The plaintiff supplied petrol to the defendant but had not been paid. Anticipating the defendant winding up, the plaintiff got judgment and a charging order nisi. The defendant appealed against that order being made absolute, saying that this gave the plaintiff an unfair advantage in the winding up. The defendant appealed against the re-instatement of the charging order absolute.
Held: The defendant’s appeal succeeded. A charging order nisi is precarious until it is made absolute; and there is a discretion whether or not to make it absolute when the matter comes back before the court. As to the exercise of that discretion.
a) The burden of showing cause why an interim order shall not be made final is on the judgment debtor; and
b) In exercising its discretion, the court must take into account all the relevant circumstances whether they arose before or after the interim order.
Lord Brightman said that the court should assist the judgment creditor to recover the debt due to it, and ‘A judgment creditor is in general entitled to enforce a money judgment which he has lawfully obtained against a judgment debtor by all or any of the means of execution prescribed by the relevant rules of court.’ As to the steps available for the regulation of the enforceent of money claims, he said: ‘Neither step not counterstep casts any discredit on those involved . . A person who has the misfortune to have given credit to a company which runs into financial difficulties has every right to seek to secure himself. And such company or its other creditors have every right to hasten liquidation in order to thwart such a purpose’.
Judges:
Lord Brightman
Citations:
[1983] 2 AC 192, [1983] 1 All ER 564, [1983] BCLC 28, [1983] 2 WLR 305
Statutes:
Jurisdiction:
England and Wales
Citing:
Appeal from – Roberts Petroleum Ltd v Bernard Kenny Ltd (in liquidation) CA 1982
The plaintiffs had supplied petrol to the defendant who owned two filling stations. The defendant prepared a statement of affairs ready to hold a meeting of creditors. The plaintiffs took their claim to judgement and obtained a charging order nisi . .
Not approved – Burston Finance Ltd v Spierway Ltd ChD 1974
The lender took a charge over a property held by a company which subsequently became void because it was not registered within the required period at Companies House.
Held: A voidable charge is a valid charge unless and until set aside: . .
Cited by:
Applied – Clarke v Coutts and Co CA 17-Jun-2002
The respondent bank had obtained a charging order nisi against the applicant’s property. The applicant then obtained an order under s252 of the act requiring any further action against his estate to be stayed. The bank nevertheless obtained an order . .
Cited – In re Buckingham International Plc and In the Matter of Insolvency Act 1986; Mitchell v Buckingham International Plc CA 16-Feb-1998
. .
Cited – Ropaigealach v Allied Irish Bank Plc CA 12-Nov-2001
. .
Cited – Westacre Investments Inc v The State-Owned Company Yugoimport SDPR ComC 21-Apr-2008
. .
Cited – Kier Regional Ltd (T/A Wallis) v City and General (Holborn) Ltd and others TCC 17-Oct-2008
kier_cityTCC2008
The claimant sought to make final an interim third party debt order. The defendants sought a stay of the enforcement. . .
Lists of cited by and citing cases may be incomplete.
Insolvency, Litigation Practice
Updated: 28 April 2022; Ref: scu.181249