Discovery Land Company, Llc and Others v Jirehouse (A Body Corporate) and Others: ChD 16 Aug 2019

Request for committal of a defendant, a solicitor, for contempt of court inter alia for breaches of undertakings given personally by him (and his firm) to pay surplus funds from a transaction amounting to $9.3 million or the sterling equivalent into court and to procure repayment of a loan of pounds 4.9 million to a lender called Dragonfly. he failed to do so. One of the issues which Zacaroli J had to consider was whether section 4 of the 1869 Act prevented the undertakings being enforced by committal. It was agreed that, in the light of Prosser v Prosser, section 4 did not apply to the undertaking in relation to the surplus funds, but it was argued that it did apply to the undertaking in relation to the repayment to Dragonfly.
Held: Section 4 did not apply: ‘Mr Halpern maintains that the Debtors Act applies to the undertaking in respect of the monies drawn down under the Dragonfly Facility, because that was an undertaking to repay money to Dragonfly. I disagree. The first task is to construe the undertaking. As I have pointed out, it was given in circumstances where Mr Jones had assured the court that the funds drawn down under the facility were sitting in a separate account with Hambros and that those funds were available to be transferred to Dragonfly (subject only to there being any problem arising from the terms of the facility itself). In my judgment, the undertaking to ‘procure’ that the facility was discharged is to be understood as an undertaking to procure that the funds so described would be transferred to Dragonfly. There is no question, therefore, of Mr Jones being required to ‘pay’ a debt which he owed, nor of paying anything from his own funds. Ms Felix made much of the point that the claimant would no doubt have been content if any money had been procured by Mr Jones, including from his own funds. I suspect that is correct, but there is an important difference between what the claimant would have been content with and what the undertaking, properly construed, required. The purpose of the Debtors Act is clearly not engaged in these circumstances.’

Zacaroli J
[2019] EWHC 2249 (Ch), [2020] PNLR 1
Debtors Act 1869 4
England and Wales
See AlsoDiscovery Land Company Llc and Others v Jirehouse and Others ChD 7-Jun-2019
The first claimant had requested the committal of a defendant for his alleged failure to comply with undertakings he had given to the court. He now sought an adjournment saying that he had not been advised of the availability of legal aid, and . .
CitedProsser v Prosser ChD 2011
A consent order had been made in proceedings between two brothers which provided that the respondent should instruct the solicitors acting for him on the sale of his property that the proceeds of sale were to be remitted to a nominated bank account. . .

Cited by:
Contempt FindingDiscovery Land Company, Llc and Others v Jirehouse and Others (Penalty) ChD 16-Aug-2019
. .
CitedHussain v Vaswani and Others CA 18-Sep-2020
Breach of Undertaking went Beyond Debt
The tenant had obtained a stay of execution of a warrant for possession, by undertaking to discharge the arrears. He failed to pay, and the Court now considered whether such a failure was a contempt with a possible imprisonment for punishment. The . .

Lists of cited by and citing cases may be incomplete.

Contempt of Court

Updated: 11 December 2021; Ref: scu.640886