Re Bridgend Goldsmiths Limited and Others: ChD 1995

The High court may not exercise its jurisdiction under section 263 of the 1986 Act within a voluntary arrangement within the county court.

Judges:

Blackurne J

Citations:

[1995] BCC 226, [1995] 2 BCLD 208

Statutes:

Insolvency Act 1986 263(5)

Cited by:

FollowedIn re Sankey Furniture Ltd, ex parte Harding; Re Calorifique Limited, ex parte Betts ChD 1995
Separate applications were made by liquidators of companies in variously voluntary or compulsory liquidation and otherwise. . .
CitedIn Re Sutton (Removal of Liquidator) ChD 17-Oct-1997
The insolvency practitioner held many appointments. His partnership in a large firm of accountants ended suddenly. He did not have the resources to handle the cases, and nor could acceptable arrangements be made for him to have access to the related . .
CitedIn Re A and C Supplies Limited ChD 17-Oct-1997
Applications were made for the removal of a liquidator from several appointments in corporate nd individual insolvencies. He had been a partner in a firm and that had ceased in a way which left it impossible to work with his former partners to . .
Lists of cited by and citing cases may be incomplete.

Insolvency

Updated: 13 May 2022; Ref: scu.221558

Re Adams (AB) Builders Limited: 1991

An insolvency practitioner who had lost his power to act applied to the court to be removed from his positions as liquidator in several creditors voluntary liquidations.

Citations:

[1991] BCLC 359

Cited by:

CitedIn Re Sutton (Removal of Liquidator) ChD 17-Oct-1997
The insolvency practitioner held many appointments. His partnership in a large firm of accountants ended suddenly. He did not have the resources to handle the cases, and nor could acceptable arrangements be made for him to have access to the related . .
Lists of cited by and citing cases may be incomplete.

Insolvency

Updated: 13 May 2022; Ref: scu.221560

Marchant v Morton Down and Co: 1901

An assignment of a debt by a liquidator need not be by deed, any signed writing will be enough.

Citations:

[1901] 2 Ch 829

Cited by:

CitedFirstdale Ltd v Quinton ComC 5-Aug-2004
In the course of a long dispute, the defendant’s solicitors had indicated that they would accept service of proceedings. Just before the limitation period expired, the papers were served directly in the client. The defendants solicitors said that . .
Lists of cited by and citing cases may be incomplete.

Insolvency

Updated: 13 May 2022; Ref: scu.219110

Shepheard v Lamey: ChD 2001

An application was made for the removal of a liquidator: ‘After all, all that one has to find is some good cause why a person should not continue as a liquidator. You do not have to prove everything in sight; you do not have to prove, for example, misfeasance as such: you do not have to show more than there may well be a case of misfeasance or, indeed, incompetence.’

Judges:

Jacob J

Citations:

[2001] BPIR 939

Jurisdiction:

England and Wales

Cited by:

CitedQuickson (South and West) Limited v Stephen Mark Katz, John Stephen Kelmanson (As Joint Liquidators of Buildlead Limited) ChD 25-Aug-2004
Various applications were made in the insolvency, including for removal of the liquidators and declarations that certain payments were a fraudulent preference on the creditors.
Held: No prejudice had been shown by any procedural irregularity. . .
Lists of cited by and citing cases may be incomplete.

Insolvency

Updated: 13 May 2022; Ref: scu.216397

Marseilles Extension Rly and Land Co: 1867

The court considered the circumstances when a liquidator could be removed. The words ‘due cause’ did not require anything amounting to misconduct or personal unfitness. It was sufficient if it could be shown that it was on the whole desirable that a liquidator should be removed. It was a serious and valid objection to the liquidator’s efficiency that a considerable number of the creditors were opposed to his continuance in office: ‘I am of opinion that under the 141st section of the Act I have a discretionary power to remove the liquidators appointed by the company. The question is, what is meant by the words ‘On due cause shewn’? On one side it is contended that ‘due cause’ must be something amounting to misconduct or personal unfitness; on the other side it is contended, and I think that the contention is borne out by the case of Ex parte Pullbrook, that the Court may take all the circumstances into consideration and if it finds that it is, upon the whole, desirable that a liquidator should be removed, it may remove him.’

Judges:

Malins V-C

Citations:

(1867) LR 4 Eq 692

Statutes:

Companies Act 1862 141

Cited by:

CitedIn re Keypak Homecare Ltd ChD 1987
The court considered an application under section 108 to remove the liquidator, and reviewed the case law on the topic: ‘The section authorises the court to remove the liquidator ‘on cause shown’. That is not the same as saying ‘if the court shall . .
CitedQuickson (South and West) Limited v Stephen Mark Katz, John Stephen Kelmanson (As Joint Liquidators of Buildlead Limited) ChD 25-Aug-2004
Various applications were made in the insolvency, including for removal of the liquidators and declarations that certain payments were a fraudulent preference on the creditors.
Held: No prejudice had been shown by any procedural irregularity. . .
Lists of cited by and citing cases may be incomplete.

Insolvency

Updated: 13 May 2022; Ref: scu.215938

Halliard Property Co Ltd v Jack Segal Ltd: 1978

The court considered a proviso for re-entry that: ‘forfeiture on the bankruptcy of the lessee is considered as a case of breach of condition.’
Held: It was clearly a condition rather than a mere covenant of the original protected tenancy that the tenant should not become a bankrupt and this condition had been broken by the tenant. The court declined an application to amend to rely upon a fresh ground of forfeiture (namely bankruptcy) when no notice under section 146 Law of Property Act 1925 had been served before the commencement of the proceedings.

Judges:

Goulding J

Citations:

[1978] 1 WLR 377, [1978] 1 All ER 1219

Jurisdiction:

England and Wales

Cited by:

CitedCadogan Estates Limited v McMahon HL 26-Oct-2000
When a tenancy was terminated and was followed by a statutory tenancy, a term in the contractual tenancy that the tenancy should be forfeit on the tenant’s bankruptcy was continued in and inherited by the statutory tenancy. Though perhaps in . .
CitedMidtown Ltd v City of London Real Property Company Ltd ChD 20-Jan-2005
Tenants occupied land next to land which was to be developed after compulsory acquisition. The tenants and the landlords asserted a right of light over the land, and sought an injunction to prevent the development. The developer denied that any . .
Lists of cited by and citing cases may be incomplete.

Landlord and Tenant, Insolvency

Updated: 13 May 2022; Ref: scu.196913

In re Anglo American Insurance Ltd: 2001

Judges:

Neuberger J

Citations:

[2001] BCLC 755

Jurisdiction:

England and Wales

Cited by:

CitedIn re Telewest Communications Plc ChD 26-Apr-2004
A scheme of arrangement had been proposed. The creditor complained that in providing for payment in a currency other than that agreed, it had been prejudiced.
Held: The provision in the scheme did purport to alter the claimant’s rights. . .
Lists of cited by and citing cases may be incomplete.

Company, Insolvency

Updated: 13 May 2022; Ref: scu.197909

Paterson v Aggio: CA 1987

The Court considered whether a tenancy was a ‘protected shorthold tenancy’ within the meaning of section 52 of the Housing Act 1980 and therefore excluded from the protection of the Rent Act 1977.
Held: A power to forfeit within the minimum year tenancy for the bankruptcy of the tenant, was not to be taken to mean it was not a shorthold tenancy. ‘although on a strict construction’ it could be said that ‘the requirement not to become a bankrupt was not an ‘obligation’ on the tenant’, this would defeat the plain intention of the legislature. ‘ and ‘if a tenant under the terms of the tenancy agreement with which we are concerned went bankrupt, this must amount to a breach by him of an obligation or a term or condition of the tenancy and, in the context of the Rent Acts, would entitle the landlord to possession under Case 1 of Schedule 15 to the 1977 Act.’

Judges:

May LJ

Citations:

[1987] 2 EGLR 127

Statutes:

Housing Act 1980 52, Rent Act 1977 Sch 15 C 1

Citing:

CitedIn re Drew (A Bankrupt) 1929
(Ireland) A tenant subject to a re-entry clause in his tenancy agreement in the case of his being made bankrupt, and who had gone bankrupt had broken an obligation of his tenancy. He was not protected from an order for possession. ‘The tenant here . .

Cited by:

CitedCadogan Estates Limited v McMahon HL 26-Oct-2000
When a tenancy was terminated and was followed by a statutory tenancy, a term in the contractual tenancy that the tenancy should be forfeit on the tenant’s bankruptcy was continued in and inherited by the statutory tenancy. Though perhaps in . .
Lists of cited by and citing cases may be incomplete.

Landlord and Tenant, Insolvency, Housing

Updated: 13 May 2022; Ref: scu.196910

In re D H Curtis (Builders) Ltd: ChD 1978

Debts were, on the one side, the liability of the company to the Inland Revenue and the Department of Health and Social Security for PAYE and National Insurance contribution respectively and, on the other, the liability of HM Customs and Excise to the company for excess input VAT. All the debts were due and payable at the insolvency date.
Held: The court rejected an argument that the mutuality required by the statute meant that the claims sought to be set off ‘must be such as result in pecuniary liabilities arising out of contract’. He said that the type of acts or events giving rise to the liabilities were immaterial provided that those liabilities were ‘commensurable’, that is to say, capable of being expressed in money.

Judges:

Brightman J

Citations:

[1978] Ch 162

Jurisdiction:

England and Wales

Cited by:

CitedSecretary of State for Trade and Industry v Frid HL 13-May-2004
The company went into insolvent liquidation. The secretary of state was to make payments to employees and there were other state preferential creditors. At the same time a refund of VAT was due from the Commissioners of customs and Excise.
Lists of cited by and citing cases may be incomplete.

Insolvency

Updated: 13 May 2022; Ref: scu.196881

In re Camden Brewery: 1911

Citations:

[1911] 106 LT 598

Cited by:

AppliedIn Re Portbase Clothing Ltd; Mould v Taylor 1993
The company had given two debentures, one fixed and one floating. Their priority was fixed by a deed of priority. On insolvency the liquidator sought direction as to the application of the assets.
Held: The deed made the bank’s floating charge . .
Lists of cited by and citing cases may be incomplete.

Insolvency

Updated: 13 May 2022; Ref: scu.195882

In re Glyncorrwg Colliery Co Ltd: 1926

In a receivership the costs of the receivership (including the cost of realising the property comprised in the charge) had priority to the claims of the charge holder. The preferential payments must be paid before the debenture holders ‘but not before the costs of liquidation’.

Citations:

[1926] Ch 951

Cited by:

CitedBuchler and another (as joint liquidators of Leyland DAF Limited) v Talbot and another (as joint administrative receivers of Leyland DAF Limited) and Stichting Ofasec and others HL 4-Mar-2004
The liquidator sought to recover his expenses from assets charged under a floating charge in priority to the chargee.
Held: Barleycorn was decided in error. The liquidators costs incurred in an insolvent winding up were not to be charged . .
Lists of cited by and citing cases may be incomplete.

Company, Insolvency

Updated: 13 May 2022; Ref: scu.194250

Re Abbey Leisure: CA 1990

A minority shareholder had brought a petition to wind up the company, saying the project for which it had been created was complete. An offer was made to purchase his shares. He rejected the offer to purchase his shareholding at an accountant’s valuation. He appealed a striking out of his petition on the grounds that his rejection was unreasonable.
Held: Appeal allowed. The accountant’s offer would include some discount for the fact that the shares were in a minority shareholding, and he would achieve a better figure by the machinery available in a winding up.

Citations:

[1990] BCLC 342 CA, [1990] BCC 60

Statutes:

Insolvency Act 1986 125(2)

Jurisdiction:

England and Wales

Cited by:

CitedCVC/Opportunity Equity Partners Limited and Opportunity Invest II Limited v Luis Roberto Demarco Almeida PC 21-Mar-2002
(Cayman Islands) The respondent was a minority shareholder. An offer was made to buy out his interest. He petitioned for the winding up of the company on the just and equitable ground. The claimants obtained an injunction to prevent him doing so, . .
Lists of cited by and citing cases may be incomplete.

Company, Insolvency

Updated: 13 May 2022; Ref: scu.192621

Re Sperrin Textiles Ltd: 1992

Citations:

[1992] NI 323

Citing:

AppliedSiebe Gorman and Co Ltd v Barclays Bank Ltd ChD 1979
It was possible to create a fixed charge over present and future book debts and on its true construction, the debenture granted to Barclays Bank Ltd in this case had done so. If the chargor of book debts, having collected the book debts, ‘[had] had . .

Cited by:

CoubtedNational Westminster Bank Plc v Spectrum Plus Ltd and others ChD 15-Jan-2004
The company granted a debenture to the claimant purporting to secure its book debts. The company went into liquidation. The liquidator challenged the bank’s charge.
Held: Siebe was wrongly decided. The charge was ineffective over the book . .
Lists of cited by and citing cases may be incomplete.

Insolvency

Updated: 13 May 2022; Ref: scu.191961

William Gaskell Ltd v Highley: 1994

Judges:

Morritt J

Citations:

[1994] 1 BCLC 197

Citing:

AppliedSiebe Gorman and Co Ltd v Barclays Bank Ltd ChD 1979
It was possible to create a fixed charge over present and future book debts and on its true construction, the debenture granted to Barclays Bank Ltd in this case had done so. If the chargor of book debts, having collected the book debts, ‘[had] had . .
FollowedIn Re Keenan Bros Ltd 1986
(Supreme Court of the Republic of Ireland) A debenture conferred a fixed charge on book debts. It specifically provided that withdrawals from the account to which the proceeds of the book debts had to be credited might only be made with the prior . .

Cited by:

DoubtedNational Westminster Bank Plc v Spectrum Plus Ltd and others ChD 15-Jan-2004
The company granted a debenture to the claimant purporting to secure its book debts. The company went into liquidation. The liquidator challenged the bank’s charge.
Held: Siebe was wrongly decided. The charge was ineffective over the book . .
CitedNational Westminster Bank plc v Spectrum Plus Limited and others HL 30-Jun-2005
Former HL decision in Siebe Gorman overruled
The company had become insolvent. The bank had a debenture and claimed that its charge over the book debts had become a fixed charge. The preferential creditors said that the charge was a floating charge and that they took priority.
Held: The . .
Lists of cited by and citing cases may be incomplete.

Insolvency

Updated: 13 May 2022; Ref: scu.191963

In re Majory, a debtor: CA 1955

The debtor challenged the bankruptcy petition and receiving order saying that the creditor had attempted in connection with the proceedings to extort andpound;8 15s from the debtor in excess of the sums lawfully due under a court judgment. He said that this was ‘extortion’ in bankruptcy law, ie the oppressive use or threat of proceedings in order to obtain some collateral advantage, such that the court would not permit the creditor to make use of the process which he had abused.
Held: The court considered, obiter, the issue of a strike out of an action as an abuse of process.
Lord Evershed MR said: ‘The so-called ‘rule’ in bankruptcy is, in truth, no more than an application of a more general rule that court proceedings may not be used or threatened for the purpose of obtaining for the person so using or threatening them some collateral advantage to himself, and not for the purpose for which such proceedings are properly designed and exist, and a party so using or threatening proceedings will be liable to be held guilty of abusing the process of the court and therefore disqualifed from invoking the powers of the court by proceedings he has abused.’

Judges:

Lord Evershed MR

Citations:

[1955] Ch 600

Jurisdiction:

England and Wales

Cited by:

ApprovedSpeed Seal Ltd v Paddington CA 1985
The court was asked whether the defendant should be permitted to add to his pleadings a counterclaim asserting that the action was brought in bad faith for the ulterior motive of damaging the defendants’ business, and not for the protection of any . .
CitedPitman Training Ltd and Another v Nominet UK and Another ChD 22-May-1997
The defendant had received a request to register the domain name ‘pitman.co.uk’ from the claimants, who held the trade mark. The domain was not activated, and was de-registered by the defendants and then re-registered by another company. Action 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 . .
CitedHays Plc v Hartley QBD 17-May-2010
Mr Hartley operated a news agency, and provided to the publisher of the Sunday Mirror, MGN Ltd, allegations of racism that had been levelled at the claimant company by former employees. The allegations were reported in an article headed ”KKK . .
Lists of cited by and citing cases may be incomplete.

Litigation Practice, Insolvency

Updated: 13 May 2022; Ref: scu.190158

Pulsford v Devenish: ChD 1903

The liquidator in a voluntary liquidation negligently failed to inform the company’s creditors of the liquidation, and distributed the company’s assets to its contributories without regard to the creditors’ claims. The company was later dissolved.
Held: The creditors had a claim against the liquidator. The availability of the statutory remedy of a creditor under section 10 and the statutory right of a creditor to apply in a voluntary liquidation under section 138 ceased to exist when the company was dissolved. ‘But the duty to pay the debts is an absolute statutory duty, without limit in point of time and with no provision for the release of the voluntary liquidator.
It is not necessary to resort to trusteeship or equitable doctrines: the case is one of a duty imposed by a statute on an individual for the benefit of a class of persons, namely, creditors and the only peculiarity of the case is that the remedy created by the statute is not co-extensive in point of time with the duty, for the Act permits the destruction of the remedy before the duty has been performed.
Now the principles applicable to such a duty as I have mentioned are well settled and rest on the well-founded assumption that the Legislature does not intend its enactment to be brutum fulmen: if, therefore, a statute creates such a duty but no remedy, an action at common law (in former days action on the case) will lie for breach of such duty.’ and ‘It was urged in argument that the liquidator is merely the agent of the company; but assuming this to be so, I can see nothing inconsistent in the imposition on such agent of a duty to the company’s creditors.’

Judges:

Farwell J

Citations:

[1903] 2 Ch 625

Statutes:

Companies Act 1890 10 138

Jurisdiction:

England and Wales

Citing:

DistinguishedKnowles v Scott 1891
A company’s voluntary liquidator is the company’s agent and no action lies against for delay him save in the case of misfeasance or wilful misconduct. He is not a trustee for the creditors or contributories of a company in liquidation. Nor does he . .

Cited by:

CitedOldham and others v Georgina Kyrris and Another CA 4-Nov-2003
The claimant sought to bring a claim against the administrators of a partnership alleging a duty of care to creditors.
Held: Such an administrator owed no greater duty to creditors than would a director. That duty was no different whether the . .
CitedA and J Fabrications (Batley) Ltd v Grant Thornton and Others ChD 1998
The plaintiffs, the majority creditors of a company in liquidation, alleged that they had agreed with Grant Thornton, the defendants, to support the appointment of one of the firm’s partners or employees as liquidator of the company, with a view to . .
Lists of cited by and citing cases may be incomplete.

Insolvency, Professional Negligence, Company

Updated: 12 May 2022; Ref: scu.190147

Sharpe Re, Ex parte Trustee of the Bankrupt v Sharpe: ChD 30 Jul 1979

A couple lived in a maisonette with their aunt. The property had been purchased in the name of the husband but the aunt had contributed a partial sum towards the purchase price, while the rest of the amount was raised by way of a mortgage. The couple subsequently went bankrupt and the aunt claimed to be entitled to a proprietary interest in the maisonette by means of a resulting trust presumed from her contribution to the purchase price.
Held: The money had in fact been advanced by way of a loan with the intention that it be repaid. She was, therefore, not entitled to any share of the equitable interest of the property. Monies advanced by way of loan are not, on this basis alone to be treated as contributions to the purchase price of property so that the lender acquires a beneficial interest in that property as a result.
A constructive trust will be treated as coming into existence at the time of the conduct which gives rise to the trust.
Browne-Wilkinson J said: ‘I will first consider whether she has established an equitable interest in the property and its proceeds of sale by virtue of having provided the bulk of the purchase money, that is to say, has she an interest under a resulting trust? I have no doubt that she has not established any such interest. It is clear that the parties never worked out in any detail what was the legal relationship between them, but no one has suggested that Mrs. Johnson advanced the money to the debtor otherwise than by way of gift or loan. In his public examination, the debtor suggested that the monies were a gift, but I find as a fact that the monies were advanced by way of loan.’

Judges:

Browne-Wilkinson J

Citations:

[1980] 1 WLR 219, (1980) 39 P and CR 459, [1980] 1 All ER 190

Jurisdiction:

England and Wales

Cited by:

CitedTackaberry and Another v Hollis and others ChD 13-Nov-2007
A house had been purchased in 1982 by one member of a large family. Other family members now disputed whether the land was held in trust for them. A constructive trust was asserted.
Held: The claimants had failed to establish that a . .
Lists of cited by and citing cases may be incomplete.

Insolvency, Land, Trusts

Updated: 12 May 2022; Ref: scu.190151

In re Downer Enterprises Ltd: ChD 1974

The company was the assignee of a lease. The rent appears to have been payable in advance on the usual quarter days. The company went into liquidation in November 1971. At some time before April 1972 the liquidator instructed agents to market the lease and it was assigned to a purchaser in January 1973. Rent had been accruing due since the liquidation.
Held: Sir John Pennycuick V-C said: ‘Given those facts, it seems to me that from the date when he gave instructions to find a purchaser – that is some date in the early spring of 1972 – the liquidator must be treated as having remained in possession of this property with a view to the realisation of the property to the best available advantage, or, in other words, he must be treated as having kept the property in order to sell it or do the best he could with it. It is immaterial, I think, in considering the purpose for which the liquidator retained the property that, having regard to the amount of the rent and the amount which he expected to realise upon a sale of the property, it might have been more advantageous to him and to his trust estate to have realised it at an earlier date.
Given those facts, it seems to me that, applying well established principles, I must hold that Prudential, if it had not been put in funds by Granada, or Schick through Granada, would have been entitled to be paid, as an expense of the liquidation, rent for approximately one year. That would cover the four quarter days at the end of March, June, September and December 1972.’

Judges:

Sir John Pennycuick V-C

Citations:

[1974] 1 WLR 1460

Jurisdiction:

England and Wales

Cited by:

CitedKahn and Another v Commissioners of Inland Revenue; In re Toshoku Finance plc HL 20-Feb-2002
A company went into liquidation, being owed substantial sums by another company in the same group, but itself insolvent. A settlement did not include accrued interest, but was claimed to be taxed as if it had, and on an accruals basis. If so, was . .
CitedWright and Another (Liquidators of SHB Realisations Ltd) v The Prudential Assurance Company Ltd ChD 6-Mar-2018
IVA is a special form of contract
Liquidators asked the court whether sums sought by the insolvent company’s landlords were payable and or provable. Under an IVA, the copany had been paying reduced rents, but the arrangement document provided that the full rents would be restored on . .
Lists of cited by and citing cases may be incomplete.

Insolvency, Landlord and Tenant

Updated: 12 May 2022; Ref: scu.190100

Re HH Realisations Ltd: ChD 1975

The liquidator of a company ceased to be liable to pay the rent under the company’s lease in full from the time it gave notice to the landlord that it was seeking authority to disclaim the lease, even though it remained in occupation for nearly two months longer.

Judges:

Templeman J

Citations:

(1975) 31 P and CR 249

Jurisdiction:

England and Wales

Cited by:

CitedKahn and Another v Commissioners of Inland Revenue; In re Toshoku Finance plc HL 20-Feb-2002
A company went into liquidation, being owed substantial sums by another company in the same group, but itself insolvent. A settlement did not include accrued interest, but was claimed to be taxed as if it had, and on an accruals basis. If so, was . .
CitedWright and Another (Liquidators of SHB Realisations Ltd) v The Prudential Assurance Company Ltd ChD 6-Mar-2018
IVA is a special form of contract
Liquidators asked the court whether sums sought by the insolvent company’s landlords were payable and or provable. Under an IVA, the copany had been paying reduced rents, but the arrangement document provided that the full rents would be restored on . .
Lists of cited by and citing cases may be incomplete.

Landlord and Tenant, Insolvency

Updated: 12 May 2022; Ref: scu.190099

Knowles v Scott: 1891

A company’s voluntary liquidator is the company’s agent and no action lies against for delay him save in the case of misfeasance or wilful misconduct. He is not a trustee for the creditors or contributories of a company in liquidation. Nor does he have liability as a trustee dealing with his cestui que trust. Without proof of misfeasance or wilful misconduct no action will lie against him for a delay in distributing the assets of the company. Romer J said: ‘In my view a voluntary liquidator is more rightly described as the agent of the company – an agent who has no doubt cast upon him by statute or otherwise special duties . . If this be the true position of a liquidator, and I think at any rate agency more nearly defines his true position than trusteeship, it is clear that he could not as agent be sued by a third party for negligence apart from misfeasance or personal misconduct.’

Judges:

Romer J

Citations:

[1891] 1 Ch 717, [1891] 60 LJ Ch 284, [1891] 64 LT 135, [1891] WR 523, [1891] 7 TLR 306

Jurisdiction:

England and Wales

Cited by:

CitedOldham and others v Georgina Kyrris and Another CA 4-Nov-2003
The claimant sought to bring a claim against the administrators of a partnership alleging a duty of care to creditors.
Held: Such an administrator owed no greater duty to creditors than would a director. That duty was no different whether the . .
DistinguishedPulsford v Devenish ChD 1903
The liquidator in a voluntary liquidation negligently failed to inform the company’s creditors of the liquidation, and distributed the company’s assets to its contributories without regard to the creditors’ claims. The company was later dissolved. . .
Lists of cited by and citing cases may be incomplete.

Insolvency, Professional Negligence, Company

Updated: 12 May 2022; Ref: scu.190145

In re National Arms and Ammunition Co: CA 1885

‘If the company retains the possession of property which would be rateable in the hands of anyone else, it is only reasonable that it should be rateable in the hands of the company . . the true test is whether there has been a beneficial occupation within the ordinary meaning of those words in cases as to rating.’

Judges:

Bowen and Fry LJJ

Citations:

(1885) 28 Ch D 474

Jurisdiction:

England and Wales

Citing:

DisapprovedIn re Watson, Kipling and Co ChD 1883
An assessment for rates had been made after the liquidation of the company upon property occupied by the company. The court rejected the submission of counsel for the rating authority that: ‘where a liability is incurred during the winding-up, that . .

Cited by:

CitedKahn and Another v Commissioners of Inland Revenue; In re Toshoku Finance plc HL 20-Feb-2002
A company went into liquidation, being owed substantial sums by another company in the same group, but itself insolvent. A settlement did not include accrued interest, but was claimed to be taxed as if it had, and on an accruals basis. If so, was . .
AppliedIn re Blazer Fire Lighter Ltd 1895
The liquidator had closed the business and done nothing on the premises except to instal a caretaker to protect them from vandalism. That was sufficient to continue the company in rateable occupation. So the rates were an expense of the liquidation. . .
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 . .
Lists of cited by and citing cases may be incomplete.

Insolvency, Rating

Updated: 12 May 2022; Ref: scu.190101

In re Blazer Fire Lighter Ltd: 1895

The liquidator had closed the business and done nothing on the premises except to instal a caretaker to protect them from vandalism. That was sufficient to continue the company in rateable occupation. So the rates were an expense of the liquidation.

Judges:

Vaughan-Williams J

Citations:

[1895] 1 Ch 402

Jurisdiction:

England and Wales

Citing:

AppliedIn re National Arms and Ammunition Co CA 1885
‘If the company retains the possession of property which would be rateable in the hands of anyone else, it is only reasonable that it should be rateable in the hands of the company . . the true test is whether there has been a beneficial occupation . .

Cited by:

CitedKahn and Another v Commissioners of Inland Revenue; In re Toshoku Finance plc HL 20-Feb-2002
A company went into liquidation, being owed substantial sums by another company in the same group, but itself insolvent. A settlement did not include accrued interest, but was claimed to be taxed as if it had, and on an accruals basis. If so, was . .
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 . .
Lists of cited by and citing cases may be incomplete.

Insolvency, Rating

Updated: 12 May 2022; Ref: scu.190102

James Smith and Sons (Norwood) Ltd v Goodman: CA 1936

Two leases had been granted by the plaintiff to a company. Subsequently the company determined the leases but it had previously assigned the leases to a third party. The company went into liquidation and the liquidator distributed its assets. He failed to provide for future rent due to the plaintiffs under the leases. No notice of the voluntary liquidation was given to creditors. The company was subsequently dissolved. The plaintiffs were unaware of the liquidation or of the subsequent dissolution.
Held: The liquidator was liable in damages to creditors for breach of statutory duty. The liability under those two leases were liabilities which ought to have been admitted to proof by the liquidator. (Affirmed on appeal) Lord Harworth MR said: ‘The cases that we have looked at are sufficient to show that if a creditor has been injured by the failure of the liquidator to take the steps that he ought to have taken, and has suffered damage, he can ‘succeed on an action on the case’ . . in establishing a liability against a liquidator.’

Judges:

Bennett J, Lord Harworth MR

Citations:

[1936] Ch 216

Jurisdiction:

England and Wales

Cited by:

CitedOldham and others v Georgina Kyrris and Another CA 4-Nov-2003
The claimant sought to bring a claim against the administrators of a partnership alleging a duty of care to creditors.
Held: Such an administrator owed no greater duty to creditors than would a director. That duty was no different whether the . .
CitedA and J Fabrications (Batley) Ltd v Grant Thornton and Others ChD 1998
The plaintiffs, the majority creditors of a company in liquidation, alleged that they had agreed with Grant Thornton, the defendants, to support the appointment of one of the firm’s partners or employees as liquidator of the company, with a view to . .
Lists of cited by and citing cases may be incomplete.

Insolvency, Negligence

Updated: 12 May 2022; Ref: scu.190148

In re ABC Coupler and Engineering Co Ltd (No 3): ChD 1970

The liquidator when appointed closed down the business which had been conducted on the premises, had the company’s plant and machinery valued and thought about what he should do.
Held: The rent did not become a liquidation expense until some time after the winding up order, notwithstanding that the company remained in occupation. He was due to pay rent from the time he decided to put the lease on the market. He was from that point retaining the premises for the benefit of the winding up and was liable to pay the rent in full.

Judges:

Plowman J

Citations:

[1970] 1 WLR 702

Jurisdiction:

England and Wales

Cited by:

CitedKahn and Another v Commissioners of Inland Revenue; In re Toshoku Finance plc HL 20-Feb-2002
A company went into liquidation, being owed substantial sums by another company in the same group, but itself insolvent. A settlement did not include accrued interest, but was claimed to be taxed as if it had, and on an accruals basis. If so, was . .
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 . .
CitedWright and Another (Liquidators of SHB Realisations Ltd) v The Prudential Assurance Company Ltd ChD 6-Mar-2018
IVA is a special form of contract
Liquidators asked the court whether sums sought by the insolvent company’s landlords were payable and or provable. Under an IVA, the copany had been paying reduced rents, but the arrangement document provided that the full rents would be restored on . .
Lists of cited by and citing cases may be incomplete.

Insolvency, Landlord and Tenant

Updated: 12 May 2022; Ref: scu.190098

In re Atlantic Computer Systems Plc: CA 1992

The chargor was a company which arranged with the chargee, a funding bank, that it should purchase equipment and let it on hire purchase to the chargor with permission to sub-lease to end users. The chargor charged to the chargee by way of security all the benefit of the terms of each of the specific sub-leases involved and, in particular, the rentals due under them. The chargor later went into administration and the issue arose as to whether the charges were fixed or floating charges. The court was also asked whether rental due under hire purchaser agreements should be treated as an expense of administration.
Held: To be treated as liquidation expenses under the rules, an expense had to meet the ‘liquidation expenses’ principle of fairness. If a liability was incurred as a result of a step taken for the benefit of the insolvent estate, it was fair that the burden should be borne by the persons for whose benefit the estate was being administered. A creditor could ordinarily be given leave to execute against the company’s assets for a ‘new debt incurred by the liquidator for the purposes of the liquidation’ ‘it is just and equitable that the burden of the debt should be borne by those for whose benefit the insolvent estate is being administered.’ It was a corollary of this principle that a debt was incurred for the purposes of the liquidation ought to be paid in full as an expense of the liquidation. ‘The latter principle is not confined to new debts incurred by the liquidator. It applies also to continuing obligations under existing contracts such as leases which the liquidator chooses to continue for the benefit of the winding up.’ As to the question of whether a fixed charge had been created: ‘in practice sums payable by the end users under these sub-leases were paid to the company and utilised by it in the ordinary course of business. In so far as this is relevant, it may well be that this was what the parties intended should happen. The company was to be at liberty to receive and use the instalments until AIB chose to intervene. We are unpersuaded that this results in these charges, on existing and defined property, becoming floating charges. A mortgage of land does not become a floating charge by reason of the mortgagor being permitted to remain in possession and enjoy the fruits of the property charged for the time being.’

Judges:

Nicholls LJ

Citations:

[1992] Ch 505

Jurisdiction:

England and Wales

Citing:

CitedIn re Lundy Granite Co; Ex parte Heavan CA 1871
The landlord of Lundy Island, which was let to a third party, distrained upon goods of the company which had been left upon the tenant’s property. The distraint was for rent which had fallen due more than a year after the winding up order. The . .

Cited by:

CitedKahn and Another v Commissioners of Inland Revenue; In re Toshoku Finance plc HL 20-Feb-2002
A company went into liquidation, being owed substantial sums by another company in the same group, but itself insolvent. A settlement did not include accrued interest, but was claimed to be taxed as if it had, and on an accruals basis. If so, was . .
AppliedIn Re Kentish Homes Ltd ChD 31-Mar-1993
The question was whether a post-liquidation liability to community charge on empty flats was an expense of the liquidation.
Held: The company was the chargeable person in respect of the flats for the relevant periods, but the liability was . .
AppliedRe Atlantic Medical Ltd 1992
A charge was granted over hire-purchase agreements, sub-leases and rentals of leased equipment. The charge extended to such agreements as the chargor might enter into in the future.
Held: Applying Atlantic computers, the charge was a fixed . .
CitedNational Westminster Bank Plc v Spectrum Plus Ltd; In re Spectrum Plus CA 26-May-2004
The court was asked whether a charge given over book debts in a debenture was floating or fixed.
Held: Since the charge asserted some control over receipt of the payments, it was a fixed charge. Upon payment into the account, title to the . .
CitedFreakley and others v Centre Reinsurance International Company and others HL 11-Oct-2006
When it became clear that the company would be financially overwhelmed by asbestos related claims, a voluntary scheme of arrangement was proposed under s425. The House was now asked whether the right to re-imbursement of the company’s lawyers after . .
Lists of cited by and citing cases may be incomplete.

Insolvency

Updated: 12 May 2022; Ref: scu.190091

Hardy v Fothergill: 1888

Rent falling due after a winding up of the tenant was a future debt for which the landlord could have proved in the tenant’s liquidation.

Citations:

(1888) 13 App Cas 351

Jurisdiction:

England and Wales

Cited by:

CitedKahn and Another v Commissioners of Inland Revenue; In re Toshoku Finance plc HL 20-Feb-2002
A company went into liquidation, being owed substantial sums by another company in the same group, but itself insolvent. A settlement did not include accrued interest, but was claimed to be taxed as if it had, and on an accruals basis. If so, was . .
CitedIn Re Park Air Services Plc; Christopher Moran Holdings Ltd v Bairstow and Another HL 4-Feb-1999
The tenant company went into liquidation, the receiver disclaimed the lease, and the landlord claimed compensation under the Act. The question concerned how the compensation was to be calculated.
Held: Where a solvent tenant under an onerous . .
Lists of cited by and citing cases may be incomplete.

Insolvency, Landlord and Tenant

Updated: 12 May 2022; Ref: scu.190096

In re M C Bacon Ltd: ChD 1990

A liquidator claimed that the costs of an unsuccessful attempt to set a floating charge aside should be paid out of the assets subject to the charge in priority to the claims of the charge holder.
Held: The rule was a complete statement of the possible expenses to be paid out under the rules: ‘The expenses of the winding up and the order on which they are payable out of the assets are listed in rule 4.218(c).’ S238 requires a comparison of incoming value, assessed in money or money’s-worth with outgoing value assessed in money or money’s-worth from the point of view of the insolvent estate.’ and ‘To come within that paragraph [238(4)] the transaction must be (i) entered into by the company; (ii) for a consideration; (iii) the value of which is measured in money or money’s worth; (iv) is significantly less than the value; (v) also measured in money or money’s worth; (vi) of the consideration provided by the company. It requires a comparison to be made between the value obtained by the company for the transaction and the value of [the] consideration provided by the company. Both values must be measurable in money or money’s worth and both must be considered from the company’s point of view.’ The grant of security cannot constitute a transaction at an undervalue.
Millett J: ‘The mere creation of a security over a company’s assets does not deplete them and does not come within the paragraph. By charging its assets the company appropriates them to meet the liabilities due to the secured creditor and adversely affects the rights of other creditors in the event of insolvency. But it does not deplete its assets or diminish their value. It retains the right to redeem and the right to sell or remortgage the charged assets. All it loses is the ability to apply the proceeds otherwise than in satisfaction of the secured debt. That is not something capable of valuation in monetary terms and is not customarily disposed of for value. In the present case the company did not suffer that loss by reason of the grant of the debenture. Once the bank had demanded a debenture the company could not have sold or charged its assets without applying the proceeds in reduction of the overdraft; had it attempted to do so, the bank would at once have called in the overdraft. By granting the debenture the company parted with nothing of value, and the value of the consideration which it received in return was incapable of being measured in money or money’s worth.’

Judges:

Millett J

Citations:

[1991] Ch 127, [1990] BCLC 324

Statutes:

Insolvency Act 1986 238

Jurisdiction:

England and Wales

Citing:

At trialRe: A Company (No. 005009 of 1987), ex parte Copp ChD 1988
MC Bacon Ltd had borrowed money from a bank. The loan was unsecured. The company got into financial difficulty. The bank commissioned a report on the company’s financial affairs; and insisted on the grant of a debenture to secure the company’s . .

Cited by:

CitedKahn and Another v Commissioners of Inland Revenue; In re Toshoku Finance plc HL 20-Feb-2002
A company went into liquidation, being owed substantial sums by another company in the same group, but itself insolvent. A settlement did not include accrued interest, but was claimed to be taxed as if it had, and on an accruals basis. If so, was . .
CitedBuchler and another (as joint liquidators of Leyland DAF Limited) v Talbot and another (as joint administrative receivers of Leyland DAF Limited) and Stichting Ofasec and others HL 4-Mar-2004
The liquidator sought to recover his expenses from assets charged under a floating charge in priority to the chargee.
Held: Barleycorn was decided in error. The liquidators costs incurred in an insolvent winding up were not to be charged . .
CitedRe Thoars (Dec’d); Reid v Ramlort Ltd ChD 2003
The company claimed the benefit of an insurance policy. They had paid certain premiums and the trustee had made a declaration that it was held on trust for the company. The insured died in Scotland, intestate and insolvent.
Held: The . .
CitedRamlort Ltd v Michael James Meston Reid CA 8-Jul-2004
The company sought to claim under a life policy. The deceased had died in Scotland insolvent. The trustee of the policy had declared that he held it on trust for the claimant, but the defendant, the judicial factor of the estate, said the . .
CitedUltraframe (UK) Ltd v Fielding and others ChD 27-Jul-2005
The parties had engaged in a bitter 95 day trial in which allegations of forgery, theft, false accounting, blackmail and arson. A company owning patents and other rights had become insolvent, and the real concern was the destination and ownership of . .
CitedFeakins and Another v Department for Environment Food and Rural Affairs (Civ 1513) CA 9-Dec-2005
The department complained that the defendants had entered into a transaction with their farm at an undervalue so as to defeat its claim for recovery of sums due. The transaction used the grant of a tenancy by the first chargee.
Held: The . .
CitedHill (As Trustee In Bankruptcy of Nurkowski) v Spread Trustee Company Ltd and Another CA 12-May-2006
The defendants sought relief for transactions entered into at an undervalue. The bankrupt had entered into charges and an assignment of a loan account in their favour before his bankruptcy, and the trustee had obtained an order for them to be set . .
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 . .
Lists of cited by and citing cases may be incomplete.

Insolvency

Updated: 12 May 2022; Ref: scu.190092

In re Mesco Properties Ltd: CA 1980

Tax legislation provided that the company was chargeable to corporation tax on a capital gain arising in the winding up.
Held: The appeal failed. It was a tax which the liquidator was bound to discharge by payment, and the payment was a ‘necessary disbursement’ for the purposes of the winding-up rules.

Judges:

Buckley LJ, Bridge LJ, Templeman LJ

Citations:

[1980] 1 WLR 96

Jurisdiction:

England and Wales

Citing:

Appeal fromIn re Mesco Properties Ltd ChD 1979
The court considered whether corporation tax had to be paid as an expense of the liquidation in priority to other claims. In that case it had arisen not on profits but on chargeable gains, on sales of the company’s properties after the commencement . .

Cited by:

CitedKahn and Another v Commissioners of Inland Revenue; In re Toshoku Finance plc HL 20-Feb-2002
A company went into liquidation, being owed substantial sums by another company in the same group, but itself insolvent. A settlement did not include accrued interest, but was claimed to be taxed as if it had, and on an accruals basis. If so, was . .
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 . .
Lists of cited by and citing cases may be incomplete.

Corporation Tax, Insolvency

Updated: 12 May 2022; Ref: scu.190090

Coulter v Chief Constable of Dorset Police: ChD 12 Dec 2003

The claimant had failed in an action for damages against the respondent, and had failed to pay the costs award. The respondent issued a statutory demand. He claimed that it was invalid because the chief constable had changed in the interim, and there had been no assignment of the benefit of the order.
Held: The office of chief constable was not a corporation, but an office. Some assignment was required. There was no statutory assignment, but there had been an equitable one. An equitable assignment need take no particular form: ‘All that is needed is a sufficient expression of an intention to assign’. Equity would treat as done that which ought to have been done.

Citations:

Times 24-Dec-2003, [2003] EWHC 3391, [2004] 1 WLR 1425

Statutes:

Insolvency Rules 1986 (1986 No 1925) 6.1

Jurisdiction:

England and Wales

Citing:

CitedAttorney-General for New South Wales v Perpetual Trustee Co Ltd PC 14-Mar-1955
(Australia) The Crown could not recover damages for the loss of the services of a police constable as the result of injuries caused by the negligence of a third person. A chief constable was an office held under the Crown, and the usual relationship . .

Cited by:

Appeal fromCoulter v Chief Constable of Dorset Police CA 8-Oct-2004
The appellant had failed in his action against the police and been ordered to pay the costs. A statutory demand was issued in the name of the respondent, but as the new chief constable had no deed of assignment, he was only equitable assignee.
See AlsoCoulter v Chief Constable of Dorset Police CA 13-Jul-2005
An appeal was made against an order refusing to set aside a second statutory demand. The demand was to enforce payment of an order for costs made in proceedings between the parties. The first statutory demand had been upheld, and the judge found . .
Lists of cited by and citing cases may be incomplete.

Police, Insolvency, Equity

Updated: 12 May 2022; Ref: scu.189946

In re EWA, A Debtor: CA 1901

The general rule is that where an obligation is joint and several, the release of one of two joint debtors has the effect of releasing the other, but: ‘It is clear that, although a document in terms purports to release one of two joint debtors, yet it may contain in terms a reservation of rights against the other joint debtor. Where you find those two provisions you construe the document, not as a release, but merely as an undertaking not to sue a particular individual, and the result is that the right to proceed against the co-debtor is reserved and can be put in force against him. Whenever you can find from the terms of the document an agreement for the reservation of rights against the co-debtor, then, I agree, the document cannot be construed as an accord and satisfaction of the joint debt, and, therefore, as a release of the co-debtor.’

Judges:

Collins LJ

Citations:

[1901] 2 KB 642

Jurisdiction:

England and Wales

Cited by:

CitedMatthews v Pournasrollahzadeh and Another CA 9-Mar-1998
The tenant fell into arrears, and discussed a surrender with the landlord. It had been intended that the landlord would waive any arrears, but he then claimed that there had been an implied surrender by law, and that the arrears remained.
Lists of cited by and citing cases may be incomplete.

Insolvency

Updated: 12 May 2022; Ref: scu.187716

re 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.

Judges:

E.G.Nugee QC

Citations:

1997 BBIR 683

Jurisdiction:

England and Wales

Cited by:

CitedRoberts 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 . .
Lists of cited by and citing cases may be incomplete.

Insolvency

Updated: 12 May 2022; Ref: scu.187054

Re Hart, ex parte Green: 1912

The original disposal by a debtor was prior to the act of bankruptcy, though the later transfer by the disponee to the defendant was after it.
Held: In such a case, the trustee could not succeed against a transferee for value without notice.

Judges:

Warrington LJ

Citations:

[1912] 3 KB 6

Cited by:

DistinguishedRe Gunsbourg CA 1920
The debtor transferred his assets to a company formed by him. He later committed an act of bankruptcy on which he was adjudicated bankrupt. The company had sold some of the assets to a bona fide purchaser without notice of the act of bankruptcy. The . .
CitedAl Sabah and Al Sabah v Grupo Torras SA Culmer as trustee of the property of Sheikh Fahad Mohammed Al Sabah, bankrupt PC 11-Jan-2005
PC (Cayman Islands) The claimant complained of an order of the Court of Appeal of the Cayman Islands, requiring him to comply with a letter of request from the Grand Court of the Bahamas.
Held: In earlier . .
Lists of cited by and citing cases may be incomplete.

Insolvency

Updated: 12 May 2022; Ref: scu.186765

Knight v Lawrence: 1991

If a mortgaged property is let, the receiver is duty bound to inspect the lease and, if the lease contains an upwards only rent review, to trigger that rent review in due time.

Citations:

[1991] BCC 411

Citing:

Appealed toKnight v Lawrence 1993
As part of his duty of care, a receiver may be required to take positive steps to maintain the value of the property. . .

Cited by:

Appeal fromKnight v Lawrence 1993
As part of his duty of care, a receiver may be required to take positive steps to maintain the value of the property. . .
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: 12 May 2022; Ref: scu.187039

Stein v Pope: CA 1902

A lessee assigned the lease by an assignment which constituted an act of bankruptcy. He was subsequently adjudicated bankrupt and his trustee disclaimed the lease. During the interval between the assignment of the lease and the date of the adjudication two quarters’ rent had fallen due, the lessors had sued the assignee and had recovered judgment for the first quarter’s rent, and had commenced proceedings for the second quarter’s rent. The action did not come on for trial until after the adjudication. Was the assignee of the lease liable for the rents notwithstanding the relation back of the trustee’s title?
Held: He was. The bankruptcy provisions, including the relation back of the trustee’s title, were not provisions for the benefit of the bankrupt. As a general rule bankruptcy did not affect the rights and liabilities of persons not parties to the bankruptcy, except so far as might be necessary in the interests of the trustee and creditors and the administration of the bankrupt’s estate in bankruptcy. It was not necessary in those interests to hold that the bankruptcy had freed the assignee from his liability to the lessor. The court reserved its opinion on what would have been the outcome if bankruptcy had supervened before any action had been take by the lessor against the assignee.

Judges:

Romer LJ, Sir Richard Henn Collins MR

Citations:

[1902] 1 KB 595 CA

Jurisdiction:

England and Wales

Citing:

ApprovedTitterton v Cooper CA 1882
The bankrupt was a lessee. His trustee did not disclaim the lease, and the question was whether he was personally liable for the rent which had fallen due between the date of his appointment and the date on which he elected not to disclaim.

Cited by:

CitedRe Dennis (A Bankrupt) CA 22-May-1995
A joint tenancy was severed (under the former law) on the event of an act of bankruptcy, and not only by the later actual adjudication of bankruptcy. The vesting of the debtor’s property in the trustee which occurred on adjudication was automatic; . .
Lists of cited by and citing cases may be incomplete.

Insolvency, Landlord and Tenant

Updated: 12 May 2022; Ref: scu.186760

Re Offshore Ventilation: 1989

The position of agency of receivers is a real one, even though it has some peculiar incidents.

Citations:

[1989] 5 BCC 160

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.

Agency, Insolvency

Updated: 12 May 2022; Ref: scu.187040

Re Gershon and Levy: 1915

An order was made by consent in a partnership action to tax the costs of the parties and the receiver was ordered to pay the costs when taxed out to the solicitors for the parties out of the partnership assets. When the order was made all parties knew that a bankruptcy petition was pending against each of the partners. They were later adjudicated bankrupt on that petition. The solicitors claimed to be secured creditors.
Held: The order created an equitable charge on the partnership assets in favour of the claimants. But for the doctrine of relation back, the solicitors were secured creditors and entitled to priority over other creditors because all necessary parties were before the court when the order was made, but as a result of the relation back of the trustee’s title to the partnership assets, the partners were not the proper parties and could not consent to the order.

Judges:

Horridge J

Citations:

[1915] 2 KB 527

Cited by:

CitedRe Dennis (A Bankrupt) CA 22-May-1995
A joint tenancy was severed (under the former law) on the event of an act of bankruptcy, and not only by the later actual adjudication of bankruptcy. The vesting of the debtor’s property in the trustee which occurred on adjudication was automatic; . .
Lists of cited by and citing cases may be incomplete.

Insolvency

Updated: 12 May 2022; Ref: scu.186763

Borland’s Trustee v Steel Brothers and Co Ltd: 1901

Mr Borland was a shareholder. The company’s articles contained pre-emption rights, such that on a shareholder’s bankruptcy, he had, on receiving a transfer notice from the directors, to transfer his shares to a manager or assistant at a fair value calculated in accordance with the articles. His trustee said that the transfer articles were void because, among other reasons, they amounted to a fraud upon the bankruptcy laws, and could not prevail when bankruptcy had supervened, since the trustee was forced to part with the shares at less than their true value, and the asset was not fully available for creditors.
Held: Farwell J said: ‘a simple stipulation that upon a man’s becoming bankrupt that which was his property up to the date of the bankruptcy should go over to some one else and be taken away from his creditors, is void as being a violation of the policy of the bankrupt law’. It was a commercial arrangement, and the provisions were were a fair agreement for the business of the company. They were binding equally on all shareholders. There was no suggestion of fraudulent preference, and nothing obnoxious to the bankruptcy law in a clause which provided that if a man became bankrupt he should sell his shares. The price was a fixed sum for all persons alike, and no difference in price arose in the case of bankruptcy. The purpose was that there should be in the company, if it were so desired, none but managers and workers in Burma. There was nothing repugnant in the way in which the value of the shares was to be ascertained. It would have been different if there were any provision in the articles compelling persons to sell their shares in the event of bankruptcy at something less than the price that they would have otherwise obtained, since such a provision would be repugnant to the bankruptcy law
He described the nature of a company share: ‘It is the interest of a person in the company, that interest being composed of rights and obligations which are defined by the Companies Act and by the memorandum and articles of association of the company.’ and one with limited liability in a company: ‘A share is the interest of the shareholder in the company measured by a sum of money, for the purpose of liability in the first place, and of interest in the second, but also consisting of a series of mutual covenants entered into by all the shareholders inter se in accordance with section 16 of the Companies Act 1862. The contract contained in the articles of association is one of the original incidents of the share. A share is . . an interest measured by a sum of money and made up of various rights contained in the contract, including the right to a sum of money of a more or less amount.’

Judges:

Farwell J

Citations:

[1901] 1 Ch 279

Cited by:

ApprovedInland Revenue Commissioners v Crossman HL 1937
For a valuation for estate taxes, the value is what a purchaser in the open market would have paid to enjoy whatever rights attached to the property at the relevant date.
Lord Russell of Killowen said that a share is the interest of a . .
CitedHer Majesty’s Commissioners of Inland Revenue v Laird Group plc HL 16-Oct-2003
Was the payment of a dividend in respect of shares ‘a transaction in securities’ or ‘a transaction relating to securities’ within the meaning of section 703.
Held: ‘As a matter of ordinary language, the creation, issue, sale, purchase, . .
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 . .
Lists of cited by and citing cases may be incomplete.

Company, Insolvency

Updated: 12 May 2022; Ref: scu.186959

Ex parte Smith: 1800

Two partners, Strickland and Richardson, held property as joint tenants at law. Richardson committed an act of bankruptcy by absenting himself, and a commission was issued against him. The commissioners then declared Richardson bankrupt and executed a provisional assignment. Meanwhile Strickland, the solvent partner, had died. Richardson’s brother-in-law issued a second commission and Richardson was found a bankrupt under that commission. The petitioners under the first commission then petitioned that the second commission be superseded, ie. stayed. The Attorney General, seeking to uphold the second commission, argued that there having been no assignment before Strickland’s death the survivorship had taken place. He submitted that: ‘The date of the commission has no effect: but the relation to the act of bankruptcy is this: it avoids all acts to the prejudice of creditors; but has not the effect of preventing the bankrupt from acquiring property by survivorship.’ Counsel for the petitioners, arguing for a stay of the second commission, did not refer to the doctrine of relation back, submitting that the partnership was severed in Strickland’s lifetime by the issue of the commission: ‘The commission severs the partnership. When the commission issues, the property is out of the bankrupt and in the commissioners; and the assignees take from the commissioners.’
Held: Rejecting the argument of the petitioners, but it is not clear whether he accepted that of the Attorney General. ‘The issuing of the commission does nothing, unless he is found a bankrupt. The adjudication that he is a bankrupt is what severs the partnership. The first act is that declaring him a bankrupt, then all the property is out of him; and they make the assignment…I am satisfied that the first commission will do well enough. Let the first commission stand.’

Judges:

Lord Loughborough LC

Citations:

(1800) 5 Ves Jun 296

Cited by:

DisapprovedRe Dennis (A Bankrupt) CA 22-May-1995
A joint tenancy was severed (under the former law) on the event of an act of bankruptcy, and not only by the later actual adjudication of bankruptcy. The vesting of the debtor’s property in the trustee which occurred on adjudication was automatic; . .
Lists of cited by and citing cases may be incomplete.

Insolvency

Updated: 12 May 2022; Ref: scu.186747

Bishopsgate Investment Limited v Maxwell: CA 1999

A person required to answer questions under the section may not refuse to answer on the ground of self-incrimination. (Dillon LJ) ‘It is plain to my mind – and not least from the Cork Report – that part of the mischief in the old law before the Insolvency Act 1985 was the apparent inability of the law to deal adequately with dishonesty or malpractice on the part of bankrupts or company directors . . That was a matter of public concern, and there is a public interest in putting it right. As steps to that end, Parliament has, by [the Insolvency Act 1986], greatly extended the investigative powers available to office-holders, with the assistance of the court, and has expressly placed the officers of the company and others listed in section 235(3), under a duty to assist the office-holder’. As to the Bishopsgate and Riley cases: ‘The essence of both decisions is that if Parliament, in the public interest, sets up by statute special investigatory procedures to find out if the affairs of a company have been conducted fraudulently, with the possibility of special remedies in the light of an inspector’s report, or to find out if there have been infringements of certain sections of the Banking Act 1987 which have been enacted for the protection of members of the public who make deposits, Parliament cannot have intended that anyone questioned under those procedures should be entitled to rely on the privilege against self-incrimination, since that would stultify the procedures and prevent them achieving their obvious purpose.’

Judges:

Dillon LJ

Citations:

[1999] Ch 1

Statutes:

Insolvency Act 1986 236

Jurisdiction:

England and Wales

Citing:

CitedBank of England v Riley 1992
Exercise of the right of privilege against self-incrimination. . .
CitedIn Re London United Investments Plc CA 1992
The privilege against self-incrimination was impliedly excluded by the terms of a statute which conferred power on company inspectors appointed by the Secretary of State to require documents and answers to questions from any person whom they . .

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 . .
CitedRegina v Hertfordshire County Council, ex parte Green Environmental Industries Ltd and Another HL 17-Feb-2000
A notice was given to the holder of a waste disposal licence to require certain information to be provided on pain of prosecution. The provision of such information could also then be evidence against the provider of the commission of a criminal . .
Lists of cited by and citing cases may be incomplete.

Insolvency

Updated: 12 May 2022; Ref: scu.186360

In re John Tweddle and Company Ltd: CA 1910

The court discussed the official receiver’s enquiries and report leading up to the public examination of former directors. Farwell LJ said: ‘Now those are functions of a judicial character which are cast upon him, not in the liquidation of the company for the benefit of the assets, but primarily at any rate for the protection of the public. One has to bear in mind that in 1890 there had been various company failures, and it was thought that more drastic legislation was required against directors and promoters and people standing in that position, and I have no doubt that this section was passed for that purpose. It is said, and with some truth, perhaps, that it is a little hard on the company if the view that we take is correct that the costs of all this should come out of the company’s assets; but a company only exists by favour of and on the conditions imposed by the legislature, and it is not immaterial to observe that as long ago as 1862, under the 167th section of the Act of 1862, if directors were prosecuted (as mentioned in that section) the expense of the prosecution came out of the assets of the company’.

Judges:

Farwell LJ

Citations:

[1910] 2 KB 697

Jurisdiction:

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: 12 May 2022; Ref: scu.186359

TSB Bank plc v Platts (No 2 ): 1997

Judges:

His Honour Judge Weeks Q.C

Citations:

[1997] BPIR 302

Jurisdiction:

England and Wales

Cited by:

Appeal fromPlatts v Trustees Savings Bank Plc CA 13-Feb-1998
A counterclaim for negligent sale was a valid claim allowing potential against repossessing bank but would not make bank’s claim unliquidated. The Judge could properly hold that there was a liquidated and unsecured debt the subject of the statutory . .
Lists of cited by and citing cases may be incomplete.

Insolvency

Updated: 12 May 2022; Ref: scu.184791

Re a Company (No 003729 of 1982 ): ChD 1984

A creditor had claimed that the company owed it some andpound;12,000 for work done by the creditor for the company. The company refused to pay that sum but offered to pay some andpound;2,000. Two years later the creditor served a statutory demand for the original sum claimed and, when there was no payment, presented a winding-up petition. The company then paid the sum which it had previously offered to pay. An issue in the proceedings was whether the company had neglected to pay the sum demanded and it was argued by the creditor that the company had neglected to pay a sum exceeding andpound;200, the then statutory minimum, when it did not pay the sum it had previously offered and subsequently paid.
Held: The creditor was not in a position to make a genuine demand for a specified sum. A winding-up order may not be made on a debt which is disputed in good faith by the company.

Judges:

Mervyn Davies J

Citations:

[1984] 1 WLR 1090, [1984] 3 All ER 78

Jurisdiction:

England and Wales

Cited by:

DoubtedPlatts v Trustees Savings Bank Plc CA 13-Feb-1998
A counterclaim for negligent sale was a valid claim allowing potential against repossessing bank but would not make bank’s claim unliquidated. The Judge could properly hold that there was a liquidated and unsecured debt the subject of the statutory . .
Lists of cited by and citing cases may be incomplete.

Insolvency, Company

Updated: 12 May 2022; Ref: scu.184800

Galbraith v Grimshaw and Baxter: CA 1910

A garnishee order nisi does not operate as a transfer of the property in the debt, but it is an equitable charge on it, and the garnishee cannot pay the debt to any one but the garnishor without incurring the risk of having to pay it over again to the creditor.

Judges:

Farwell LJ

Citations:

[1910] 1 KB 339

Jurisdiction:

England and Wales

Cited by:

CitedSociete Eram Shipping Company Limited and others v Hong Kong and Shanghai Banking Corp Ltd, Compagnie Internationale de Navigation HL 12-Jun-2003
The appeal concerned a final third party debt order (formerly a garnishee order). A judgment in France was registered here for enforcement. That jurisdiction was now challenged.
Held: A third party debt order is a proprietary remedy operating . .
Appeal FromGalbraith v Grimshaw and Baxter HL 2-Jan-1910
Where a Scottish sequestration occurred shortly after an English garnishee order nisi, the judgment creditor prevailed over the trustee in bankruptcy, although the result would have been different if both the attachment and the bankruptcy had . .
CitedRubin and Another v Eurofinance Sa and Others SC 24-Oct-2012
The Court was asked ‘whether, and if so, in what circumstances, an order or judgment of a foreign court . . in proceedings to adjust or set aside prior transactions, eg preferences or transactions at an undervalue, will be recognised and enforced in . .
Lists of cited by and citing cases may be incomplete.

Litigation Practice, Insolvency

Updated: 12 May 2022; Ref: scu.183521

Re Button: 1905

A secured petitioner’s estimate of the value of his property was challenged.
Held: The petitioner’s estimate was made ‘at his own risk’, in that, if at undervalue, he would still be bound by it in the bankruptcy; but that, provided the estimate was ‘real and not a sham’, it was not the function of the court ‘to go into the question what is the true value after the declaration of the estimated value.’

Judges:

Vaughan Williams LJ

Citations:

[1905] 1 KB 602

Statutes:

Bankruptcy Act 1883

Cited by:

CitedOwo-Samson v Barclays Bank Plc, Boyden CA 21-May-2003
The appellant challenged a formal statutory demand which had led to his bankruptcy. The demand had included the anticipated cost of realising the charged property, and also had been inflated to allow for extra costs of dealing the appellant who was . .
Lists of cited by and citing cases may be incomplete.

Insolvency

Updated: 12 May 2022; Ref: scu.182734

Sea Voyager Maritime Inc and Others v Bielecki trading as Hughes Hooker and Co: ChD 23 Oct 1998

The creditor alleged a right to recover against the estate citing an unfair prejudice from the IVA.
Held: He had been unfairly prejudiced. The IVA precluded him, like all the other unsecured creditors, from suing the debtor for the full amount of his claim
Where a claim in a debtor’s estate was in respect of a claim which remained unliquidated, and an insolvency arrangement could very substantially prejudice that claim, the creditor was entitled to relief against the proposed arrangement; however, the prejudice to the applicant must be prejudice as a creditor of the debtor and not in some other capacity.

Judges:

Richard McCombe QC

Citations:

Times 23-Oct-1998, [1999] BCC 924, [1999] 1 All ER 4 628

Statutes:

Insolvency Act 1986 262, Third Party (Rights Against Insurers Act) 1930

Jurisdiction:

England and Wales

Cited by:

CitedWright and Another (Liquidators of SHB Realisations Ltd) v The Prudential Assurance Company Ltd ChD 6-Mar-2018
IVA is a special form of contract
Liquidators asked the court whether sums sought by the insolvent company’s landlords were payable and or provable. Under an IVA, the copany had been paying reduced rents, but the arrangement document provided that the full rents would be restored on . .
Lists of cited by and citing cases may be incomplete.

Insolvency

Updated: 11 May 2022; Ref: scu.89073

Secretary of State for Trade and Industry and Another v Arum Marketing Ltd and Another: CA 31 Aug 2000

A company was wound up on public interest grounds. The costs were ordered to be paid out of the company’s assets. The Secretary appealed, and on appeal the costs were ordered to be paid by the company’s sole director and shareholder personally. The company was a swindle, and there was no reason why anyone other than the proprietor should lose out if it was not necessary.

Citations:

Gazette 31-Aug-2000

Jurisdiction:

England and Wales

Company, Costs, Insolvency

Updated: 11 May 2022; Ref: scu.89110

Heritable Reversionary Co v Millar (M’Kay’s Trustee): HL 9 Aug 1892

Held (rev. the judgment of the First Division) that a sequestration does not vest in a trustee in bankruptcy heritage to which the bankrupt holds an unqualified feudal title in his own name, if it can be shown that he only holds it in trust for another.

Judges:

Lords Herschell, Watson, Macnaghten, and Field

Citations:

[1892] UKHL 13, 30 SLR 13

Links:

Bailii

Jurisdiction:

Scotland

Insolvency

Updated: 11 May 2022; Ref: scu.634560

Bottomley v Brougham: 1908

The official receiver is acting in a judicial capacity in making his report and his further report and in conducting the examination under that further report. A judge is privileged from inquiry as to whether he is malicious. Channell J considered whether the OR in carrying out investigative functions came within the doctrine of absolute privilege. He held: ‘I think, in the first place, that the official receiver has a statutory duty to inquire in a judicial way into certain matters by the Act of 1890, and that in performing that duty he is acting in a judicial capacity. It is quite true that the report is made ex parte, but that makes no difference. A judge in hearing an ex parte application is still acting as a judge, and the absolute privilege applies quite as much as when he is hearing a case in which both parties appear. The fact that this was a preliminary inquiry equally does not prevent it being a judicial enquiry. An inquiry before a magistrate on a charge of murder, for instance, which he has certainly no power to deal with, and as to which he is only inquiring in a preliminary way whether there is a case for committing the accused person for trial, is clearly a judicial proceeding although it is preliminary to trial. It is strongly contended on the part of the plaintiff that there is mischief and danger in allowing absolute privilege in this case, because it is an ex parte statement, and the person against whom the charge is made has no opportunity of meeting it; it appears to me, however, that the answer to that is the very fact that it is preliminary, and that it does lead to further inquiry upon which that person does have that opportunity of explaining and giving his view of the matter, and that, it being obviously known by anybody who sees or reads the report of the official receiver that, qua report, it will lead to future proceedings in which the report may be entirely displaced, that really prevents any serious mischief arising from applying this doctrine to such a proceeding as this. I think, therefore, that this report may be considered to be absolutely privileged on the footing of its being the judgment of a judicial officer upon a matter entrusted to him for inquiry’.
However Channell J went on to give an alternative ground for holding that the OR attracted absolute privilege which proceeded on the arguably opposite premise that the function which the OR was exercising was more analogous to that of a prosecutor than a judge: ‘But, even if that is not sound, there is the further ground that the report of the official receiver may be treated, not so much as the judgment in a judicial proceeding, but as the initial stage of proceedings in the winding-up Court, which clearly is a Court. It is the information upon which the proceedings take place and it is made by the official receiver under a statutory duty. It seems to me to come within the authority of the case of Lilley v Roney 61 L.J. (Q.B.) 727, and to be a much stronger case, because in that case complaint by a person who considered himself aggrieved by the conduct of a solicitor – a complaint which was the initiation of proceedings before the Law Society – was held to be privileged as being the commencement of proceedings of a legal character. I quite agree that there the privilege was rather the privilege of a litigant than the privilege of the judge; it was the privilege of a man who was starting proceedings. It is perhaps not quite accurate to say the official receiver is in any sense a litigant, but when he comes before the winding-up Court upon the examination no doubt he is, in one sense, a party to the proceedings; he is, as it were, appearing for the prosecution. It is much the same as when the Attorney-General appears upon an information filed by the Attorney-General; he is then a party to the proceedings possibly, not a litigant, and I should say certainly not acting as a judge, but I do not see that that much affects the matter here. In presenting this report the official receiver is informing the Court of alleged matters for inquiry, and so initiating a judicial enquiry; and it seems to me to be entirely analogous to what was held to be absolute privilege in Lilley v Roney, and to be a stronger case. It was done in the course of the performance of a duty imposed upon him in his position of officer of the Court. It is much like the report of an official referee, or someone of that sort, to whom matters are referred to report to the Court. I suppose no one would doubt that those reports were privileged.’

Judges:

Channell J

Citations:

[1908] 1 KB 584

Cited by:

CitedMore v Weaver CA 11-Jul-1928
The appellant brought the latest of several actions, this time alleging defamation in letters from the respondent to her own solicitors making certain statements about the appellant. Those letters had become public in the course of the earlier . .
Lists of cited by and citing cases may be incomplete.

Legal Professions, Insolvency, Defamation

Updated: 11 May 2022; Ref: scu.552688

In re Trent and Humber Shipbuilding Co; Bailey and Leetham’s Case: 1869

The court was asked whether costs awarded against a company were costs in the winding up.
Held: Where a creditor has obtained leave of the court to bring proceedings against a company in liquidation, any costs to which the creditor would become entitled as a result of the successful prosecution of the proceedings would be payable out of the company’s assets in full.
The rationale for the estate costs rule lies in the fact that: ‘a company in winding up ought to be dealt with as a matter of course like any other litigant, and if an action be brought or resisted for the benefit of the estate, and that action be brought fruitlessly, or defended fruitlessly, then the estate, that is to say, the other creditors, ought, like everybody else, to be fixed with the costs to which they have improperly and unnecessarily put their opponent.’

Citations:

(1869) LR 8 Eq 94

Cited by:

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 . .
Lists of cited by and citing cases may be incomplete.

Insolvency, Company

Updated: 11 May 2022; Ref: scu.537946

In Re European Life Assurance Society: 1869

Sir William James V-C dismissed a petition for the winding up of a company which had issued large numbers of life policies and annuity contracts, and appeared to be in financial difficulties. He rejected the basis of the ‘just and equitable’ ground in section 79(5) of the 1862 Act, saying: ‘And in my view of the law of the case it would be just and equitable to wind up a company like this assurance company if it were made out to my satisfaction that it is, not in any technical sense but, plainly and commercially insolvent – that is to say, that its assets are such, and its existing liabilities are such, as to make it reasonably certain – as to make the court feel satisfied – that the existing and probable assets would be insufficient to meet the existing liabilities. I take it that the court has nothing whatever to do with any question of future liabilities, that it has nothing whatever to do with the question of the probability whether any business which the company may carry on tomorrow or hereafter will be profitable or unprofitable. That is a matter for those who may choose to be the customers of the company and for the shareholder to consider.’

Judges:

Sir William James V-C

Citations:

(1869) LR 9 Eq 122

Statutes:

Companies Act 1862 79(5)

Jurisdiction:

England and Wales

Cited by:

CitedByblos Bank SAL v Al-Khudhairy CA 1987
The parties disputed the validity of the appointment of a receiver. The ostensible ground for appointment of the receiver was not made out, but the bank relied on a new ground, section 223(d) of the 1948 Act. Nicholls LJ observed: ‘Construing this . .
CitedBNY Corporate Trustee Services Ltd and Others v Neuberger SC 9-May-2013
Potential Insolvency effect under guarantee
The various parties had entered into complex and substantial financial arrangements incorporating guarantees. The guarantees were conditional upon the guaranteed party being solvent. The parties disputed whether a party which would otherwise be . .
Lists of cited by and citing cases may be incomplete.

Insolvency, Company

Updated: 11 May 2022; Ref: scu.535115

In re a Company (Bond Jewellers): ChD 21 Dec 1983

A tenant company had a propensity for postponing payment of its debts until threatened with litigation. Nourse J felt unable to make an order under section 223(d), and considered, but ultimately did not make an order, on the ‘just and equitable’ ground in section 222(f). The phrase ‘as they fall due’, although not part of the statutory text, was understood to be implicit in section 223(d). Nourse J observation as to section 223(d): ‘Counsel says that if I take into account the contingent and prospective liabilities of the company, it is clearly insolvent in balance sheet terms. So indeed it is if I treat the loans made by the associated companies as loans which are currently repayable. However, what I am required to do is to ‘take into account’ the contingent and prospective liabilities. That cannot mean that I must simply add them up and strike a balance against assets. In regard to prospective liabilities I must principally consider whether, and if so when, they are likely to become present liabilities.’

Judges:

Nourse J

Citations:

[1986] BCLC 261

Statutes:

Companies Act 1948 223(d) 222(f0

Jurisdiction:

England and Wales

Cited by:

CitedByblos Bank SAL v Al-Khudhairy CA 1987
The parties disputed the validity of the appointment of a receiver. The ostensible ground for appointment of the receiver was not made out, but the bank relied on a new ground, section 223(d) of the 1948 Act. Nicholls LJ observed: ‘Construing this . .
CitedBNY Corporate Trustee Services Ltd and Others v Neuberger SC 9-May-2013
Potential Insolvency effect under guarantee
The various parties had entered into complex and substantial financial arrangements incorporating guarantees. The guarantees were conditional upon the guaranteed party being solvent. The parties disputed whether a party which would otherwise be . .
Lists of cited by and citing cases may be incomplete.

Company, Insolvency

Updated: 11 May 2022; Ref: scu.535117

Re Miller: CA 1901

A prospective partner in the firm paid andpound;2,000 to a broker on terms that he should have the option of demanding its repayment if he did not become a partner by a date. The firm was hammered before that date and having given notice to determine the agreement, he then petitioned for bankruptcy in that sum.
Held: The alleged debt of andpound;2,000 was not a liquidated sum and could not therefore found a petition because the hammering of the firm was not an event which entitled notice of determination to be served under the agreement. The only remedy for the firm’s inability to perform the contract was one in damages which was not a debt in a liquidated sum.

Citations:

(1901) 1 QB 51

Cited by:

CitedMcGuinness v Norwich and Peterborough Building Society CA 9-Nov-2011
The appellant had guaranteed his brother’s loan from the respondent, and the guarantee having been called in and unpaid, he had been made bankrupt. He now appealed saying that the guarantee debt, even though of a fixed amount could not form the . .
Lists of cited by and citing cases may be incomplete.

Insolvency

Updated: 11 May 2022; Ref: scu.450461

Barclays Bank Ltd v TOSG Trust Fund Ltd: CA 1984

Oliver LJ acceded to a submission that the rule better be called the rule against double dividends, for its object was to absolve the liquidator from paying out two dividends on what was essentially the same debt. Because overlapping liabilities resulted from separate and independent contracts with the debtor, the basis of the liability by itself was not determinative of whether the rule applied. Oliver LJ said: ‘The test is in my judgment a much broader one which transcends a close jurisprudential analysis of the persons by and to whom the duties are owed. It is simply whether the two competing claims are, in substance, claims for payment of the same debt twice over . . for the moment I accept [the] broad general proposition that the rule against double proofs in respect of two liabilities of an insolvent debtor is going to apply wherever the existence of one liability is dependant upon and referable only to the liability to the other and where to allow both liabilities to rank independently for dividend would produce injustice to the other unsecured creditors.’
Slade LJ said that the payment of more than one dividend in respect of what was in substance the same debt would give the relevant proving creditors a share of the available assets larger than the share properly attributable to the debt in question.

Judges:

Oliver LJ, Slade LJ

Citations:

[1984] AC 626, [1984] 1 All ER 628, [1984] BCLC 1, [1984] 2 WLR 49

Jurisdiction:

England and Wales

Cited by:

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 . .
Lists of cited by and citing cases may be incomplete.

Insolvency, Equity

Updated: 11 May 2022; Ref: scu.449847

In re Detmold, Detmold v Detmold: 1889

A provision stated that the property in a marriage settlement (originating from the husband) should pass to the wife for life in the event of an alienation by, or the bankruptcy of, the husband.
Held: It was valid against the husband’s trustee in bankruptcy, on the ground that it had been triggered, prior to the commencement of the bankruptcy, by the alienation effected as the result of the appointment of a receiver of the property in the settlement.

Citations:

(1889) 40 Ch D 585

Cited by:

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 . .
Lists of cited by and citing cases may be incomplete.

Insolvency, Contract

Updated: 11 May 2022; Ref: scu.442615

In Re Cabletel Installations Ltd: 1 Jul 2004

The court criticised the remuneration claimed by the insolvency office-holder were work had been carried out at too senior a level, and the calculation was an uncritical application of the time spent, and where there were more and lengthier meetings and excessive reviews than the administration warranted. Chief Registrar Baister set out the approach he would adopt to fixing the applicant administrators’ remuneration: ‘I shall examine the main work streams and some of their subcategories and consider the time spent and whether it was justified; I shall have regard, insofar as I can, to the level at which work has been done; I shall consider the benefit of the work done and, to any extent appropriate, whether it was necessary. I shall then look at the larger picture and consider the case in terms of value. In doing so I shall have regard to the factors set out in the rules and to other factors peculiar to this case. I shall bear in mind that time spent is a measure not of the value of the service rendered but of the cost of rendering it. I do not propose, therefore, to allow myself to be influenced to any real extent by the final figures which the administrators claim, since, it seems to me that, prima facie, they reflect the cost of time rather than the value of the service provided. I shall resolve any doubts I have against the administrators.’

Judges:

Chief Registrar Baister

Citations:

[2005] BPIR 28

Citing:

CitedIn Re Independent Insurance Co Ltd (No 2) 2003
Ferris J was required to consider the insolvency office-holders’ remuneration, assisted by a solicitor with wide insolvency experience, whose report sets out the general principles then accepted by the insolvency profession as the yardstick for . .
CitedMirror Group Newspapers Plc v Maxwell and Others (No 2) ChD 15-Jul-1997
The Court reminded insolvency practitioners of fiduciary duties to creditors when refusing application for further payment on account of costs. Ferris J considered the principles applicable to fixing the remuneration of receivers of the estate of . .

Cited by:

CitedBrook v Reed CA 25-Mar-2011
The court was asked ‘What relation should the costs and remuneration bear to the circumstances, and in particular the size, of the bankruptcy?’ The bankrupt had considered that the costs first awarded to the trustee in bankruptcy and the trustee’s . .
Lists of cited by and citing cases may be incomplete.

Insolvency, Costs

Updated: 11 May 2022; Ref: scu.430875

In Re Carton Ltd: 1923

The court considered the remuneration of a liquidator in a voluntary liquidation.
Held: The court refused to authorise remuneration at an unusually generous percentage rate, which had been approved by the committee of inspection, on the grounds that the amount of work undertaken did not justify a rate higher than the rate usually applied. PO Lawrence J also said this of a time-basis: ‘The Court as a general rule only fixes remuneration on a time-basis if there is no other method which would operate to give the liquidator fair remuneration. Experience has shown that the time occupied by a liquidator and his clerks affords a most unreliable test by which to measure the remuneration. Even the best accountant may spend hours over unproductive work, let alone his more or less efficient staff of clerks . . The Court has long since come to the conclusion that the proper method to adopt whenever it is practicable is to assess the remuneration according to the results attained,’

Judges:

PO Lawrence J

Citations:

(1923) 39 TLR 194

Cited by:

CitedBrook v Reed CA 25-Mar-2011
The court was asked ‘What relation should the costs and remuneration bear to the circumstances, and in particular the size, of the bankruptcy?’ The bankrupt had considered that the costs first awarded to the trustee in bankruptcy and the trustee’s . .
Lists of cited by and citing cases may be incomplete.

Insolvency, Costs

Updated: 11 May 2022; Ref: scu.430874

In Re Rhodesia Goldfields Ltd: ChD 1910

Partridge, a director of the company who held some of its debenture stock, was facing a serious misfeasance claim which had not yet been resolved. Set-off was therefore not available.
Held: Payment of what was due to Partridge and his assignees was therefore deferred until the claim against him was resolved.
Swinfen Eady J said: ‘it would be a strange travesty of equity to hold that in distributing the fund Partridge was entitled to be paid at once all that was due to him out of the company’s money, and subsequently to find, after it had been established that he owed money to the fund, that the amount could not be recovered from him.’
He went on to discuss the rule in Cerry v Boultbee, saying: ‘The rule is of general application that where an estate is being administered by the Court, or where a fund is being distributed, a party cannot take anything out of the fund until he has made good what he owes to the fund . . a person entitled to participate in and bound to contribute to the same fund cannot receive the benefit without discharging the obligation.’

Judges:

Swinfen Eady J

Citations:

[1910] 1 Ch 239

Jurisdiction:

England and Wales

Citing:

AppliedCherry 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 . .

Cited by:

CitedBrazzill and Others v Willoughby and Others CA 27-May-2010
The regulated bank Kaupthing Singer and Friedlander Ltd (KSF) was in financial difficulties. The Bank of England required KSF to credit to a trust account all future deposits. KSF later went into insolvency. Some deposits had been credited to the . .
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 . .
Lists of cited by and citing cases may be incomplete.

Trusts, Insolvency

Updated: 11 May 2022; Ref: scu.416575

Re A Debtor (No.488 IO of 1996), JP v A Debtor: ChD 1999

The debtor had been ordered to pay his wife a sum by way of ancillary relief in matrimonial proceedings. He then proposed an IVA, which was approved at a creditors meeting. W had notice but did not attend. She along with all other creditors was to receive a part payment in full and final settlement. She applied to revoke the approval.
Held: She succeeded. She wife had a right not enjoyed by other creditors namely the freedom to assert her claim following the husband’s bankruptcy notwithstanding the husband’s discharge which right would be overreached if she was compelled to accept a dividend under the IVA in full and final settlement of her entitlement. She had been unfairly prejudiced to the extent that her special position had not been recognised.

Judges:

Sir John Vinelott

Citations:

[1999] 2 BCLC 571

Statutes:

Insolvency Act 1986 262

Jurisdiction:

England and Wales

Cited by:

AppliedChild Maintenance and Enforcement Commission v Beesley and Another ChD 11-Mar-2010
The agency challenged the inclusion in an individual voluntary arrangement of the father’s arrears of child support. The creditors meeting had approved a full and final settlement. 94% of the debts were arrears of child support. The Commission said . .
Lists of cited by and citing cases may be incomplete.

Insolvency, Family

Updated: 11 May 2022; Ref: scu.402616

Stonegate Securities Ltd v Gregory: CA 1980

The practice of the Companies Court is to dismiss a creditor’s petition based on a debt which is disputed by the company in good faith and on substantial grounds. Buckley LJ said: ‘If the Company in good faith and on substantial grounds disputes any liability in respect of the alleged debt, the petition will be dismissed, or if the matter is brought before a court before the petition is issued, its presentation will in normal circumstances be restrained. That is because a winding up petition is not a legitimate means of seeking to enforce payment of a debt which is bona fide disputed.’

Judges:

Buckley LJ

Citations:

[1980] Ch 576

Cited by:

CitedIn Re Selectmove Ltd CA 21-Dec-1993
Promisse to Pay Tax due is not Consideration
The company appealed against an order for its winding up, saying that the debt was disputed, an accomodation having been reached with the Revenue.
Held: The court declined to regard a promise to the Revenue by a company to pay its existing . .
Lists of cited by and citing cases may be incomplete.

Company, Insolvency

Updated: 11 May 2022; Ref: scu.396765

Surtees And Another, Assignees Of The Estate And Effects Of A Bankrupt, v Ellison: 6 Jul 1829

Evidence of a trading which ceased before the 6 G. 4, c. 16, took effect, will not support a commission of bankrupt issued after that time.

Citations:

[1829] EngR 594, (1829) 9 B and C 750, (1829) 109 ER 278

Links:

Commonlii

Cited by:

CitedEnglish Bridge Union Ltd, Regina (on The Application of) v The English Sports Council and Others Admn 15-Oct-2015
The claimant Union claimed that the defendant should recognise the game of bridge as a sport. The defendant had adopted a definition from Europe which required physical activity, and the Union said that this was a misconstruction of its Royal . .
Lists of cited by and citing cases may be incomplete.

Insolvency

Updated: 11 May 2022; Ref: scu.322462

Regina v Lord Chancellor, ex parte Lightfoot: CA 18 Aug 1999

A debtor does not have a right, under the constitution to participate in any scheme for the relief of debt. Accordingly it was not ultra vires for the Lord Chancellor to provide no discretion on the payment of court fees by an intending applicant for bankruptcy. Such fees were used toward the administration of the applicant’s affairs.

Citations:

Times 18-Aug-1999, Gazette 11-Aug-1999

Statutes:

Insolvency Fees Order 1986 (1986 No 2030) 8(1) 9(b)

Jurisdiction:

England and Wales

Insolvency, Constitutional

Updated: 11 May 2022; Ref: scu.85375

Official Receiver v Environment Agency: CA 5 Aug 1999

A waste management licence could constitute both property and onerous property for the purposes of the Insolvency Act. It could also be an interest incidental to the land to which it related. Because of this the liquidator of a waste management company could disclaim the licence without committing an offence under the Act.

Citations:

Times 05-Aug-1999

Statutes:

Environmental Protection Act 1990 33 34, Insolvency Act 1986 178(3), 436

Jurisdiction:

England and Wales

Environment, Insolvency

Updated: 11 May 2022; Ref: scu.84428

Ord v Upton: CA 7 Jan 2000

A bankrupt labourer (aged 30) after the bankruptcy order issued a writ against a doctor who had treated him for back pain before the bankruptcy order, claiming damages for negligence, including damages for pain and suffering as well as damages for loss of earnings.
Held: An action for damages for personal injuries arising from negligence, brought by a bankrupt was a hybrid claim. It involved claims which were both of a personal and a proprietorial nature, and as such the claim vested in the trustee in bankruptcy. Any part of it could only remain with the bankrupt if it fell within an established exemption. Damages relating to any personal cause of action would be held by the trustee in trust for the bankrupt.
Aldous LJ said: ‘The authorities are only consistent with the conclusion that the trustee is entitled to the damages for past and future loss of earnings and is not entitled to the damages for pain and suffering. As there is a single cause of action, it vested in the trustee. There is in my view nothing in that conclusion which imposes practical difficulties with which the law cannot deal. The trustee as constructive trustee would have to account to the bankrupt for the property which he obtained inadvertently or by arrangement in an action which vested in him for the benefit of the creditors. The idea that the cause of action should vest in the bankrupt would not be acceptable and compulsory joinder of both could lead to difficulties when the claim for loss of earnings was small compared with the potential costs of the litigation. In such a case the trustee, if the cause of action vested in him, would have to consider carefully his duty to the bankrupt and would probably, if requested, assign the cause of action to him’.

Judges:

Aldous LJ, Kennedy and Mantell LJJ

Citations:

Times 11-Jan-2000, Gazette 07-Jan-2000, [2000] Ch 352, [2000] 1 All ER 193, [2000] 2 WLR 755

Statutes:

Insolvency Act 1986 306

Jurisdiction:

England and Wales

Cited by:

CitedMulkerrins v Pricewaterhouse Coopers HL 31-Jul-2003
The claimant sought damages from her former accountants for failing to protect her from bankruptcy. The receiver had unnecessarily caused great difficulties in making their claim that such an action vested in them. The defendants had subsequently, . .
CitedKhan v Trident Safeguards Ltd and others CA 19-May-2004
The claimant had ben made bankrupt. The defendant argued that his claim vested in the trustee.
Held: A discrimination claim was hybrid in nature rather than purely personal, and so it vested in the trustee. However the real issue was the . .
CitedSimpson v Norfolk and Norwich University Hospital NHS Trust CA 12-Oct-2011
The court was asked whether it was possible to assign as a chose in action a cause of action in tort for damages for personal injury, and if so under what circumstances it was possible.
Held: The appeal was dismissed. The claimant did not have . .
Lists of cited by and citing cases may be incomplete.

Personal Injury, Insolvency

Updated: 11 May 2022; Ref: scu.84474

Mulkerrins v Pricewaterhousecoopers (A Firm): CA 12 Jan 2001

A trustee in bankruptcy had had vested in him the legal title to an action for damages for the loss to personal reputation and status of the bankrupt.
Held: A declaration that he had no interest in a claim for damages against a former insolvency practitioner, was not a judgment in rem, making him a bare trustee of that claim. The bankrupt must therefore first secure an assignment of the claim from the trustee in order to bring the action. The declaration did not create a world which was binding upon the defendants.

Citations:

Times 12-Jan-2001, Gazette 01-Feb-2001

Statutes:

Insolvency Act 1986 303

Jurisdiction:

England and Wales

Citing:

Appeal fromMulkerrins v Pricewaterhousecoopers (A Firm) ChD 29-Mar-2000
Where a bankrupt wished to pursue an action held for him personally rather than his creditors.
Held: The trustee in bankruptcy held the right of action in trust for the bankrupt, but declined to sue. The bankrupt had the right to join the . .

Cited by:

Appeal toMulkerrins v Pricewaterhousecoopers (A Firm) ChD 29-Mar-2000
Where a bankrupt wished to pursue an action held for him personally rather than his creditors.
Held: The trustee in bankruptcy held the right of action in trust for the bankrupt, but declined to sue. The bankrupt had the right to join the . .
Appeal fromMulkerrins v Pricewaterhouse Coopers HL 31-Jul-2003
The claimant sought damages from her former accountants for failing to protect her from bankruptcy. The receiver had unnecessarily caused great difficulties in making their claim that such an action vested in them. The defendants had subsequently, . .
Lists of cited by and citing cases may be incomplete.

Professional Negligence, Insolvency

Updated: 11 May 2022; Ref: scu.84114

Masters and Others v Leaver: CA 2 Sep 1999

A judgment obtained by default against a bankrupt in a foreign jurisdiction, was not sufficient evidence of itself, to establish that the debt which it proved had been obtained or created by fraud, or by a fraud to which they were a party. The party had been debarred from defending himself, and a finding on those terms could not mean that the debt should survive a bankruptcy here.

Citations:

Gazette 02-Sep-1999, Times 05-Aug-1999

Statutes:

Insolvency Act 1986 281 (3)

Jurisdiction:

England and Wales

Insolvency, International

Updated: 10 May 2022; Ref: scu.83466

London and Global Ltd v Sahara Petroleum Ltd: CA 3 Dec 1998

A company asserting that it had a defence to a debt upon which an application for winding up was founded, could not succeed simply by filing an affidavit saying it would defend. The court should assess prospects in same was as it would on an application for summary judgment.

Citations:

Times 03-Dec-1998

Jurisdiction:

England and Wales

Insolvency

Updated: 10 May 2022; Ref: scu.83155

In Re Toshoko Finance Uk Plc: CA 29 Mar 2000

Where a company in liquidation made profits which were to be taken into account for Corporation Tax even though they might never be realisable, the tax payable had priority over the claims of the creditors. In this case the prime asset of the company was a debt due from a connected company. It would not be paid, but the law deemed it to receive interest and that the interest was taxable.

Citations:

Times 29-Mar-2000, Gazette 14-Apr-2000

Statutes:

Income and Corporation Taxes Act 1988

Jurisdiction:

England and Wales

Corporation Tax, Insolvency, Company

Updated: 10 May 2022; Ref: scu.82253

In Re Lee (A Bankrupt): CA 22 Aug 1999

The court has sufficient discretion to order that the surplus proceeds of sale of a leasehold interest could be paid to the liquidator despite his having himself disclaimed any interest in the lease. Nobody else had claimed an interest, and the creditors should receive the benefit. This was sensible despite the apparent termination of the liquidator in the lease.

Citations:

Times 22-Aug-1999

Statutes:

Insolvency Act 1986 320 315(3)

Jurisdiction:

England and Wales

Citing:

Appeal fromIn Re Lee (A Bankrupt) ChD 24-Feb-1998
An order vesting a lease disclaimed by the trustee in bankruptcy, in a mortgagee, may provide that any profit which is made on a re-sale of the lease was to be paid on to the receiver for the benefit of creditors. . .

Cited by:

Appealed toIn Re Lee (A Bankrupt) ChD 24-Feb-1998
An order vesting a lease disclaimed by the trustee in bankruptcy, in a mortgagee, may provide that any profit which is made on a re-sale of the lease was to be paid on to the receiver for the benefit of creditors. . .
Lists of cited by and citing cases may be incomplete.

Insolvency

Updated: 10 May 2022; Ref: scu.82003

In Re FJL Realisations Ltd: CA 2 Aug 2000

Administrators took on new employees during the period of administration, but when it came to an end, they were unable to pay the PAYE and NIC for the employees.
Held: The statute gave special priority to debts incurred under new contracts. The liability for PAYE fell under that category, and so did liability for NIC, and these took precedence over the expenses of administration. The tax was a statutory translation of the administrator’s debt to the employee of the amounts deducted from his salary. Secondary NI contributions did not carry the same special priority.

Citations:

Times 02-Aug-2000, Gazette 03-Aug-2000

Statutes:

Insolvency Act 1986 19(4) 19(5) 19(6)

Jurisdiction:

England and Wales

Citing:

Appeal fromIn Re FJL Realisations Ltd ChD 2-Mar-2000
Administrators took on new employees during the period of administration, but when it came to an end, they were unable to pay the PAYE and NIC for the employees.
Held: The statute gave special priority to debts incurred under new contracts. . .

Cited by:

Appealed toIn Re FJL Realisations Ltd ChD 2-Mar-2000
Administrators took on new employees during the period of administration, but when it came to an end, they were unable to pay the PAYE and NIC for the employees.
Held: The statute gave special priority to debts incurred under new contracts. . .
Lists of cited by and citing cases may be incomplete.

Insolvency

Updated: 10 May 2022; Ref: scu.81888

Hunt v Peasegood: CA 20 Oct 2000

Where permission to appeal had been granted, an application to set aside that permission had to be considered only where there existed compelling reason for that reconsideration. The issues for the grant were the overriding objective of litigation and whether an appeal offered a real prospect of success. If that existed, permission was to be granted. If not then it should be refused. The cases of Iran Nabuvat [1990] 1 WLR and Smith v Cosworth Casting Processes Ltd ([1997] 4 All ER 840) remained applicable.

Citations:

Times 20-Oct-2000

Jurisdiction:

England and Wales

Litigation Practice, Insolvency

Updated: 10 May 2022; Ref: scu.81531

In Re A Debtor (No 101 of 1999): ChD 27 Jul 2000

When asked to find that a voluntary arrangement was unfair to a particular creditor, the court was not limited to looking at how much the creditor might receive in bankruptcy proceedings, but could look more widely at what the other effects might be of not recognising the arrangement. Those consequences might include possibilities other than bankruptcy, including litigation over the debts.

Citations:

Times 27-Jul-2000, Gazette 27-Jul-2000

Jurisdiction:

England and Wales

Insolvency

Updated: 10 May 2022; Ref: scu.81650

AIB Finance Ltd v Debtors (Alsop and Another): CA 11 Mar 1998

The duty of care of a lender to get the best price for repossessed properties, was not broken when the business closed before repossession, and the property was not sold as a going concern.

Citations:

Times 11-Mar-1998, Gazette 08-Apr-1998

Jurisdiction:

England and Wales

Citing:

Appeal fromAIB Finance Ltd v Debtors ChD 10-Apr-1997
A Statutory Demand is only finally decided after the failure of a set aside application. . .
Lists of cited by and citing cases may be incomplete.

Banking, Insolvency

Updated: 10 May 2022; Ref: scu.77681

ANC Ltd v Clark Goldring and Page Ltd and Another: CA 31 May 2000

The assignment of the fruits of an action for damages was a sale of property within section 436 of the Act, it was not within the exemption for champerty provided by the Act to a liquidator which arose from the statutory power of sale. The assignment of a cause of action assigned the right to pursue an action, but an assignment of the fruits of an action took place only in equity, and the assignee acquired no interest in the action itself.

Citations:

Times 31-May-2000

Statutes:

Insolvency Act 1986 436

Jurisdiction:

England and Wales

Contract, Insolvency

Updated: 10 May 2022; Ref: scu.77783

Feetum v Levy: CA 2006

Jonathan Parker LJ discussed the granting of declarations: ‘things have indeed moved on since the Meadows case was decided; and the courts should not nowadays apply such a restrictive meaning to the passage in Lord Diplock’s speech in Gouriet’s case’.

Judges:

Jonathan Parker LJ

Citations:

[2006] Ch 585

Jurisdiction:

England and Wales

Citing:

CitedMeadows Indemnity Co Ltd v The Insurance Corporation of Ireland plc and Another CA 1989
A claim was made for declaratory relief.
Held: The Claimant, a re-insurer, did not have locus to claim a declaration that the main insurer could avoid the main contract of insurance, to which the Claimant was not a party. The court considered . .
Appeal fromFeetum and Other v Levy and Others ChD 5-Jan-2005
The applicants sought a declaration that the appointment of the defendants as administrative receivers of the company, a limited liability company, was precluded by the 1986 Act.
Held: The administrator had been appointed under a debenture, . .
CitedGouriet v Union of Post Office Workers HL 26-Jul-1977
The claimant sought an injunction to prevent the respondent Trades Union calling on its members to boycott mail to South Africa. The respondents challenged the ability of the court to make such an order.
Held: The wide wording of the statute . .

Cited by:

CitedOffice of Fair Trading v Foxtons Ltd ChD 17-Jul-2008
Complaint was made that the Foxtons standard terms of acting in residential lettings were unfair. Foxtons objected to the jurisdiction of the Claimant to intervene.
Held: On a challenge to an individual contract, the court would be able to see . .
CitedRolls-Royce plc v Unite the Union CA 14-May-2009
The parties disputed whether the inclusion of length of service within a selection matrix for redundancy purposes would amount to unlawful age discrimination. The court was asked whether it was correct to make a declaratory judgment when the case . .
Lists of cited by and citing cases may be incomplete.

Insolvency, Company

Updated: 10 May 2022; Ref: scu.271001

Heather and Son v Webb: 1876

It was said that, after the discharge of the debtor from his bankruptcy, he had uttered a fresh promise to pay the debt. The court considered the proper construction of section 49 of the 1869 Act. Earlier statutes had made express provision making subsequent promises to pay of no avail to the creditor. That section was not in the same terms, but released the debtor from any ‘proceedings in respect of any debt from which he is released’.
Held: Lord Coleridge CJ said: ‘The plaintiffs’ counsel was driven to say that this was not only not an action brought for the old debt, but not a proceeding in respect of the old debt . . It is in vain to say that this is not a proceeding in respect of a debt provable under the liquidation, and which was discharged by the order of discharge.’

Judges:

Lord Coleridge CJ

Citations:

(1876) 2 CPD 1

Statutes:

Bankruptcy Act 1869 49

Cited by:

CitedLaw Society of England and Wales and others v Shah and others ChD 30-Nov-2007
Solicitor firms had been made bankrupt leaving a shortfall after thefts from client accounts of over 12 million pounds. The thief had diappeared, and the other partners were now discharged form bankruptcy. The Law Society accepted that it could not . .
Lists of cited by and citing cases may be incomplete.

Insolvency

Updated: 10 May 2022; Ref: scu.262981

Trustee Solutions Ltd and others v Dubery and Another: CA 26 Jul 2007

When apportioning the assets of a pension fund on its winding up under the statutory scheme, the trustees had to take careful note of the differing historic retirement ages throught the scheme and between men and women.

Citations:

Times 17-Aug-2007

Statutes:

Pensions Act 1995

Jurisdiction:

England and Wales

Citing:

Appeal fromTrustee Solutions Ltd and others v Dubery and Another ChD 21-Jun-2006
The rules of a pensions scheme were altered. It was required that any such alteration be in writing, but the trustees had not signed the document creating the amendment.
Held: The words ‘writing under hand’ clearly required a signature, and . .
Lists of cited by and citing cases may be incomplete.

Insolvency

Updated: 10 May 2022; Ref: scu.259287

Skjevesland v Geveran Trading Company Limited: ChD 2002

The registrar had decided that the debtor’s centre of main interests was situated in Switzerland.
Held: Article 3 of Regulation (EC) 1346/2000 did not displace the bankruptcy jurisdiction which (as the registrar found) the High Court would otherwise have under section 265 of the Insolvency Act 1986.

Judges:

Judge Howarth

Citations:

[2002] EWHC 2898 (Ch)

Cited by:

CitedIn re Daisytek-ISA Ltd and others 2004
The court was asked where the centre of main interests of French and German subsidiaries of ISA International plc was situated for the purposes of article 3.1 of the Regulation.
Held: After referring to recital (13) to the Regulation, to the . .
Appeal fromSkjevesland v Geveran Trading Co Ltd CA 30-Oct-2002
The debtor’s wife was personally acquainted with counsel for the petitioner in his bankruptcy examination. He sought that it be set aside.
Held: Whereas a judge had a duty to be independent of the parties, no such duty fell on counsel. A court . .
CitedShierson v Vlieland-Boddy CA 27-Jul-2005
The debtor claimed that he could not be served with an insolvency petition, being resident in Spain.
Held: The court was to look to where was the centre of his main interests to determine whether to open insolvency proceedings. On that basis, . .
Lists of cited by and citing cases may be incomplete.

Insolvency

Updated: 10 May 2022; Ref: scu.249852

In re UCT (UK) Ltd: ChD 2001

Arden J was asked to approve aproposal that the company should go into voluntary liquidation, on the basis that, prior to that happening, the administrators would pay into a trust account in their own name a sum equal to the total amount owing to the preferential creditors, from which account the preferential creditors would be paid, leaving the balance of the money in the administrators’ hands to be passed on to the voluntary liquidators for distribution pro rata to the unsecured creditors. The purpose of this was that a voluntary liquidation was the preferred exit route for the administration, but the preferential creditors would otherwise have been prejudiced by that course, as their preferential status would only arise under a compulsory liquidation.
Held: Section 18(3) could only be relied on to support a provision ‘which results directly or indirectly in the discharge of the administration order’. However, the purpose of the administration had effectively come to an end, and ‘[A] provision is consequential even though it will have to take effect immediately before the discharge because it is a direction which is being made to the administrators and they of course will cease to hold office on discharge of the administration order. As I see it, this particular direction is necessitated by the application for discharge since there will have to be a liquidation, and voluntary liquidation is the preferred route.’
Arden J therefore considered that the Court had ‘power to make the proposed direction provided that the administrators have power to make proposed payments to themselves on trust’. The combination of section 14 of, and paragraph 13 of Schedule 1, to the 1986 Act did enable the court to make such an order: ‘part of the function of the administrators is to bring the administration to a conclusion . . in the best interests of the creditors . . Under Schedule 1 the Administrators have the power to present a petition for the winding up of the company, in other words, the functions extend to bringing the administration to a conclusion and ensuring that the company is put into a position from which it can make distributions to creditors. As I see it, it is part of their function to put the company in that position and in a manner which is most advantageous to the creditors. In this particular case, this is achieved by first putting the company in a position whereby it can enter into voluntary liquidation. As I see it, the proposed payment to the administrators as trustees is a payment which will enable that process to be achieved and therefore comes within paragraph 13.’

Judges:

Mrs Justice Arden

Citations:

[2001] 1 WLR 436

Statutes:

Insolvency Act 1986 18(3)

Jurisdiction:

England and Wales

Cited by:

ApprovedIn re Luna Metal Products Ltd (in Administration) CA 14-Dec-2006
The administrators held cash. They proposed a distribution giving creditors who would on a winding up be preferential, full preference. They appealed refusal by the court to sanction the proposal.
Held: The court had no power to make such an . .
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 . .
Lists of cited by and citing cases may be incomplete.

Insolvency

Updated: 10 May 2022; Ref: scu.247767

Aiglon Limited and another v Gau Shan Co Limited: ChD 1993

The defendants had obtained world-wide Mareva injunctions in support of substantive proceedings by way of their counterclaim to enforce an arbitration award against the plaintiffs under section 26 against two companies, Aiglon Limited and L’Aiglon SA (a Swiss company).
Held: There was no basis under section 26 for enforcement of the arbitration award against SA, but the question arose whether any other basis for a freezing order against SA existed, having regard to the fact that the defendants’ only contractual entitlement was against Limited. There were two bases. It was well arguable that a transfer of assets from Limited to SA fell foul of section 423 of the Insolvency Act 1986, thereby giving the defendants a direct cause of action against SA as victims of the transaction. Second, since an administrator or liquidator of Limited (if appointed) could apply to set aside the relevant transaction under section 238 of the Insolvency Act 1986 with the consequence that SA would hold the assets transferred as trustee for Limited, the case fell within the Chabra jurisdiction since it was arguable that SA held assets beneficially belonging to Limited, against which the defendants had a good cause of action. It mattered not that Limited’s arguable beneficial interest in assets transferred to SA was contingent both upon the appointment of an administrator or liquidator of Limited, and the successful pursuit by the officeholder of a claim under section 238.

Judges:

Hirst J

Citations:

[1993] BCLC 1321

Statutes:

Arbitration Act 1950 26, Insolvency Act 1986 423

Cited by:

CitedHM Revenue and Customs v Egleton and others ChD 19-Sep-2006
The claimants had applied for the winding up of a company for very substantial sums of VAT due to it. Anticipating that hearing, it now sought restraining orders against the director defendants, alleging that there had been a carousel or missing . .
Lists of cited by and citing cases may be incomplete.

Litigation Practice, Arbitration, Insolvency

Updated: 10 May 2022; Ref: scu.245162

Re Lane-Fox: 1900

Citations:

[1900] QB 508

Jurisdiction:

England and Wales

Cited by:

CitedHill (As Trustee In Bankruptcy of Nurkowski) v Spread Trustee Company Ltd and Another CA 12-May-2006
The defendants sought relief for transactions entered into at an undervalue. The bankrupt had entered into charges and an assignment of a loan account in their favour before his bankruptcy, and the trustee had obtained an order for them to be set . .
Lists of cited by and citing cases may be incomplete.

Insolvency

Updated: 10 May 2022; Ref: scu.244176

Re Priory Garage (Walthamstow) Limited: ChD 2001

The court considered the relevance of a statutory limitation period in relation to applications to set aside transactions as being at an undervalue or as voidable preferences under section 238 to 241 of the 1986 Act. Applications to set aside transactions under the sections are generally actions on a specialty within the meaning of section 8 of the 1980 Act and subject to a 12 year limitation period accordingly; but where the substance of the claim is not to set aside a transaction, but to recover a sum of money, such applications will be governed by section 9, and thus subject to a six-year limitation period.

Judges:

John Randall QC

Citations:

[2001] BPIR 144

Statutes:

Insolvency Act 1986 238, Limitation Act 1980 8

Jurisdiction:

England and Wales

Cited by:

CitedHill (As Trustee In Bankruptcy of Nurkowski) v Spread Trustee Company Ltd and Another CA 12-May-2006
The defendants sought relief for transactions entered into at an undervalue. The bankrupt had entered into charges and an assignment of a loan account in their favour before his bankruptcy, and the trustee had obtained an order for them to be set . .
CitedNolan v Wright ChD 26-Feb-2009
The defendant sought to re-open the question of whether the charge under which he might otherwise be liable was an extortionate credit bargain. The creditor said that that plea was time barred. The defendant argued that a finding that the agreement . .
Lists of cited by and citing cases may be incomplete.

Insolvency, Limitation

Updated: 10 May 2022; Ref: scu.244183

Claughton v Charalambous: 1998

What is required of the court in applying section 335A(3) is, in effect, a value judgment. The court must look at all the circumstances and conclude whether or not they are exceptional. That process, he considered, left ‘very little scope for the interference by an appellate court’. The court here found a reason to suspend an order for possession where an occupier suffered a terminal disease.

Judges:

Jonathan Parker J

Citations:

[1998] BPIR 558

Statutes:

Insolvency Act 1986 335A(3)

Jurisdiction:

England and Wales

Cited by:

CitedDonohoe v Ingram ChD 20-Jan-2006
The appellant had lived with the bankrupt for several years, and sought an order delayng sale of the house they had lived in until their children had grown up. She said the circumstances were exceptional.
Held: The fact that the delay might . .
Lists of cited by and citing cases may be incomplete.

Insolvency

Updated: 10 May 2022; Ref: scu.238749

Midland Banking Co v Chambers: 1869

Citations:

(1869) LR 4 Ch App 398

Jurisdiction:

England and Wales

Cited by:

CitedIn re Melton, Milk v Towers CA 1918
In 1901 Richard Melton and another guaranteed to a Bank his son Arthur’s debts up to andpound;500. Richard died survived by his widow, Arthur and three daughters, giving his real estate to his widow for her life, with remainder to his four children . .
CitedIn re SSSL Realisations (2002) Ltd and Another; Squires and others v AIG Europe (UK) Ltd and Another CA 18-Jan-2006
A creditor claiming an equity in a debt but who himself owed money to the debtor, could not pursue his claim without first contributing the sum due. A person could not take an aliquot share out of a fund without first contributing what he owed to . .
Lists of cited by and citing cases may be incomplete.

Insolvency

Updated: 10 May 2022; Ref: scu.238734

Lynch Hall and Hornby (a Firm) v Thakerar (No 2): ChD 15 Nov 2005

The debtor had made an unsuccessful attempt to set aside a statutory demand. She did not then pay, and a third party debt order was made by the registrar in bankruptcy.
Held: The CPR applied to bankruptcy proceedings, and its powers could be exercised by a registrar acting in a bankruptcy, and to make the third party debt order.

Judges:

Lewison J

Citations:

Times 09-Jan-2006

Statutes:

Civil Procedure Rules 1.4

Jurisdiction:

England and Wales

Insolvency, Civil Procedure Rules

Updated: 10 May 2022; Ref: scu.237837

Re Brabon: 2001

The debtor had contracted to sell his land to a third party developer, Silver. Between contract and completion, the debtor was made bankrupt. His wife, who already held legal charges over part of the land, took a transfer of a charge over the remainder of the land from Nationwide Building Society and completed the contract by transferring the entirety of the land to Silver in exercise of her power of sale as mortgagee. It was contended that, for the purposes of section 423, the sale by the debtor’s wife as mortgagee to Silver was a sale at an undervalue which had been entered into by the debtor.
Held: The suggestion was rejected. The sale by the debtor’s wife as mortgagee could not be dismissed as ‘conveyancing mechanics’, and the transfers by the debtor’s wife effectively superseded the contract.

Judges:

Jonathan Parker J

Citations:

[2001] 1 BCLC 11

Jurisdiction:

England and Wales

Cited by:

CitedDepartment for Environment, Food and Rural Affairs v Feakins and Another ChD 26-Nov-2004
The farmer complained that the department had, during the foot and mouth outbreak destroyed animals which did not belong to the owner of the land. The department said that the farmer had disposed of his land at an undervalue to defeat his creditors. . .
CitedFeakins and Another v Department for Environment Food and Rural Affairs (Civ 1513) CA 9-Dec-2005
The department complained that the defendants had entered into a transaction with their farm at an undervalue so as to defeat its claim for recovery of sums due. The transaction used the grant of a tenancy by the first chargee.
Held: The . .
Lists of cited by and citing cases may be incomplete.

Insolvency

Updated: 10 May 2022; Ref: scu.237724

RA Securities v Mercantile Credit: 1995

The effect of an individual voluntary arrangement was not such as to release solvent co-debtors under the rule of law that the release of one of two or more joint debtors has the effect of releasing the other or others.

Citations:

[1995] 3 All ER 581

Cited by:

CitedJohnson and Another v Davis and Another CA 18-Mar-1998
The court was asked: ‘whether or not the appellants were released from their obligation under a covenant to indemnify the respondents against claims arising under a lease by reason of the terms of an individual voluntary arrangement made under part . .
Lists of cited by and citing cases may be incomplete.

Insolvency

Updated: 09 May 2022; Ref: scu.224362

In re Holliday: CA 1981

A property adjustment order cannot be made against a bankrupt former spouse because the property of the bankrupt vests in the trustee in bankruptcy against whom an order under section 24 cannot be made. It was highly unlikely that postponement of payment of the debts would cause any great hardship to any of the creditors.

Judges:

Sir David Cairns, Buckley LJ

Citations:

[1981] 1 Ch 405

Statutes:

Law of Property Act 1925 30

Jurisdiction:

England and Wales

Cited by:

CitedHarman v Glencross 1986
On the divorce, the wife applied for a property transfer order in relation to the jointly owned matrimonial home. A creditor of her husband then obtained a charging order on H’s interest. She sought its varation. The creditor said that there was . .
CitedDonohoe v Ingram ChD 20-Jan-2006
The appellant had lived with the bankrupt for several years, and sought an order delayng sale of the house they had lived in until their children had grown up. She said the circumstances were exceptional.
Held: The fact that the delay might . .
Lists of cited by and citing cases may be incomplete.

Family, Insolvency

Updated: 09 May 2022; Ref: scu.223620

Re Overmark Smith Warden Ltd: ChD 1982

An ordinary creditor’s cause of action for non-payment of a contract debt is barred after the expiration of 6 years from the date of the accrual of his cause of action. He is then no longer a creditor of the company and is neither entitled to present a winding up petition nor to prove for the statute barred debt in the liquidation.

Judges:

Slade J

Citations:

[1982] 1 WLR 1195

Statutes:

Companies Act 1948 257(1), Limitation Act 1939 2(1)(a)

Jurisdiction:

England and Wales

Cited by:

CitedRidgeway Motors (Isleworth) Ltd v Alts Ltd CA 10-Feb-2005
The company appelaed a refusal of the judge to strike out a winding up petition. They said the petition was based upon a judgment which was now time barred. The petitioner replied that such a petition was not an action under the section.
Held: . .
Lists of cited by and citing cases may be incomplete.

Limitation, Insolvency

Updated: 09 May 2022; Ref: scu.223041

Callender, Sykes and Co v Colonial Secretary of Lagos: PC 1891

Nigeria had no bankruptcy law of its own.
Held: The general vesting provisions of the Bankruptcy Act 1869 of the United Kingdom (and not merely provisions about reciprocal enforcement) applied in Nigeria.

Citations:

[1891] AC 460

Cited by:

CitedAl Sabah and Al Sabah v Grupo Torras SA Culmer as trustee of the property of Sheikh Fahad Mohammed Al Sabah, bankrupt PC 11-Jan-2005
PC (Cayman Islands) The claimant complained of an order of the Court of Appeal of the Cayman Islands, requiring him to comply with a letter of request from the Grand Court of the Bahamas.
Held: In earlier . .
Lists of cited by and citing cases may be incomplete.

Commonwealth, Insolvency

Updated: 09 May 2022; Ref: scu.222841

Re A Debtor (Order in Aid No 1 of 1979) ex parte Viscount of the Royal Court of Jersey: 1981

The court noted the differences in bankruptcy law between England and Jersey: ‘The word ‘bankruptcy’ in section 122, if indeed it refers at all to process of bankruptcy, must, in my judgment, be construed in a wide sense, for the section is designed to produce co-operation between courts acting under different systems of law, and it would be much restricted if extended only to jurisdictions which reproduce all the main features of English procedure. Dodd J took much the same view of a similar provision in the Bankruptcy (Ireland) Amendment Act 1872: see In re Bolton [1920] 2 IR 324, 327.’

Judges:

Goulding J

Citations:

[1981] Ch 384

Statutes:

Bankruptcy Act 1914 122

Jurisdiction:

England and Wales

Cited by:

CitedAl Sabah and Al Sabah v Grupo Torras SA Culmer as trustee of the property of Sheikh Fahad Mohammed Al Sabah, bankrupt PC 11-Jan-2005
PC (Cayman Islands) The claimant complained of an order of the Court of Appeal of the Cayman Islands, requiring him to comply with a letter of request from the Grand Court of the Bahamas.
Held: In earlier . .
Lists of cited by and citing cases may be incomplete.

Insolvency

Updated: 09 May 2022; Ref: scu.222846

Galbraith v Grimshaw and Baxter: HL 2 Jan 1910

Where a Scottish sequestration occurred shortly after an English garnishee order nisi, the judgment creditor prevailed over the trustee in bankruptcy, although the result would have been different if both the attachment and the bankruptcy had occurred in the same jurisdiction (whether England or Scotland). The attachment in England had not been completed, but the fact that it had started meant that the garnished debt was no longer ‘free assets’ of the bankrupt.
Lord Macnaghten said: ‘It may have been intended by the Legislature that bankruptcy in one part of the United Kingdom should produce the same consequences throughout the whole kingdom. But the Legislature has not said so. The Act does not say that a Scotch sequestration shall have effect in England as if it were an English bankruptcy of the same date. It only says that the Courts of the different parts of the United Kingdom shall severally act in aid of and be auxiliary to each other in all matters of bankruptcy. The English Court, no doubt, is bound to carry out the orders of the Scottish Court, but in the absence of special enactment the Scottish Court can only claim the free assets of the bankrupt. It has no right to interfere with any process of an English Court pending at the time of the Scotch sequestration.’
Lord Dunedin said that there should be only one universal process of the distribution of a bankrupt’s property and that, where such a process was pending elsewhere, the English courts should not allow steps to be taken in its jurisdiction which would interfere with that process: ‘Now so far as the general principle is concerned it is quite consistent with the comity of nations that it should be a rule of international law that if the court finds that there is already pending a process of universal distribution of a bankrupt’s effects it should not allow steps to be taken in its territory which would interfere with that process of universal distribution.’

Judges:

Lord Macnaghten, Lord Dunedin

Citations:

[1910] AC 508

Statutes:

Bankruptcy Act 1883 117

Jurisdiction:

England and Wales

Citing:

Appeal FromGalbraith v Grimshaw and Baxter CA 1910
A garnishee order nisi does not operate as a transfer of the property in the debt, but it is an equitable charge on it, and the garnishee cannot pay the debt to any one but the garnishor without incurring the risk of having to pay it over again to . .

Cited by:

CitedAl Sabah and Al Sabah v Grupo Torras SA Culmer as trustee of the property of Sheikh Fahad Mohammed Al Sabah, bankrupt PC 11-Jan-2005
PC (Cayman Islands) The claimant complained of an order of the Court of Appeal of the Cayman Islands, requiring him to comply with a letter of request from the Grand Court of the Bahamas.
Held: In earlier . .
CitedRubin and Another v Eurofinance Sa and Others SC 24-Oct-2012
The Court was asked ‘whether, and if so, in what circumstances, an order or judgment of a foreign court . . in proceedings to adjust or set aside prior transactions, eg preferences or transactions at an undervalue, will be recognised and enforced in . .
Lists of cited by and citing cases may be incomplete.

Insolvency

Updated: 09 May 2022; Ref: scu.222844

Meftah v Lloyds TSB Bank: ChD 2001

Receivers of property under charge are not obliged before sale to spend money on repairs.

Judges:

Lawrence J

Citations:

[2001] 2 All ER (Comm) 741

Jurisdiction:

England and Wales

Cited by:

CitedLloyds Bank Plc and others v Cassidy CA 1-Dec-2004
The defendant sought leave to appeal against orders for possession. The trial had been transcribed by the claimant. At the start of the application, a copy of the transcript was given to the judge but not the defendant despite his application.
Lists of cited by and citing cases may be incomplete.

Land, insolvency

Updated: 09 May 2022; Ref: scu.221430