A floating charge was given over the whole of a company’s property which might from time to time be ‘comprised in our property and undertaking’. The charge terms echoed the section which allows a company to create a charge ‘over all or any part of the property . . which may from time to time be comprised in its property and undertaking.’ The company had sold a flat, which was part of its property, and had delivered the relevant disposition to the purchaser. Before the purchaser’s agents recorded the disposition, however, the floating charge crystallised. The question was whether, at the time of crystallisation, the company’s rights to the flat still formed part of ‘our property and undertaking’ in terms of the charge and, by implication, in terms of the section. The Court of Session had held that the rights were caught by the floating charge.
Held: The purchasers’ appeal was allowed on the basis that the term ‘property’ in the section was not being used in any technical sense and was not intended to include the company’s bare title to the flat which the purchasers could have defeated at any moment by recording their disposition.
Judges:
Lord Jauncey, Lord Clyde
Citations:
1997 SC (HL) 66, [1997] UKHL 60, [1998] BCC 115, 1997 SC (HL) 66, 1997 SCLR 328, 1997 GWD 9-364, [1997] 1 BCLC 603, 1997 SLT 636
Links:
Statutes:
Jurisdiction:
Scotland
Citing:
Appeal from – Sharp and Another v Thomson and Others IHCS 25-Jul-1995
The Plaintiff was bound by a floating charge which crystallised on the land before registration. Scots law, following Roman law, is unititular, which means that only one title of ownership is recognised in any one thing at any one time. . .
Cited by:
Distinguished – Burnett’s Trustee v Grainger and Another HL 4-Mar-2004
A flat was sold, but before the purchasers registered the transfer, the seller was sequestrated, and his trustee registered his own interest as trustee. The buyer complained that the trustee was unjustly enriched.
Held: The Act defined the . .
Cited – National 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.
Land, Banking
Updated: 10 June 2022; Ref: scu.194212