swarb.co.uk - law index
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Insolvency - From: 1930 To: 1959
This page lists 39 cases, and was prepared on 08 August 2015.
In re Home & Colonial Insurance Co Ltd [1930] 1 Ch. 102
1930
Insolvency
1 Citers
In re Fenton [1931] 1 Ch 85
1931
CA
Lord Hanworth MR, Lawrence and Romer LJJ
Insolvency
A surety under a pre-insolvency guarantee, had not actually paid, and could not pay, being bankrupt with his assets vested in the trustee. The creditor was still owed the money and entitled to prove in the liquidation. Held: One could not have more than one proof in respect of the same debt ("the rule against double proof"); otherwise, if there had been, say, four guarantors, there could have been five people receiving dividends on the same debt. Also. until the creditor had been paid, he had the superior right of proof and a proof by a surety was excluded. Lastly, a debt which could not be proved could not be relied upon for set-off. If the guarantor had paid off the debt after the insolvency date, he would have been entitled to set it off against a debt which he owed to the company.
1 Citers
Re Osborn [1931-2] B & CR 189
1931
Farwell J
Insolvency
An Isle of Man trustee in bankruptcy was seeking the assistance of the English court in relation to the bankrupt's immovable property in England. Held: Section 122 was to be given a cautious interpretation.
Bankruptcy Act 1914 122
1 Citers
Re Vocalion (Foreign) Ltd [1932] 2 Ch 196
1932
Maugham J
Insolvency
The section only applies only to proceedings pending in the UK, and not to proceedings in a foreign Court. The Court has an equitable jurisdiction in personam to restrain a respondent properly served in this country from proceeding with an action brought in a foreign to enforce a liability incurred abroad. But as against a respondent domiciled abroad, substantial justice is more likely to be attained by allowing the foreign proceedings to continue, and in such a case the Court will not as a rule exercise that jurisdiction.
Companies Act 1929 177
1 Citers
Re Warren; ChD 1932 - [1938] Cl 725; [1932] 1 Ch 42
Bombay Official Assignee -v- Shroff; PC 1932 - (1932) 48 TLR 443 PC
The Attorney General of Quebec -v- The Attorney General of Canada; PC 9-Feb-1932 - [1932] UKPC 6; Appeal No. 135 of 1929
In re Russian Bank for Foreign Trade [1933] Ch 745
1933
Insolvency, Banking
Soviet legislation involved an extinguishment of the rights and obligations of the commercial banks and the creation of equivalent obligations on the part of a new State Bank.
1 Citers
In re Beni-Felkai Mining Co Ltd; 1933 - [1934] 1 Ch 406; [1933] All ER 693
In re Simms; CA 1934 - [1934] 1 Ch 1
Peat -v Gresham Trust Ltd; HL 1934 - [1934] AC 252; [1934] All ER 82
Re Yagerphone Ltd [1935] Ch 392
1935
Company, Insolvency
A sum recovered from a creditor who has been wrongly preferred enures for the benefit of the general body of creditors, not for the benefit of the company or the holder of the floating charge. It does not become part of the company's assets but is received by the liquidator impressed with a trust in favour of those creditors amongst whom he has to distribute the assets of the company.
1 Citers
James Smith & Sons (Norwood) Ltd -v- Goodman; CA 1936 - [1936] Ch 216
Stewart -v- Jarvie 1938 SC 309
1938
IHCS
Lord Moncrieff
Scotland, Insolvency
The permanent trustee acts under the statute for each and every one of the creditors of the sequestered individual, not for himself as an individual.
1 Citers
Macdonald's Trustee -v- Macdonald 1938 SC 536
1938
Scotland, Insolvency
So much income received by a debtor as exceeds his needs, as determined by the Sheriff, may require to be paid to the permanent trustee. The 1921 Act did not override
Police Pensions Act 1921 14(1) - Bankruptcy (Scotland) Act 1913 98(2)
1 Citers
Re Oceanic Steam Navigation Co Ltd; 1939 - [1939] Ch 41
In re Metropolis Estates Co Ltd [1940] 3 All ER 522
1940
CA
Landlord and Tenant, Insolvency
1 Citers
Potts -v- Hickman [1941] AC 212
1941
HL
Viscount Simon LC
Landlord and Tenant, Insolvency
The Plaintiff was the landlord of certain premises and had as at 29 September 1938, a right to distrain for unpaid rent in the sum of �15 11s. However, on 20 September, the defendant, as bailiff for Wolverhampton Corporation, had levied on the tenant under a warrant for distress for rates granted by a justice of the peace for the borough on 11 August pursuant to Distress for Rates Act 1849. Held: The levying of a distress for poor rates under a justice's warrant was not an "execution" within section 1 Landlord and Tenant Act 1709 (called in this case "the Act of Anne"). The issue was whether the distress was an execution within section 1 of the 1709 Act. The section referred to "the party at whose suit the execution is sued out" and to a process to be executed by "the sheriff or other officer" resulting in payment "to the plaintiff'. The wording led to the conclusion that, in this context, "execution" referred to the process of enforcing a judgment obtained inter partes. Although the distress warrant was stated to be "in the nature of an execution" it was not a process to enforce payment of a debt ascertained by a previous judgment. As to the possibility of a wider meaning of "execution": "The House has been much assisted by the learning and research of counsel on both sides, and we further have the advantage of the full and carefully reasoned judgment of Goddard L.J. delivered on behalf of the Court of Appeal. [see at [1940] 1 KB 38.D] If the test which would determine the present controversy were completely stated by asking whether the lawyers of 1709 would have regarded the levying of a distress of rates as an execution, there would indeed be a great deal to be said for the learned Lord Justice's conclusion. Ten years before the Act of Anne was passed, Holt C.J. in the deer-stealing case Rex v. Speed had said that "when a statute says money 'shall be levied by distress,' that is an execution." In Hutchins v. Chambers, where the question was whether beasts of the plough were privileged from distress for poor rates and it was decided that they were not, Lord Mansfield quotes with approval the following passage from 3 Salkeld, p. 136: "This common-law exemption of utensils, tools, instruments of husbandry etc. from distress holds only in distress for rent arrear, amerciaments etc., but doth not extend to cases where a distress is given in the nature of an execution by any particular statute; as for poor rates." "Therefore", adds Lord Mansfield, "it is more analogous to an execution than to a distress at common law, and there (in cases of execution) averia carucae may be distrained; although there be other sufficient distress."
Landlord and Tenant Act 1709 1
1 Citers
In re Griffin Hotel Co Ltd [1941] Ch 129
1941
ChD
Bennett J
Company, Insolvency
A company owned hotels, in Leeds and in Buxton. In 1937, it issued a debenture creating a floating charge over all its assets to secure £45,000. In December 1938, an order was made in a debenture holder's action, appointing a receiver over all the company's property except the Buxton Hotel which was subject to a prior mortgage and of no value to the debenture holder. The company continued to operate the Buxton Hotel. In March 1939, an order was made for the winding up of the company. In the meantime, in operating the Buxton Hotel, the company incurred certain preferential debts within the meaning of s. 264 of the 1929 Act. One issues was whether those preferential debts were payable in priority to the plaintiff (the debenture holder) from the proceeds of the assets over which the receiver was appointed in 1938. There were no other assets out of which the preferential debts could be discharged. The first issue related to the relationship between sections 78 and 264(4)(b) which is not of relevance. The second issue is the same construction issue arising in these proceedings, albeit in relation to s. 264(4)(b), providing: "The foregoing [preferential] debts shall: (a) rank equally among themselves and be paid in full, unless the assets are insufficient to meet them, in which case they shall abate in equal proportions; and (b) in the case of a company registered in England, so far as the assets of the company available for payment of general creditors are insufficient to meet them, have priority over the claims of holders of debentures under any floating charge created by the company, and be paid accordingly out of any property comprised in or subject to that charge." Held: The court construed the expression 'floating charge' in the statute to mean a charge which was still floating at the date of the winding up.
Bennett J, having expressed his conclusion that s. 78 of the 1929 Act did not exclude or prevent the operation of sub-section 4(b) of s. 264, continued: "But that conclusion on the construction and effect of the statutory provisions leaves open the question whether in the supposed events there is, when the winding up take place, any floating charge or any property subject to that charge. In my judgment, sub-s. 4(b) of s. 264 only operates if at the moment of the winding up there is still a floating charge created by the company and it only gives the preferential creditors a priority over the claims of the debenture holders in any property which at that moment of time is comprised in or subject to that charge.
In the present case, the debenture held by the plaintiffs contained a floating charge over all the borrowers' property. On December 9, 1938, that charge ceased to float on the property and assets of which Mr. Veale was appointed receiver. The charge on that day crystallised and became fixed on that property and those assets. It remained a floating charge on any other assets of the borrowers. At the moment before the winding up order was made, the charge still floated over any other assets of the borrowers and over those other assets, if any, the preferential creditors as defined by sub-s. I of s. 264 have a priority over the claims of the plaintiffs by force of the provisions of sub-s.4 of the same section. This seems to be a corollary of the proposition established by In re Lewis Merthyr Consolidated Collieries, Ld. (I) [1929] 1 Ch. 498."
Companies Act 1929 78 264
1 Citers
In re Apex Supply Co Ltd; 1942 - [1942] Ch 108
Re Welsh Brick Industries Ltd [1946] 2 All ER 197
1946
CA
Lord Greene MR
Insolvency
In a disputed debt case a winding-up order had been made by the county court judge. Notwithstanding that the company had been given unconditional leave to defend the petitioner's action in the King's Bench Division for recovery of the debt, it was held that the winding-up court was not precluded from going into the merits of the dispute for itself and the order made below was affirmed. Lord Greene quoted Buckley on the Companies Acts: "A winding-up petition is not a legitimate means of seeking to enforce payment of a debt which is bona fide disputed by the company. A petition presented ostensibly for a winding-up order but really to exercise pressure will be dismissed and under circumstances may be stigmatised as a scandalous abuse of the process of the court. Some years ago petitions founded on disputed debt were directed to stand over till the debt was established by action. If, however, there was no reason to believe that the debt, if established, would not be paid, the petition was dismissed. The modern practice has been to dismiss such petitions. But, of course, if the debt is not disputed on some substantial ground, the court may decide it on the petition and make the order."
1 Citers
Re Armstrong Whitworth [1947] Ch 763
1947
Insolvency
Four workmen who had suffered pre-liquidation accidents but had made post-liquidation claims had, at the date of the winding up, "contingent claims".
1 Citers
W T Lamb and Sons -v- Rider [1948] 2 KB 331
1948
CA
Scott L
Insolvency, Limitation
The judge at first instance had rescinded the master's order giving leave to the judgment creditor to proceed to levy execution although six years had passed since the judgment. On appeal the judgment creditor challenged the validity of the rule of court dating from 1883 requiring leave to proceed to levy execution. It was contended that the rule was in conflict with s2(4). It subjected the right of execution, if not exercised within 6 years, to the discretion of the court. The judgment creditor argued that it was entitled by statute to bring an action upon the judgment and to issue execution, which was "a proceeding in a court of law" and therefore an "action upon a judgment." Such an action could be brought, without obtaining the leave of the court, within 12 years from the date on which the judgment became enforceable. Held: The expression "an action upon any judgment" in s 2(4) of the 1939 Act was interpreted to apply only to suing for a judgment upon a judgment. It did not apply to execution of a judgment. The Court rejected the contention that the provision in the Rules of the Supreme Court (O 42 r23(a)), requiring a judgment creditor, after the elapse of 6 years from the date of the judgment, to obtain the leave of the court to levy execution, was rendered invalid by s2(4) of the 1939 Act, which allowed 12 years for bringing an action upon any judgment as of right. Scott LJ: The 12 year limitation period set in the 1939 Act dealt only with the "substantive right to sue for and obtain a judgment, and with that alone;" the period did not apply to the "procedural machinery for enforcing a judgment when obtained." The broad definition of "action " in the 1939 Act did not have the effect of merging what had formerly been the two "quite independent and distinct" subjects of (a) the substantive right to sue for and obtain a judgment and (b) the procedural machinery for enforcing a judgment when obtained. It did not cover an application to the court for leave to levy execution on the judgment after the expiration of 6 years.
Limitation Act 1939 2(4)
1 Citers
Jones -v- Bellgrove Properties Limited [1949] 2 KB 700
1949
Limitation, Insolvency
The court allowed the plaintiff to establish by evidence that his particular debt was included in the total sum acknowledged to be due to a number of creditors.
1 Citers
In re Kavanagh [1949] 2 All ER 264
1949
KBD
Insolvency
Before her bankruptcy the bankrupt had sued her former solicitor for breach of confidence. The claim was pending at the date of her bankruptcy but later settled on terms which involved the defendant paying damages. The bankrupt claimed that the damages were attributable to damage to her reputation and therefore payable to her and not her trustee; the trustee in bankruptcy argued they were not, and were therefore part of her estate and payable to him. Held: Where sums received in a single suit are partly attributable to injury to credit and reputation and partly to injury to property, there may be a right to apportion. The sum fell to be divided equally.
1 Citers
Theophile -v- Solicitor-General [1950] AC 186
1950
HL
Lord Porter
Insolvency
The House was asked as to the legitimacy of making bankrupt, on the basis of debts unpaid in respect of his English trading, a foreigner who had left the jurisdiction. Held: A business continues until sums due are collected and all debts paid.
Lord Porter said: "(T)rading does not cease when, as the expression is, 'the shutters are put up,' but continues until the sums due are collected and all debts paid." The person concerned could not take exception to such an order "though it may be he will escape from compliance with its terms because he is out of the jurisdiction and cannot be reached by English process."
1 Citers
RMR Housing Society Ltd -v- Combs; 1951 - [1951] 1 KB 486
Re Suidair International Airways Ltd [1951] Ch 165
1951
Wynn-Parry J
Insolvency
Insolvency law may enable the court to apply a foreign law. Wynn-Parry J said: "It appears to me that the simple principle is that this court sits to administer the assets of the South African company which are within its [i.e. the English court's] jurisdiction, and for that purpose administers, and administers only, the relevant English law; that is, primarily, the law as stated in the Companies Act 1948 looked at in the light, where necessary, of the authorities. If that principle be adhered to, no confusion will result. If it is departed from, then for myself I cannot see how any other result would follow than the utmost possible confusion."
1 Citers
Re Banque des Marchands de Moscou (Koupetschesky) [1952] 1 All ER 1269
1952
Banking, Insolvency
1 Citers
Bradley-Hole -v- Cusen; CA 1953 - [1953] 1 QB 300; [1953] 1 All ER 87
Re B Johnson & Co (Builders) Ltd; CA 1953 - [1953] Ch 634
In re Banque des Marchands de Moscou (Koupetschesky) (No 2); CA 1954 - [1954] 2 All ER 746; [1954] 1 WLR 1108; 98 Sol Jo 557
In re Majory, a debtor; CA 1955 - [1955] Ch 600
Government of India -v- Taylor; HL 1955 - [1955] AC 491
In re A Debtor (No 66 of 1955), Ex parte The Debtor -v- Trustee of Waite (A Bankrupt); ChD 1956 - [1956] 1 WLR 480
In re Donald Kenyon Ltd [1956] 1 WLR 1397
1956
Roxburgh J
Company, Insolvency
The company contributories petitioned for the restoration of the company so that they could get in a sum of money standing to the credit of the company's account at a building society. Held: Fairness required that the restoration should be on terms that time should not run during the period of dissolution against creditors whose claims were not statute-barred at the date of dissolution whose claims were not statute-barred at that date: ".... what I have to do is put all other persons � not only the company, but all other persons � in the same position as nearly as may be as if the name of the company had not been struck off. At the date of the dissolution, the creditors .... who were not statute-barred at the date of dissolution .... could have stopped the statute running by issuing, possibly serving, a writ. [Counsel for the petitioner] contends that the creditor could also have applied to restore the name of the company to the register and then have issued his writ. Of course he could, but that is not the same position, nor is it, in my judgment, the nearest that can be done to get to the 'as-you-were position'; and it seems to me that, when a company has been dissolved and therefore nobody can sue it without getting it restored to the register, it is only common fairness that, if the contributories for purposes of their own, want to get it restored to the register years afterwards, the period [of dissolution] should be disregarded for the purposes of the Statute of Limitations. .... Common justice requires that some such provision should be inserted."
1 Citers
In re Cutts [1956] 1 WLR 728
1956
Taxes Management, Insolvency
Bankruptcy Act 1914 44(1)
1 Citers
In re A Debtor (No 66 of 1955), Ex parte The Debtor -v- Trustee of Waite (A Bankrupt); CA 2-Jan-1956 - [1956] 1 WLR 1226
Re Eichholz [1959] Ch 708
1959
Harman J
Insolvency
The court left open the question whether, if the proceedings were brought by a trustee in bankruptcy, a representative creditor had to be joined.
1 Citers