receivers appointed by the bank had failed to get the best price for properties charged to the bank and sold, in that they had failed to obtain planning permissions which would have increased the values of the . .

Lists of cited by and citing cases may be incomplete.

Negligence, Company, Insolvency

Updated: 20 January 2022; Ref: scu.187031

In re Polly Peck International plc, Ex parte the joint administrators: ChD 1994

The purposes of a liquidation, or administration or receivership of a company must include the gathering of information as to the conduct of the affairs of the company, and those who had conducted them so that the office-holder can report to the Secretary of State as he is required to do by section 7(3) of the Disqualification Act: ‘it is quite clear that the purposes of the administration must include the gathering of information as to the conduct of the affairs of the company and those responsible for it by an administrator in order that he can report to the Secretary of State as he is required to do. He must do so in order that the Secretary of State can perform his duty, which is the important one of taking proceedings if it appears that a disqualification order should be made.’

Vinelott J
[1994] BCC 15
Company Directors’ Disqualification Act 1986 7(3), Insolvency Act 1986
England and Wales
Cited by:
CitedOfficial Receiver v Wadge Rapps and Hunt (a firm) and another and two other actions HL 31-Jul-2003
(Orse In re Pantmaenog Timber Co Ltd)
The Receiver sought to use information obtained under section 236 (documents recovered from the directors’ solicitors) in disqualification proceedings.
Held: The appeal succeeded. The Act had . .

Lists of cited by and citing cases may be incomplete.

Insolvency, Company

Updated: 20 January 2022; Ref: scu.186355

Roberts v Pinnacle Entertainment Limited: ChD 21 Oct 2003

This was an appeal against a revocation of an approval of an individual voluntray arrangement. The notice to creditors inviting them to attend the meeting had been in an outdated form.
Held: The creditir had given suficient evidence of his debt to be allowed to vote at the meeting. The disallowance of the vote was a material irregularity, and the appeal failed.

The Hon Mr Justice Evans-Lombe
[2003] EWHC 2394 (Ch)
Bailii
Insolvency Act 1986 262
England and Wales
Citing:
Citedre K G Hoare ChD 1997
A creditor who wishes to vote in respect of his debt must state to the best of his ability the total amount that is owing to him by the debtor. . .

Lists of cited by and citing cases may be incomplete.

Insolvency

Updated: 20 January 2022; Ref: scu.187018

BTI 2014 Llc v Sequana Sa and Others: ChD 11 Jul 2016

Allegation that the payment of dividends was in breach of Part 23 of the 2006 Act. The direcors had signed the necessary certicate as to solvency before resolving to reduce the company capital and paying a dividend.
Held: When makingsuch a statement, the directors were not being asked what would be the position if a calamity occurred. The test was whether at the time and circumstances of the statement, and taking account of the anticipated contingencies, the compny was solvent.
However the payment of a dividend could be a transaction at ann undervalure within section 423(1) of the 1986 Act.

Rose J
[2016] EWHC 1686 (Ch), [2016] WLR(D) 388, [2017] Bus LR 82
Bailii, WLRD
Companies Act 2006, Insolvency Act 1986 423(1)
England and Wales

Company, Insolvency

Updated: 19 January 2022; Ref: scu.566875

HM Revenue and Customs v Ariel: ChD 8 Jul 2016

The trustee in bankruptcy appealed against an order as to compliance with statutory notices issued by HMRC. The trustee argued that all but one of the orders was made in excess of jurisdiction.

Mann J
[2016] EWHC 1674 (Ch)
Bailii
Insolvency Act 1986 303, Finance Act 2008 Sch 36
England and Wales

Insolvency, Taxes Management

Updated: 19 January 2022; Ref: scu.566825

Re Paramount Airways Ltd (In Administration): CA 8 Apr 1992

It was said that there had been a transction at an undervalue within section 238. It was given effect by a transfer to a bank in Jersey, from which recovery was no sought. The bank claimed that the section did not have extra-territorial effect.
Held: The argument failed; the section did not purport to have any territorial limitation. There is no strict limitation on recovery proceedings against foreign residents. The provisions of the Insolvency Act 1986 for setting aside transactions at an undervalue had, as a matter of construction, world-wide application but the court had a discretion to refuse to make an order in a case not sufficiently connected with England: ‘In my view the solution to the question of statutory interpretation raised by this appeal does not lie in retreating to a rigid and indefensible line. Trade takes place increasingly on an international basis. So does fraud. Money is transferred quickly and easily. To meet these changing conditions English courts are more prepared than formerly to grant injunctions in suitable cases against non-residents or foreign nationals in respect of overseas activities. As I see it, the considerations set out above and taken as a whole lead irresistibly to the conclusion that, when considering the expression ‘any person’ in the sections, it is impossible to identify any particular limitation which can be said, with any degree of confidence, to represent the presumed intention of Parliament. What can be seen is that Parliament cannot have intended an implied limitation along the lines of Ex parte Blain, 12 Ch.D. 522. The expression therefore must be left to bear its literal, and natural, meaning: any person.’

Sir Donald Nicholls V-C
Gazette 08-Apr-1992, [1993] Ch 223
Insolvency Act 1986 238(2)
England and Wales
Cited by:
CitedSerco Ltd v Lawson; Botham v Ministry of Defence; Crofts and others v Veta Limited HL 26-Jan-2006
Mr Lawson was employed by Serco as a security supervisor at the British RAF base on Ascension Island, which is a dependency of the British Overseas Territory of St Helena. Mr Botham was employed as a youth worker at various Ministry of Defence . .
See AlsoIn Re Paramount Airways Ltd (In Administration) ChD 14-Sep-1993
Administrators may adopt employment contracts without attracting personal liability. . .
CitedHaines v Hill and Another CA 5-Dec-2007
On the divorce, the husband was ordered to transfer his share in the house to the wife. On his bankruptcy shortly after, the order was confirmed. After the wife sold the property at a profit, the trustee in bankruptcy applied to set the transfer . .
CitedMcGrath and others v Riddell and others HL 9-Apr-2008
(Orse In Re HIH Casualty and General Insurance Ltd)
HIH, an Australian Insurance company, became insolvent. An order was sought for the collection and remission of it assets in England under a letter of request from the Australia Court.
CitedBilta (UK) Ltd and Others v Nazir and Others ChD 30-Jul-2012
The company was said to have engaged in a fraud based on false European Trading Scheme Allowances, and had been wound up by the Revenue. The liquidators, in the company name, now sought recovery from former directors and associates.
Held: The . .

Lists of cited by and citing cases may be incomplete.

Insolvency, International

Updated: 19 January 2022; Ref: scu.85851

Visciano v Istituto nazionale della previdenza soziale: ECJ 16 Jul 2009

ECJ Social policy Protection of workers Insolvency of employer Directive 80/987/EEC Obligation to pay all outstanding claims up to a pre-established ceiling Nature of an employee’s claims against a guarantee institution Limitation period

C.W.A. Timmermans, P
[2009] EUECJ C-69/08 – O, ECLI:EU:C:2009:468, C-69/08
Bailii
Directive 80/987/EEC
Citing:
OpinionVisciano v Istituto nazionale della previdenza soziale ECJ 2-Apr-2009
ECJ Social policy Approximation of laws Protection of employees in the event of employer insolvency – Directive 80/987 / EEC Obligation to pay claims arising from an employment relationship within the limit of a . .

Lists of cited by and citing cases may be incomplete.

European, Insolvency, Employment

Updated: 18 January 2022; Ref: scu.566480

Quartz Hill Consolidated Gold Mining Co v Eyre: CA 26 Jun 1883

The court considered whether an action lay without proof of special damage for maliciously presenting a winding up petition.
Held: There was. Though there was no general cause of action for maliciously bringing civil proceedings without reasonable and probable cause, an action for malicious prosecution could, however, be brought in specific cases. The absence of any reasonable cause or foundation of suspicion may be evidence of malice on the part of a prosecutor.
Brett MR said: ‘It seems to me that an action can be maintained for maliciously procuring an adjudication under the Bankruptcy Act 1869, because by the petition, which is the first process, the credit of the person against whom it is presented is injured before he can shew that the accusation made against him is false; he is injured in his fair fame, even although he does not suffer a pecuniary loss . . he is openly charged with insolvency before he can defend himself. It is not like an action charging a merchant with fraud, where the evil done by bringing the action is remedied at the same time that the mischief is published, namely, at the trial.
The present case, therefore, is reduced to this question, namely, is a petition to wind up a company more like an action charging fraud or more like a bankruptcy petition? In my opinion it is more like a bankruptcy petition, and the very touchstone of this point is that the petition to wind-up is by force of law made public before the company can defend itself against the imputations made against it; for the petitioner is bound to publicly advertise the petition seven days before it is to be heard and adjudicated upon.’
Bowen LJ said that: ‘the very institution of [insolvency] proceedings’ ‘strike home at a man’s credit’. An action for malicious prosecution was available, but ‘No mere bringing of an action, although it is brought maliciously and without reasonable or probable cause, will give rise to an action for malicious prosecution. In no action, at all events in none of the ordinary kind, not even in those based on fraud where there are scandalous allegations in the pleadings, is damage to a man’s fair fame the necessary and natural consequence of bringing the action.’ As to the costs incurred in defending a civil action, he said: ‘The bringing of an ordinary action does not as a natural or necessary consequence involve any injury to a man’s property, for this reason, that the only costs which the law recognises, and for which it will compensate him, are the costs properly incurred in the action itself. For those the successful defendant will have been already compensated, so far as the law chooses to compensate him. If the judge refuses to give him costs, it is because he does not deserve them: if he deserves them, he will get them in the original action: if he does not deserve them, he ought not to get them in a subsequent action. Therefore the broad cannon is true that in the present day, and according to the present law, the bringing of an ordinary action, however maliciously, and however great the want of reasonable and probable cause, will not support a subsequent action for malicious prosecution.’

Bowen LJ, Brett MR
(1883) 11 QBD 674, (1882-1883) 11 QBD 674, [1883] UKLawRpKQB 126
Commonlii
England and Wales
Citing:
CitedSavill v Roberts CCP 1790
. .

Cited by:
CitedGibbs and others v Rea PC 29-Jan-1998
(Cayman Islands) The respondent worked for a bank. He disclosed a business interest, but that interest grew in importance to the point where he resigned in circumstances amounting to constructive dismissal. His home and business officers were raided . .
CitedWatkins v Secretary of State for The Home Departmentand others CA 20-Jul-2004
The claimant complained that prison officers had abused the system of reading his solicitor’s correspondence whilst he was in prison. The defendant argued that there was no proof of damage.
Held: Proof of damage was not necessary in the tort . .
CitedMohammed Amin v Jogendra Kumar Bannerjee PC 1947
The Board considered an action for malicious prosecution. Sir John Beaumont said: ‘The foundation of the action lies in abuse of the process of the court by wrongfully setting the law in motion, and it is designed to discourage the perversion of the . .
CitedGregory v Portsmouth City Council CA 5-Nov-1997
The plaintiff councillor had been disciplined by the defendant for allegations. The findings were later overturned, and he now sought damages alleging malicious prosecution.
Held: The categories of malicious prosecution are closed, and it was . .
CitedLand Securities Plc and Others v Fladgate Fielder (A Firm) CA 18-Dec-2009
The claimants wanted planning permission to redevelop land. The defendant firm of solicitors, their tenants, had challenged the planning permission. The claimants alleged that that opposition was a tortious abuse because its true purpose was to . .
CitedGregory v Portsmouth City Council HL 10-Feb-2000
Disciplinary proceedings had been taken by the local authority against Mr Gregory, a council member, after allegations had been made that he had failed to declare conflicts of interest, and that he had used confidential information to secure a . .
CitedCrawford Adjusters and Others v Sagicor General Insurance (Cayman) Ltd and Another PC 13-Jun-2013
(Cayman Islands) A hurricane had damaged property insured by the respondent company. The company employed the appellant as loss adjustor, but came to suspect advance payments recommended by him, and eventually claimed damages for deceit and . .
CitedWilliamson v The Attorney General of Trinidad and Tobago PC 3-Sep-2014
(Trinidad and Tobago) The claimant had been held after arrest on suspicion of theft. He was held for several months before the case was dismissed, the posecution having made no apparent attempt to further the prosecution. He appealed against refusal . .
CitedWillers v Joyce and Another (Re: Gubay (Deceased) No 1) SC 20-Jul-2016
Parties had been involved in an action for wrongful trading. This was not persisted with but the claimant sought damages saying that the action was only part of a campaign to do him harm. This appeal raised the question whether the tort of malicious . .

Lists of cited by and citing cases may be incomplete.

Torts – Other, Insolvency

Updated: 18 January 2022; Ref: scu.184705

Brown and Another v Stonegale Ltd and Another: SC 22 Jun 2016

The insolvent companies administrators sought reduction of alienations by the companies before entering into administration. It was said that their banker lenders had been misled as to the values of secured properties, agreeing to their release leading to losses, and their sale.
Held: The appeals failed: ‘The gratuitous nature of the alienations was clearly explained by the Lord Ordinary . . Before the various conveyances, the companies owned five properties. A bargain was in place for the sale of one of those properties, 278 Glasgow Road, for the sum of andpound;2.4m. After the sale was completed, andpound;2.4m was transferred to the bank in reduction of borrowings, and the companies retained the other four properties, valued at andpound;1.525m. Those properties were then conveyed to the appellants. The companies received nothing whatsoever in return. There was no reciprocity between those disposals and the earlier payment made to the bank. The purpose and effect of those transactions was to divert assets away from the companies’ creditors: exactly what section 242 is intended to prevent. That they were gratuitous alienations is plain and obvious.’

Lord Neuberger, President, Lord Sumption, Lord Reed, Lord Carnwath, Lord Hodge
[2016] UKSC 30
Bailii, Bailii Summary
Insolvency Act 1986 242
Scotland
Citing:
Appeal fromBrown and Another (Joint Administrators of Oceancrown Ltd) v Stonegale Ltd SCS 11-Dec-2013
Administrators sought to have set aside transactions made before the companies went into administration.
Held: Rejecting the director’s arguments, the Lord Ordinary said: ‘No one paid anything for 110, 210, 260 Glasgow Road and 64 Roslea . .

Lists of cited by and citing cases may be incomplete.

Insolvency

Updated: 18 January 2022; Ref: scu.565828

Barons Bridging Finance 1 Ltd and Others v Barons Finance Ltd: CA 14 Jun 2016

Appeal against finding that an assignment of book debts was void, as it had been made after the commencement of the Company’s winding up or, even if that were not the case, should be set aside (a) under section 238 of the Act as a transaction at an undervalue and (b) under section 423 of the Act as a transaction to defraud creditors.

Kitchin, Gloster LJJ
[2016] EWCA Civ 550
Bailii
Insolvency Act 1986 127 238 423
England and Wales

Insolvency

Updated: 17 January 2022; Ref: scu.565675

Revenue and Customs v Lomas and Others (Administrators of Lehman Brothers International (Europe)): CA 19 Dec 2017

Lady Justice Gloster Vice-President of the Court of Appeal, Civil Division, Lord Justice Patten, and Lord Justice David Richards
[2017] EWCA Civ 2124, [2018] Bus LR 730, [2018] STI 259, [2018] STC 385, [2018] BTC 5
Bailii
England and Wales
Citing:
Appeal fromLomas and Others v HM Revenue and Customs ChD 11-Oct-2016
Receivers’ payment of statutory interest gross
Substantial sums were to be repaid to creditors after the administration of Lehman Brothers produced a substantial surplus. The sums were to carry interest and the court now considered whether the sums due amounted to ‘yearly interest’ under section . .

Cited by:
Appeal fromRevenue and Customs v Joint Administrators of Lehman Brothers International (Europe) SC 13-Mar-2019
The Court was asked whether interest payable under rule 14.23(7) of the Insolvency Rules 2016 is ‘yearly interest’ within the meaning of section 874 of the Income Tax Act 2007. If so, the administrators must deduct income tax before paying interest . .

Lists of cited by and citing cases may be incomplete.

Insolvency

Updated: 17 January 2022; Ref: scu.601510

Corporate Commercial Bank v Elit Petrol AD: ECJ 15 Jan 2020

(Area of Freedom, Security and Justice – Order) Reference for a preliminary ruling – Article 53 (2) of the Rules of Procedure of the Court – Judicial cooperation in civil matters – Insolvency proceedings – Retroactive modification of the conditions for the execution of reciprocal set-offs carried out with a bankrupt credit institution – State of law – Principle of legal certainty – Right to an effective remedy

C-647/18, [2020] EUECJ C-647/18_CO, ECLI: EU: C: 2020: 13
Bailii
European

Insolvency

Updated: 17 January 2022; Ref: scu.654686

Revenue and Customs v Joint Administrators of Lehman Brothers International (Europe): SC 13 Mar 2019

The Court was asked whether interest payable under rule 14.23(7) of the Insolvency Rules 2016 is ‘yearly interest’ within the meaning of section 874 of the Income Tax Act 2007. If so, the administrators must deduct income tax before paying interest to creditors. Lehmann Brothers had become insolvent, but in the administration a substantial surplus was achieved. About 5 billion pounds was payable as statutory interest.
Held: The administrators’ appeal failed. Tax was deductible before payment out. Interest is paid as statutory compensation for the loss which the creditors have suffered by being kept out of their money during the administration. Income tax legislation adopted a dichotomy between the treatment of interest of any kind which is not paid out of profits or gains, on the one hand, and yearly interest, on the other hand.

Lord Reed (Deputy President), Lord Carnwath, Lord Hodge, Lady Black, Lord Briggs
[2019] UKSC 12, UKSC 2018/0013, [2019] Bus LR 927, [2019] 1 BCLC 609, [2019] STC 661, [2019] BTC 9, [2019] BCC 720, [2019] 2 All ER 559, [2019] STI 705, [2019] 1 WLR 2173
Bailii, Bailii Summary, SC, SC Summary, SC Summary Video, SC 2019 Feb 12 am Video, SC 2019 Feb 12 pm Video
Income Tax Act 2007 874, Insolvency Rules 2016 14.23(7)
England and Wales
Citing:
CitedBebb v Bunny 22-Dec-1854
A purchaser liable to pay interest on his purchase-money may deduct income tax from such interest. It was the practice to deduct the tax from the interest on debts upon promissory notes and the like in the offices of the Masters in Chancery. The tax . .
Appeal fromRevenue and Customs v Lomas and Others (Administrators of Lehman Brothers International (Europe)) CA 19-Dec-2017
. .
CitedLB Holdings Intermediate 2 Ltd, The Joint Administrators of v Lehman Brothers International (Europe), The Joint Administrators of and Others SC 17-May-2017
In the course of the insolvent administration of the bank, substantial additional sums were received. Parties appealed against some orders made on the application to court for directions as to what was to be done with the surplus.
Held: The . .
CitedVyse v Foster HL 1874
Where a person already has contractual relations with another, his assumption of a fiduciary role in relation to that other will not necessarily require him to abandon his own contractual interests. . .
CitedLomas and Others v HM Revenue and Customs ChD 11-Oct-2016
Receivers’ payment of statutory interest gross
Substantial sums were to be repaid to creditors after the administration of Lehman Brothers produced a substantial surplus. The sums were to carry interest and the court now considered whether the sums due amounted to ‘yearly interest’ under section . .
CitedSadler v the South Staffordshire and Birmingham District Steam Tramways Co CA 26-Jun-1889
Interest upon a loan by a banker to a customer for a period of less than a year is not within the words ‘ any yearly interest of money or any annuity or other annual payment ‘ in 16 and 17 Viet. c. 34, s. 40, and therefore the customer is not . .
CitedTarget Holdings Ltd v Redferns (A Firm) and Another HL 21-Jul-1995
The defendant solicitors had acted for a purchaser, Crowngate, which had agreed to buy a property from a company called Mirage for andpound;775,000. Crowngate had arranged however that the property would first be passed through a chain of two . .
CitedJefford v Gee CA 4-Mar-1970
The courts of Scotland followed the civil law in the award of interest on damages. The court gave examples of the way in which they apply the ex mora rule when calculating the interest payable in a judgment. If money was wrongfully withheld, then . .
CitedCorinthian Securities Ltd v Cato CA 1970
Lord Denning MR said: ‘The words ‘short loan’ are not used in the statute: it is a mistake to place too much emphasis on them. The real question is whether the interest payable is ‘yearly interest of money’. Interest is ‘yearly interest of money’ . .
CitedIn Re T Cooper CA 2-Jun-1911
. .
CitedInland Revenue Commissioners v Barnato CA 1936
The case concerned the liability of Captain Barnato for super-tax on the sums which he received under a judgment for an account against his former partners in the dissolved firm of Barnato Brothers. The sums found due on the taking of the account . .
CitedMayor and Others of Gateshead v Lumsden CA 10-Mar-1914
The plaintiffs, as the urban authority of a borough, had under s. 150 of the Public Health Act, 1875, and the Gateshead Improvement Act 1867, some years before action brought paved and made up certain streets, and had from time to time apportioned . .
CitedRiches v Westminster Bank Ltd HL 1947
The amount of interest payable on compulsory purchase of land depends upon the value given to the land and the length of the period from the time of entry until reinstatement, the period during which the claimant is dispossessed. During that time, . .
CitedMoss Empires Ltd v Inland Revenue Comrs HL 1937
Lord Maugham said that for a payment to be an ‘annual payment’ within the meaning of rule 21 it ‘must be taken to have, like interest on money or an annuity, the quality of being recurrent or being capable of recurrence’. . .
CitedGarston Overseers v Carlisle 1915
The question was as to the scope of the words ‘yearly interest’ used in the Income Tax Acts of 1842 and 1853. The bankers of certain overseers for the poor allowed the latter by arrangement half-yearly interest at an agreed-on rate on the daily . .
CitedBarlow v Inland Revenue Commissioners 1937
. .

Lists of cited by and citing cases may be incomplete.

Insolvency, Income Tax

Updated: 17 January 2022; Ref: scu.634513

LB Holdings Intermediate 2 Ltd, The Joint Administrators of v Lehman Brothers International (Europe), The Joint Administrators of and Others: SC 17 May 2017

In the course of the insolvent administration of the bank, substantial additional sums were received. Parties appealed against some orders made on the application to court for directions as to what was to be done with the surplus.
Held: The Court considered the so called waterfall of distributions made on liquidation which proved to be in surplus as set out in Nortel.
It was not be open to LBHI2 to lodge a proof in respect of the subordinated debt until the non-provable liabilities have been paid in full, it was clear that, after meeting that proof in full and paying any statutory interest due on it, the non-provable liabilities could be met in full. As soon as that has happened, there would, subject to what I say in the next paragraph, be nothing to stop LBHI2 lodging a late proof: ‘On the face of it at any rate, it seems a little strange that a proof can be, or has to be, lodged for a debt which ranks after statutory interest (which can only be paid out of a ‘surplus’) and non-provable liabilities. It may be that the proper analysis is that the subordinated debt is a non-provable debt which ranks after all other non-provable liabilities.’
Based the narrower or primary contention raised by the LBHI2 administrators, it is not open to the foreign currency creditors to seek to claim as a non-provable debt, the difference between the sterling value of the debt at the administration date and the sterling value of that debt when paid, where the latter exceeds the former.
The contractual right (in this case to recover interest and in the case of currency conversion claims, to be paid at a particular rate of exchange) has been replaced by legislative rules. On that basis, there is no room for the contractual right to revive just because those rules contain a casus omissus or because they result in a worse outcome for a creditor than he would have enjoyed under the contract.
Section 74 can be relied on to meet non-provable liabilities but not statutory interest: ‘I would allow the LBHI2 administrators’ appeal on the issue whether section 74 can be invoked in order to pay statutory interest, but I would dismiss their appeal on the issue whether that section can be invoked in order to meet other non-provable liabilities. I would therefore allow the appeal in part against para (vi) of David Richards J’s order.’

Lord Neuberger, President, Lord Kerr, Lord Clarke, Lord Sumption, Lord Reed
[2017] UKSC 38, [2017] 2 BCLC 149, [2017] 2 WLR 1497, [2017] BCC 235, [2018] AC 465, UKSC 2015/0138
Bailii, Bailii Summary, SC, SC Summary, SC Summary Video
Insolvency Act 1986, Insolvency Rules 1986
England and Wales
Citing:
At ChDRe Lehman Brothers International (Europe) and Others ChD 14-Mar-2014
On the winding up of the company, there had unexpectedly been a surplus of assets after payment of all debts. The court was now asked to determine claims to be allowed before a distribution was made.
Held: The court made declarations as . .
At CALB Holdings Intermediate 2 Ltd, (The Joint Administrators of) and Others v Lomas and Others CA 14-May-2015
Applications after recovery of surplus funds to repay creditors of Lehmann Brothers Ltd. The court had given orders as to the several uses of the surpluses. The parties appealed some elements of those orders.
Held: Most elements were upheld, . .
CitedCherry v Boultbee HL 22-Nov-1839
B died having made a will leaving a fund to pay income to A who owed her money but had been made bankrupt before the death. The debt to B remained unpaid.
Held: The liability to pay the debt and the right to receive the legacy had never tested . .
CitedIn re Nortel Companies and Others SC 24-Jul-2013
The court was asked as to the interrelationship of the statutory schemes relating to the protection of employees’ pensions and to corporate insolvency.
Held: Liabilities which arose from financial support directions or contribution notices . .
CitedIn re Kaupthing Singer and Friedlander Ltd SC 19-Oct-2011
The bank had been put into administrative receivership, and the court was now asked as to how distributions were to be made, and in particular as to the application of the equitable rule in Cherry v Boultbee in the rule against double proof as it . .
CitedBloom and Others v The Pensions Regulator (Nortel, Re) ChD 10-Dec-2010
Applications for directions by the administrators of twenty companies in two groups, all raising the same common questions as to the effect of the Financial Support Direction regime created by the Pensions Act 2004 upon companies in administration . .
CitedBelmont Park Investments Pty Ltd v BNY Corporate Trustee Services Ltd and Another SC 27-Jul-2011
Complex financial instruments insured the indebtedness of Lehman Brothers. On that company’s insolvency a claim was made. It was said that provisions in the documents offended the rule against the anti-deprivation rule. The courts below had upheld . .
CitedGooch v London Banking Association ChD 1886
On the application of a landlord, the court had jurisdiction to restrain the liquidators of a solvent company in voluntary liquidation from distributing assets of the company amongst its shareholders, without setting aside sufficient assets to . .
CitedIn re Fine Industrial Commodities Ltd ChD 1956
The Court considered the payment of interest to simple contract creditors. The company had been wound up on the ground of insolvency. In the course of the winding up the liquidators brought an action to set aside a debenture. The action was . .
CitedMitchell v Carter, In re Buckingham International Ltd CA 1977
The making of a winding-up order ‘divests the company of the beneficial ownership of its assets’, and those assets become ‘subject to a statutory scheme for distribution among the creditors and members’, who have the right to have them administered . .
CitedIn re T and N Ltd and Others, Re Insolvency Act 1986 ChD 14-Dec-2005
The court considered the case of Glenister and similar and said: ‘I accept the submission that these cases are not in point to the issue as regards future asbestos claims. There is no element of discretion as regards such claims. If the ingredients . .
CitedHIH Casualty and General Insurance Limited and others v Chase Manhattan Bank and others HL 20-Feb-2003
The insurance company had paid claims on policies used to underwrite the production of TV films. The re-insurers resisted the claims against them by the insurers on the grounds of non-disclosure by the insured, or in the alternative damages for . .
CitedIn re Islington Metal and Plating Works Ltd ChD 1983
Section 30 of the 1914 Act provided that ‘demands in the nature of unliquidated damages … shall not be provable in bankruptcy’. Tort claims were therefore excluded as provable debts by the express wording of the Act. . .
CitedIn Re Buckingham International Plc ChD 20-Nov-1997
There is no power in the court to make any arrangement which will result in the preference of one set of creditors over others of the same class. . .
CitedIn re Lines Bros Ltd CA 1982
The liquidators in a creditors voluntary liquidation converted foreign currency debts of the company into Sterling at the rate of exchange prevailing at the date of the resolution to wind up. As a result of the depreciation of Sterling against the . .
CitedIn re Humber Ironworks and Shipbuilding Co 1869
The assets of a company held on the statutory trusts should be distributed as if they had all been collected and distributed on the date of the winding up order: ‘I think the tree must lie as it falls; that it must be ascertained what are the debts . .
CitedEx parte Mackay; Ex parte Brown; In re Jeavons 1873
Mr Jeavons sold a patent regarding the manufacture of armour plates to a Brown and Co and Cammell and Co in consideration of the companies paying royalties. There was also a loan from the company to Mr Jeavons secured on the royalties. The parties . .
CitedIn re Pyle Works CA 1890
The court was asked about a mortgage of the uncalled amounts on some partly paid shares and all the present and future property of the company. The issue was whether the mortgages extended to the calls to be made by the liquidator in the winding up . .
CitedParmalat Capital Finance Ltd and others v Food Holdings Ltd and Another PC 9-Apr-2008
(the Cayman Islands) Lord Hoffmann said that ‘a winding up order does not affect the legal rights of the creditors or the company’. . .
CitedFinancial Services Compensation Scheme Ltd v Larnell (Insurances) Ltd CA 29-Nov-2005
The claimant investors said that their financial adviser, the defendant insolvent company, had given them negligent advice. The action was brought as a preliminary to claiming against the defendant’s insurers under the 1930 Act, in the way made . .
CitedBarclays Bank Ltd v Quistclose Investments Ltd; etc HL 31-Oct-1968
R Ltd were in serious financial difficulties. The company’s overdraft with the appellant bank was almost twice its permitted limit. The company sought a loan of 1 million pounds from a financier, who was willing to lend the company that sum provided . .
CitedWight, Pilling, Mackey v Eckhardt Marine GmbH PC 14-May-2003
(Cayman Islands) An international bank went into liquidation in the Cayman Islands, with liabilities in Bangladesh. A new bank was created in Bangladesh, and the applicants sought to make the new bank liable, and through them the liquidators.
CitedInco Europe Ltd and Others v First Choice Distributors (A Firm) and Others HL 10-Mar-2000
Although the plain words of the Act would not allow an appeal to the Court of Appeal under the circumstances presently applying, it was clear that the parliamentary draftsman had failed to achieve what he had wanted to, that the omission was in . .
CitedMiliangos v George Frank (Textiles) Ltd HL 1975
The issue was whether an English court was able to award damages in Sterling only.
Held: The House distinguished clearly between the substance of the debtor’s obligations and the effect of English procedural law when a debt in a foreign . .
CitedInco Europe Ltd and Others v First Choice Distribution (A Firm) and Others CA 10-Sep-1998
The Court of Appeal has jurisdiction to hear an appeal against a judge’s grant or refusal of an order staying court proceedings where arbitration was sought by one party under an agreement. . .
CitedIn re Dynamics Corporation of America ChD 1976
In a compulsory winding up of an insolvent company, a creditor’s claim for a debt in a foreign currency, and any set-off in a foreign currency against such a debt, must be converted into sterling as at the date of the winding up order. The result . .
CitedBeaufort Developments (NI) Limited v Gilbert-Ash NI Limited and Others HL 26-Feb-1998
The contractual ability given to an arbitrator under standard JCT terms did not oust the court from assessing and prejudging the acts of the architect under a building contract. As to the means for interpreting documents, Lord Hoffmann said: ‘I . .
CitedIn re Whitehouse and Co CA 1878
The Court was asked whether a contributory was entitled to set off a debt due to him from the company against calls made against him both by the company before the commencement of its liquidation and by the liquidator after the commencement of its . .
CitedWhittaker v Kershaw CA 1890
A company contributory has no liability until the company concerned is wound up. . .
CitedIn re MC Bacon Ltd (No2) ChD 1991
A claim was made by the liquidator for reimbursement, out of a fund in the hands of a secured creditor, of costs, which included costs the liquidator had been ordered to pay the secured creditor following the dismissal of the action in which he . .
CitedIn re Ayala Holdings Ltd (No 2) ChD 1996
The Court was asked as to an assignment to a creditor of all rights to and choses in action relating to or in any way arising out of or in connection with an action against a secured creditor. The rights purportedly assigned included the right to . .
CitedBank of Credit and Commerce International Sa (In Liquidation) (No 8) CA 2-Oct-1996
Not all debts which were eligible for proof in bankruptcy were also eligible for a set off.
Rose Ljexplained the doctrine of equitable marshallling, saying: ‘The doctrine of marshalling applies where there are two creditors of the same debtor, . .
CitedGye v McIntyre 1-Mar-1991
High Court of Australia – Bankruptcy – Proof of debts – Set-off – Mutual dealings – Composition with creditors – Person claiming to prove debt . .
CitedGraham and Others, Assignees of Leigh, Bankrupt v Russell 25-Nov-1816
An underwriter, in an action by the assignees of a bankrupt assured, upon a loss which happened after the bankruptcy, may set off a sum due to him for premiums on the balance of accounts between the bankrupt and himself. . .
CitedForster v Wilson 1843
English law regards insolvency set off as a way of achieving substantial justice between the parties. . .
CitedStein v Blake HL 18-May-1995
Where A and B each have claims against each other and A is insolvent, the common amount is set off, and the net difference remains as a debt due.
Hoffmann L said: ‘It is a matter of common occurrence for an individual to become insolvent while . .
CitedCherry v Boultbee CA 6-Apr-1838
TB was indebted to CB, his sister, in the sum of andpound;1878. He became bankrupt, and shortly after his bankruptcy C B made her will, giving legacies of andpound;500 and andpound;2,000 to her executors, in trust to pay the interest thereof (as to . .
CitedCherry v Boultbee HL 22-Nov-1839
B died having made a will leaving a fund to pay income to A who owed her money but had been made bankrupt before the death. The debt to B remained unpaid.
Held: The liability to pay the debt and the right to receive the legacy had never tested . .
CitedIn re Overend Gurney and Co (Grissell’s case) 1866
On the insolvency of a company, no cross claim may be set off against the company member’s liability for unpaid capital, for debt. Lord Cheldmsford LC said: ‘If the amount of an unpaid call cannot be satisfied by a set-off of an equivalent portion . .
CitedOakes v Turquand hL 1867
Lord Chelmsford said: ‘it is said that everything that is stated in the prospectus is literally true, and so it is; but the objection to it is, not that it does not state the truth as far as it goes, but that it conceals most material facts with . .
CitedCambridge Gas Transport Corp v Official Committee of Unsecured Creditors (of Navigator Holdings Plc and Others) PC 16-May-2006
(Isle of Man) A scheme of arrangement was proposed for a company with involvement in several jurisdictions. An order in New York sought assistance in the vesting of shares and assets in the Isle of Man in the creditors committee. Cambridge was a . .
CitedIn re Abrahams ChD 1908
A debt was owed by the beneficiary to the estate which was payable by way of future instalments which were not due.
Held: The debt did not entitle the executors to hold back distribution of the beneficiary’s share of the estate. . .

Cited by:
CitedMT Hojgaard As v EON Climate and Renewables UK Robin Rigg East Ltd and Another SC 3-Aug-2017
The defendants had requested tenders for the design and construction of an offshore wind farm. The court now considered the situation arising because of inconsistencies between documents in the tender request. The successful tender was based upon an . .
CitedRevenue and Customs v Joint Administrators of Lehman Brothers International (Europe) SC 13-Mar-2019
The Court was asked whether interest payable under rule 14.23(7) of the Insolvency Rules 2016 is ‘yearly interest’ within the meaning of section 874 of the Income Tax Act 2007. If so, the administrators must deduct income tax before paying interest . .

Lists of cited by and citing cases may be incomplete.

Insolvency

Updated: 17 January 2022; Ref: scu.584116

In Re T Cooper: CA 2 Jun 1911

(1911) 2 KB 550, [1911] UKLawRpKQB 118
Commolii
England and Wales
Cited by:
CitedRevenue and Customs v Joint Administrators of Lehman Brothers International (Europe) SC 13-Mar-2019
The Court was asked whether interest payable under rule 14.23(7) of the Insolvency Rules 2016 is ‘yearly interest’ within the meaning of section 874 of the Income Tax Act 2007. If so, the administrators must deduct income tax before paying interest . .

Lists of cited by and citing cases may be incomplete.

Insolvency, Income Tax

Updated: 17 January 2022; Ref: scu.671256

Hellas Telecommunications (Luxembourg) Ii Sca, Joint Liquidators of v Slaughter and May (A Firm): CA 24 May 2016

The court was asked whether, where a firm of solicitors provides legal services to a company in administration, Hellas Telecommunications (Luxembourg) II SCA (‘the Company’), and the firm and the administrators agree the amount of their fees, subsequently appointed liquidators of the company can ask the companies court to assess, that is, determine the amount of, those costs, either under Rule 7.34 (as in force at the date relevant to these proceedings) of the Insolvency Rules 1986 (‘IR’) or under the inherent jurisdiction of the companies court.

Arden, Jackson, Kitchin LJJ
[2016] EWCA Civ 474
Bailii
England and Wales

Legal Professions, Insolvency

Updated: 16 January 2022; Ref: scu.564690

The Co-Operative Bank Plc v Phillips: ChD 21 Aug 2014

The bank had brought possession proceedings against the defendant under two legal charges securing personal guarantees. The proceedings had been abandoned, but the court now was asked whether costs for the defendant should be on the standard or indemnity basis. The defendant argued that the proceedings had been brought for a collateral purpose and were and abuse of process. The bank also argued that the costs should be added to the sum secured. The defendant had entered into an individual voluntary arrangement, saying also that the properties should be excluded since the prior charges themselves left him with negative equity.
Held: The bringing of the possession proceedings for the purpose of putting pressure on Mr Phillips was for the purpose of obtaining repayment of the sums secured by the charges and was therefore a permissible purpose.
As to the costs, the court applied the Gomba Holdings case. Though the proceedings were not an abuse of process, that did not mean that they were reasonable for this purpose. The defendant had shown that the bank had acted unreasonably in bringing th two sets of proceedings, and the bank should not be allowed to add the costs incurred to the mortgage debt, and was liable to him for his costs incurred, and nor was the bank entitled to set off such liability against the mortgage debt.

Morgan J
[2014] EWHC 2862 (Ch)
Bailii
Civil Procedure Rules 38.5(3) 38.6(1)
England and Wales
Citing:
CitedDownsview Nominees Ltd and Another v First City Corporation Ltd and Another PC 19-Nov-1992
(New Zealand) The holder of a second debenture appointed receivers to the assets. The first debenture holder then also appointed receivers not to obtain repayment of its debt, but to disrupt the work of the first appointed receivers and in order to . .
CitedQuennell v Maltby CA 15-Nov-1978
A house was mortgaged to a bank. The house was then let to tenants at an annual rate of andpound;1,000. The tenants were protected as against the mortgagor by the Rent Acts. The tenancy was not binding on the bank. The mortgagor’s wife took a . .
CitedRopaigealach v Barclays Bank plc CA 6-Jan-1999
The applicant’s property was charged to the defendant. At the time it was not occupied. The mortgage fell into arrears, and after serving notice at the property, the bank took posssession and sold the property at auction. The claimants said the bank . .
CitedCukurova Finance International Ltd and Another v Alfa Telecom Turkey Ltd PC 30-Jan-2013
(British Virgin Islands) The claimant sought to recover shareholdings given in charge.
Held: There was an event of default, which entitled ATT to accelerate the loan and to appropriate – or forfeit – the charged shares, but that relief against . .
CitedMeretz Investments Nv and Another v ACP Ltd and others ChD 30-Jan-2006
The applicant challenged the exercise of a power of sale under a mortgage, saying that the mortgagee’s purposes included purposes not those under the mortgage. The parties had been involved in an attempted development of a penthouse.
Held: The . .
CitedAlbany Home Loans Ltd v Massey CA 1997
It is generally not appropriate to order possession against one of two mortgagors where the order would be of no benefit to the mortgagee, particularly where the joint mortgagors were husband and wife. An ordinary order for possession might be . .
CitedGoldsmith v Sperrings Ltd CA 1977
Claims for Collateral Purpose treated as abuse
The plaintiff commenced proceedings for damages for libel and an injunction against the publishers, the editors and the main distributors of Private Eye. In addition, he issued writs against a large number of other wholesale and retail distributors . .
AppliedGomba Holdings (UK) Ltd v Minories Finance Ltd (No 2) CA 1993
A clause entitling a mortgagee to recover legal costs from the mortgagor did not extend to costs that were unreasonably incurred or which were unreasonable in amount. Whether costs were unreasonably incurred or were unreasonable in amount was to be . .
CitedBerkshire Capital Funding Limited v Street and Barker, Nationwide Building Society CA 14-Apr-1999
The court can make an order for possession in favour of the second mortgagee, subject to the rights of a prior mortgagee. Where the first mortgagee grants a tenancy of the mortgaged property, the second mortgagee will be bound by that tenancy and . .

Lists of cited by and citing cases may be incomplete.

Costs, Banking, Insolvency

Updated: 15 January 2022; Ref: scu.536007

Galbraith v Grimshaw: HL 23 Jun 1910

The appellant was a trustee in a Scottish sequestration. The respondents, who were judgment creditors of the bankrupt, had attached by a garnishee order an English debt due to the bankrupt. This security, being obtained less than sixty days before the date of the Scottish sequestration, would have been thereby cut down had it taken the form of letters of arrestment of a Scottish debt.
The Scottish trustee contested the effect of the garnishee order, and judgment against him was pronounced by the Court of Appeal (Farwell, Buckley, and Kennedy, L.JJ.). The trustee appealed.
Held: A foreign bankruptcy is recognised only from its date, and does not cut down security rights obtained before that date, although they would be cut down by the law of the foreign bankruptcy.

Lord Chancellor (Loreburn), Lords Macnaghten, James of Hereford, and Dunedin
[1910] UKHL 699, 48 SLR 699
Bailii
England and Wales

Insolvency

Updated: 13 January 2022; Ref: scu.619793

Edward Hewit, Surviving Partner of Hewit and Brockhurst v David Elliot, George M’Crae, Simon Brown, John Auld, and James Ballantine, Trustees for The Creditors of Andrew Stevenson, Merchant Glasgow: HL 6 Dec 1775

Bankruptcy – Retention – Admissibility of Witness – Interest – Tutoring.- Circumstances in which a party, having procured possession of bills in a legitimate manner, though sent for, and to be appropriated to a special purpose, was held entitled to retain these bills in payment pro tanto of his own account, against the creditors of the remitter of these bills: reversing the judgment of the Court of Session. Circumstances in which objection to examination of witness, on the ground of interest, not sustained. Also objection to witness, as having been tutored, and having perused the papers, andc., in the cause, repelled.

[1775] UKHL 2 – Paton – 381, (1775) 2 Paton 381
Bailii
Scotland

Insolvency

Updated: 13 January 2022; Ref: scu.561835

Campbell, Robertson and Co, Merchants, Glasgow v William Shepherd of London, Merchant; and Alexr and Samuel Paterson, His Mandatories: HL 8 Nov 1776

Sale – Insolvency – Arrestinq Creditors.- A party absconded from Glasgow, came to London, purchased cotton from merchants there, to whom he was a stranger, representing himself as a merchant in Glasgow in good credit, and giving references to certain parties in London, who, by previous arrangement with the buyer, spoke favourably of his credit, and induced the seller to give the cottons. Held, on proof of his insolvency, that the sale was void, and the seller entitled to reclaim his goods while in medio, and to be preferred to the creditors of the buyer arresting.

[1776] UKHL 2 – Paton – 399, (1776) 2 Paton 399
Bailii
Scotland

Insolvency

Updated: 13 January 2022; Ref: scu.561843

Messrs Annand and Colquhoun, and Their Assignees, and Messrs Gibson and Balfour, Merchants, Edinburgh, and Their Trustee v Helen Chessels or Scott, and James Scott, Her Husband: HL 24 Mar 1775

Jus Mariti – Exclusion of Do.- Where a party conveyed his heritable and moveable estate to his daughter, in trust for behoof of herself and children, excluding her husband’s jus mariti in the event of his insolvency; Held that his creditors were not entitled to claim any of his moveable estate, the same being vested in the daughter; but that they were entitled to claim the rents of the heritable, and interest of the moveable estate up to the date of the husband’s insolvency, on which event his right of administration ceased, in terms of the express provision in the settlement.

[1775] UKHL 2 – Paton – 369
Bailii
Scotland

Insolvency, Trusts

Updated: 13 January 2022; Ref: scu.561831

Lehman Brothers Luxembourg Investments Sarl v Lehman Brothers UK Holdings Ltd: ChD 21 Mar 2016

The parties asked the court to rule on a question which has arisen about the legal status of certain payments made, or expected to be made, to the Company by the administrators of its wholly-owned subsidiary, Lehman Brothers UK Holdings Limited (‘LBUKH’). The payments in question are part repayments of subordinated loans made by the Company to LBUKH under three subordinated loan facility agreements (two long term, and one short term) made between June 2004 and July 2005. The issue, in short, is whether the repayments should be held in trust for LBUKH and/or any as yet unknown creditors of LBUKH, or whether the repayments are held by the Company free from any trust and are available, in particular, for distribution to the Company’s own creditors.

Henderson J
[2016] EWHC 617 (Ch)
Bailii
England and Wales

Insolvency, Financial Services

Updated: 12 January 2022; Ref: scu.561523

Kebbell and Another v Hat and Mitre Plc and Others (As Joint Administrators of Hat and Mitre Plc): ChD 8 Oct 2020

Application by two shareholders and directors of the Company, the principal purpose of which is to obtain a determination that the Company is not, or no longer should be, in administration.

Trower J
[2020] EWHC 2649 (Ch)
Bailii
England and Wales

Company, Insolvency

Updated: 12 January 2022; Ref: scu.654540

Padwick Properties Ltd v Punj Lloyd Ltd: ChD 9 Mar 2016

The tenant had left the property, their solicitors writing informing the landlord that it had vacated the Property and asserting that ‘the security and safety of the Property will revert to your client.’ The keys were returned, and on the insolvency of the tenant, the lease was disclaimed. The landlord then required the defendant, under the guarantee to pay arrears, and enter into a new lease.
Held: There had been no surrender of the lease. The landlord’s agent had been clear that in accepting the key he did so for security and not by way of retaking possession.

Keyser QC HHJ
[2016] EWHC 502 (Ch)
Bailii
England and Wales
Citing:
CitedOastler v Henderson 1877
The tenancy was for seven years. Shortly after its creation, the tenant left the keys with the agent and asked him to dispose of it or make the best bargain for surrender he could, and left for America. A tenant not being found, the agent returned . .
CitedRelvok Properties Ltd v Dixon CA 1972
A lease was assigned to a Mr Krokidis who then departed. The landlords instructed Estate Agents to change the locks. The defendants said that that amounted to a surrender of the lease.
Held: They were wrong: ‘In my judgment Judge Irving . .
CitedEvans v James (Administratrix of the Estate of Thomas Hopkin Deceased) CA 5-Jul-1999
Before the parties called evidence, and having read the papers, the court considered that there was no real defence shown, and invited submissions. Negotiations for the grant of a tenancy had been terminated by the sudden illness of the proposed . .
CitedBellcourt Estates Ltd v Adesina CA 18-Feb-2005
The landlord sought to recover arrears of rent. The tenant said that she had surrendered the lease of the properties. The judge had held that she ceased to occupy the premises from November 2000, after which the landlord did not send a demand for . .
CitedArtworld Financial Corporation v Safaryan and Others CA 27-Feb-2009
The parties disputed whether the landlord had accepted the surrender of a lease. The tenant had handed in the keys. The landlord claimed rent for the subsequent period. The court had found surrender by operation of law, the landlord taking several . .

Lists of cited by and citing cases may be incomplete.

Landlord and Tenant, Insolvency

Updated: 11 January 2022; Ref: scu.560749

John Cathcart of London, Merchant v Alexander Blackwood, Merchant, Edinburgh: HL 26 Feb 1765

Bankruptcy – Foreign – Certificate and Discharge.-
A company in London became bankrupt, and, under the bankruptcy, obtained a certificate and discharge. Some years thereafter an action was raised by a creditor who had ranked and obtained his dividend out of the estate for payment of his debt, against the surviving partner in Scotland: Held that the discharge and certificate protected him, in terms of the 5 Geo. II. c. 30, – 70; and that concealment of property in Scotland, which did not then belong to him, was no bar to the benefit of the act.

[1765] UKHL 2 – Paton – 100, (1765) 2 Paton 100
Bailii
Scotland

Insolvency

Updated: 11 January 2022; Ref: scu.560604

Bilta (Uk) Ltd v Nazir and Others: ChD 24 Nov 2010

The company had been wound up by the Revenue on the basis that it had been used for a substantial VAT fraud. The liquidators now sued those said to have participated. A defendant denied the jurisdiction because of a disputed arbitration agreement. The claimant sought to have the defence struck out on the basis that documents had been destroyed by the defendant.
Held: The applications generally failed.

Lewison J
[2010] EWHC 3227 (Ch)
Bailii
England and Wales
Citing:
See AlsoBilta (UK) Ltd (In Liquidation) v Nazir and Others ChD 17-May-2010
The sixth defendant resisted a claim against it saying that matters between them were governed by a framework agreement which provided for matters to be resolved by arbitration. The claimant resisted, denying the arbitration agreement and saying . .
CitedLogicrose Ltd v Southend United Football Club Ltd CA 5-Feb-1988
The agent required the contractual counterparty to pay a bribe of pounds 70,000 to an offshore account.
Held: The bribe was held to be recoverable by the principal whether the principal rescinded or affirmed the contract because it was a . .
CitedLandaur Limited v Cummings and Co 4-May-1991
An inadvertent destruction of documents may have the same consequences visited on the party as a deliberate destruction. . .
CitedArrow Nominees Inc and Another v Blackledge and Others CA 22-Jun-2000
A petition had been lodged alleging unfair prejudice in the conduct of the company’s affairs. The defendants alleged that when applying for relief under section 459, the claimants had attempted to pervert the course of justice by producing forged or . .
CitedWoodhouse v Consignia Plc; Steliou v Compton CA 7-Mar-2002
The claimant continued an action brought in her late husband’s name. The action had begun under the former rules. After the new rules came into effect, the action was automatically stayed, since no progress had been made for over a year. Her . .
CitedDouglas, Zeta-Jones, Northern and Shell Plc v Hello! Ltd, Hola Sa, Junco, The Marquesa De Varela, Neneta Overseas Ltd, Ramey ChD 27-Jan-2003
The claimants sought an order striking out the defendants’ defence on the grounds that, by destroying documents, the possibility of a fair trial had been prejudiced.
Held: Refusing the order, save as to certain paragraphs of the defence, the . .

Cited by:
See AlsoBilta (UK) Ltd and Others v Nazir and Others ChD 30-Jul-2012
The company was said to have engaged in a fraud based on false European Trading Scheme Allowances, and had been wound up by the Revenue. The liquidators, in the company name, now sought recovery from former directors and associates.
Held: The . .
At first instance (2)Jetivia Sa and Another v Bilta (UK) Ltd and Others CA 31-Jul-2013
Defendants appealed against refusal of their request for a summary striking out for lack of jurisdiction, of the claims against them arising from their management of the insolvency of the first defendant. . .
At first Instance (2)Jetivia Sa and Another v Bilta (UK) Ltd and Others SC 22-Apr-2015
The liquidators of Bilta had brought proceedings against former directors and the appellant alleging that they were party to an unlawful means conspiracy which had damaged the company by engaging in a carousel fraud with carbon credits. On the . .

Lists of cited by and citing cases may be incomplete.

Insolvency, Litigation Practice

Updated: 10 January 2022; Ref: scu.560327