(Outer House) Allegation of sale at an undervalue – Carnbroe had established that the sale of the Property was made for adequate consideration. Lord Woolman recorded the submission which counsel made on behalf of Carnbroe that Grampian was fighting for its survival and that Mr Quinn had to make a quick decision. He continued: ‘While the purchase price fell short of the open market value, Grampian had very limited options. It was in a perilous financial position. It could not afford the leisure of a lengthy marketing period. NatWest was threatening to call up the standard security and to use other diligence against it in terms of the bond and floating charge it held. There was no other offer on the table. The earlier expressions of interest were just that. There was no solid proposal to accept.
Carnbroe’s offer presented an opportunity to obtain a quick sale. To place the property on the open market would have involved significant expense. There would have been advertising costs and an estate agency fee of 1% to 1.5%. There was no clear indication that a sale would be achieved within the standard marketing period of 12 to 24 months. According to the surveyors’ evidence, a stigma can attach to a property that remains on the market too long. It might be the subject of vandalism.’
He went on the state that Mr Quinn and Mr Gaffney were not ‘associates’ in terms of the relevant legislative definition, but their long business relationship justified close scrutiny of the transaction. The expert surveyors had agreed that a price of pounds 550,000 was not inappropriate if the Property had been marketed on a closed basis for six months.
Judges:
Lord Woolman
Citations:
[2017] ScotCS CSOH – 8
Links:
Statutes:
Jurisdiction:
Scotland
Cited by:
Appeal from – Liquidators of Grampian Maclennan’s Distribution Services Ltd Reclaiming Motion By, v Carnbroe Estates Ltd SCS 23-Jan-2018
First Division, Inner House, Court of Session – allegation of sale at an undervalue. The liquidator appealed a finding that as a speedy sale was required the sale price was proper.
Held: The reclaiming notice was allowed. The sale of the . .
At Outer House – MacDonald and Another v Carnbroe Estates Ltd SC 4-Dec-2019
‘This appeal concerns the Scots law of gratuitous alienations on insolvency. It raises three principal questions. First, there is a question as to the interpretation of the term ‘adequate consideration’ in section 242(4)(b) of the Insolvency Act . .
Lists of cited by and citing cases may be incomplete.
Insolvency
Updated: 09 May 2022; Ref: scu.578157