Tag: Insolvency

In re William Andrew Malcolm; William Andrew Malcolm v Benedict Mackenzie, Allied Dunbar: ChD 26 Feb 2004

The bankrupt sought to protect his personal pension taken out before his bankruptcy. The bankruptcy was initiated by the Inland Revenue, and sought protection under Human Rights law.
Held: The alleged infringement of the former bankrupt’s rights had taken place before the coming into force of the Human Rights Act 1998, and he could therefore only rely on that Act if the retrospective provision of section 22(4) applied. That section would only have effect if the proceedings were instigated by a public authority. The proceedings here were begun by the trustee in bankruptcy. The bankrupt could not rely upon protection by the 1998 Act.

Judges:

The Hon Mr Justice Lloyd

Citations:

Gazette 01-Apr-2004, [2004] EWHC Ch 339

Links:

Bailii

Statutes:

Human Rights Act 1998 22(4)

Jurisdiction:

England and Wales

Cited by:

Appeal from – Malcolm v Mackenzie, Allied Dunbar Plc CA 21-Dec-2004
The bankrupt complained that having been made bankrupt, his self-employed pension was subject to attachment by his trustee, but had he been a member of a company scheme the asset would not, and that this was discriminatory.
Held: The . .
Lists of cited by and citing cases may be incomplete.

Human Rights, Financial Services, Insolvency

Updated: 10 June 2022; Ref: scu.193898

Mulkerrins v Pricewaterhousecoopers (A Firm): ChD 29 Mar 2000

Where a bankrupt wished to pursue an action held for him personally rather than his creditors.
Held: The trustee in bankruptcy held the right of action in trust for the bankrupt, but declined to sue. The bankrupt had the right to join the trustee as a co-defendant and to commence the action under his own name.

Citations:

Times 29-Mar-2000, Gazette 06-Apr-2000

Statutes:

Insolvency Act 1986 303

Jurisdiction:

England and Wales

Citing:

Appeal to – Mulkerrins v Pricewaterhousecoopers (A Firm) CA 12-Jan-2001
A trustee in bankruptcy had had vested in him the legal title to an action for damages for the loss to personal reputation and status of the bankrupt.
Held: A declaration that he had no interest in a claim for damages against a former . .

Cited by:

Appeal from – Mulkerrins v Pricewaterhousecoopers (A Firm) CA 12-Jan-2001
A trustee in bankruptcy had had vested in him the legal title to an action for damages for the loss to personal reputation and status of the bankrupt.
Held: A declaration that he had no interest in a claim for damages against a former . .
Lists of cited by and citing cases may be incomplete.

Insolvency

Updated: 10 June 2022; Ref: scu.84112

Re Co-Operative Bank Plc: ChD 18 Nov 2013

Application by the Co-operative Bank Plc for an order convening a single meeting of creditors for the purpose of considering and, if thought fit, approving a scheme of arrangement to section 896 of the 2006 Act.

Judges:

Hildyard J

Citations:

[2013] EWHC 4072 (Ch)

Links:

Bailii

Statutes:

Companies Act 2006 896

Jurisdiction:

England and Wales

Company, Insolvency

Updated: 09 June 2022; Ref: scu.519221

In the Matter of Drax Holdings Limited and in the Matter of InPower Limited: ChD 17 Nov 2003

A company incorporated in Jersey comes within the Act for the purposes of the section. An English court has jurisdiction to wind up a foreign company if it has assets here or some other sufficient connection with this country.

Judges:

Mr Justice Lawrence Collins

Citations:

[2003] EWHC 2743 (Ch), [2004] 1 WLR 1049, [2004] 1 BCLC 10

Links:

Bailii

Statutes:

Companies Act 1985 425

Jurisdiction:

England and Wales

Citing:

Cited – In the Matter of Hawk Insurance Company Limited CA 23-Feb-2001
Arrangements for putting in place voluntary arrangements for companies. Discussing Sovereign Insurance: ‘When applying Bowen LJ’s test to the question ‘are the rights of those who are to be affected by the scheme proposed such that the scheme can be . .

Cited by:

Cited – In re Telewest Communications Plc ChD 26-Apr-2004
A scheme of arrangement had been proposed. The creditor complained that in providing for payment in a currency other than that agreed, it had been prejudiced.
Held: The provision in the scheme did purport to alter the claimant’s rights. . .
Cited – McGrath and others v Riddell and others HL 9-Apr-2008
(Orse In Re HIH Casualty and General Insurance Ltd)
HIH, an Australian Insurance company, became insolvent. An order was sought for the collection and remission of it assets in England under a letter of request from the Australia Court.
Lists of cited by and citing cases may be incomplete.

Company, Insolvency

Updated: 08 June 2022; Ref: scu.188058

Official Receiver v Wadge Rapps and Hunt (a firm) and another and two other actions: HL 31 Jul 2003

(Orse In re Pantmaenog Timber Co Ltd)
The Receiver sought to use information obtained under section 236 (documents recovered from the directors’ solicitors) in disqualification proceedings.
Held: The appeal succeeded. The Act had explicitly given the requisite powers to the receiver whether or not he was the liquidator. Nor was the purpose of the use restricted. The task of the receiver was not just to collect and get in the assets of the company, but also to carry out the other acts expected of him. Section 236 extended the meaning of ‘office-holder’ in this context to the Official Receiver, who was duty bound to investigate and report. His functions in a winding up were not limited to the collection and redistribution of the assets, but included investigation of its officers for the purpose of the public good of testing their conduct. The two Acts were intended to work together. The need to protect the public justified a wider reading of the statutes if necessary.
The section was constructed on the basis that such applications would be better made by the Official Receiver than the Secretary of State, because of his close knowledge of the company’s affairs. The power was not restricted by the grant of similar but more limited powers under the Disqualification Act. A restriction of the kind sought would severely limit the powers in insolvency properly to investigate the company’s actions.

Judges:

Lord Steyn, Lord Hoffmann, Lord Hope of Craighead, Lord Millett, Lord Walker of Gestingthorpe

Citations:

[2003] UKHL 49, [2003] BCC 659, [2003] 2 BCLC 257, [2003] 4 All ER 18, [2004] 1 AC 158, [2004] BPIR 139, [2003] 3 WLR 767

Links:

Bailii, House of Lords

Statutes:

Insolvency Act 1986 236, Company Directors Disqualification Act 1986

Jurisdiction:

England and Wales

Citing:

Appeal from – In re Pantmaenog Timber Co Ltd CA 25-Jul-2001
The Official Receiver could not use the powers given to him for the purposes of his insolvency duties to require production of documents form solicitors and accountants, to satisfy duties placed on him by the Secretary of State for the purpose of . .
Cited – In re Polly Peck International plc, Ex parte the joint administrators ChD 1994
The purposes of a liquidation, or administration or receivership of a company must include the gathering of information as to the conduct of the affairs of the company, and those who had conducted them so that the office-holder can report to the . .
Cited – Bishopsgate Investment Management Ltd (in Liquidation) v Maxwell CA 16-Feb-1993
The fundamental wrong in the directors’ acts lay in the signing of transfers of the company’s assets and not entirely in their failure properly to enquire as to the nature of other transaction. The breach of fiduciary duty lay in positive acts. . .
Cited – In re Paget CA 1927
The purpose of the public examination of a debtor is not merely to obtain a full and complete disclosure of his assets and the facts relating to the bankruptcy in the interests of the creditors, but also to protect the public: ‘To concentrate . .
Cited – In re London and Globe Finance Corporation Ltd ChD 1903
A company which had gone from voluntary winding up, first to winding up under supervision and then to compulsory winding up, with the official receiver as liquidator. The company’s former managing director was suspected of fraud, but the law . .
Cited – In re Jeffrey S Levitt Ltd ChD 1992
The provisions of the two Acts are intended to be part of the same statutory scheme and are to be read in combination. . .
Cited – In re John Tweddle and Company Ltd CA 1910
The court discussed the official receiver’s enquiries and report leading up to the public examination of former directors. Farwell LJ said: ‘Now those are functions of a judicial character which are cast upon him, not in the liquidation of the . .
Cited – Bishopsgate Investment Limited v Maxwell CA 1999
A person required to answer questions under the section may not refuse to answer on the ground of self-incrimination. (Dillon LJ) ‘It is plain to my mind – and not least from the Cork Report – that part of the mischief in the old law before the . .
Cited – Re North Australian Territory Co 1890
The powers given under the sections should not be used oppressively. . .
Cited – In re British and Commonwealth Holdings plc (Nos 1 and 2) HL 1993
Section 236 extended the power of a liquidator to require from the company’s officers all the documents he would reasonably need in order to fulfil his duties under the Act.
Lord Slynn said: ‘The protection for the person called upon to produce . .
Lists of cited by and citing cases may be incomplete.

Insolvency, Company

Updated: 07 June 2022; Ref: scu.185421

Household Mortgage Corporation plc v Whitehead and Another: CA 14 Nov 2002

The mortgage lender had proved in the voluntary arrangement as an unsecured creditor. It had valued the security as less than the debt, and accepted a dividend on the portion remaining unsecured. It now sought to enforce the security. It was argued that it had compromised its entire claim.
Held: The lender had compromised its claim for that part of the debt which was unsecured, but that did not affect its ability to claim the rest under the security. The rules made provision for this, for bankruptcy but did not apply directly to a voluntary arrangement. However the court should be slow to create different conditions for arrangements. Absent an express term in an IVA, the court should be slow to imply a term that, by participating in and accepting payment of a dividend, a secured creditor had agreed to treat part of his debt as unsecured.

Judges:

Chadwick, Sedley, Scott-Baker LJJ

Citations:

Times 29-Nov-2002, Gazette 30-Jan-2003, [2002] EWCA Civ 1657, [2003] 1 WLR 1173, [2003] 2 FCR 369, [2003] 1 All ER 319, [2003] 6 BPIR 1482, [2003] 1 All ER (Comm) 263

Links:

Bailii

Statutes:

Insolvency Rules 1986 (1986 No 1925) Part 6 Chapter 9

Jurisdiction:

England and Wales

Citing:

Application for leave – Whitehead and Another v Household Mortgage Corporation Plc CA 27-May-2002
Renewed application for leave to appeal. . .

Cited by:

Cited – Webb v Macdonald and Another ChD 29-Jan-2010
Defendant barrister and solicitors applied to have the claims against them for professional negligence struck out. They had advised on a settlement of a dispute, which settlement the claimant now said was negligently wrong.
Held: The advice . .
Lists of cited by and citing cases may be incomplete.

Insolvency, Banking

Updated: 06 June 2022; Ref: scu.178269

Official Receiver v Mckay: CA 16 Jun 2009

The defendant had incurred substantial costs failing to defend her challenge to the assessment of damages after a minor road accident. After non-payment, she was made bankrupt, and the trustee had refused her discharge from bankruptcy for her refusal to co-operate. When the original cerditor withdrew her claim for costs, the bankruptcy was annulled. The bankrupt objected to the annullment.

Judges:

Mummery, Lloyd LJJ, Sir Paul Kennedy

Citations:

[2009] EWCA Civ 467, [2009] BPIR 1061, [2010] 2 WLR 891, [2010] 1 Ch 303

Links:

Bailii

Jurisdiction:

England and Wales

Insolvency

Updated: 06 June 2022; Ref: scu.346910

Stocznia Gdanska Sa v Latvian Shipping Company and others: CA 23 Jul 2002

Application for leave to appeal to the House of Lords refused.

Judges:

Aldous, Tuckey, RixLJJ

Citations:

[2002] EWCA Civ 1089, [2002] 2 Lloyd’s Rep 436, [2002] 2 All ER (Comm) 768

Links:

Bailii

Jurisdiction:

England and Wales

Citing:

Cited – Latvian Shipping Company and Others v Stocznia Gdanska Sa CA 21-Jun-2002
A payment condition was just that and that a failure to pay entitled the seller to terminate at common law. Rix LJ said: ‘It is established law that, where one party to a contract has repudiated it, the other may validly accept that repudiation by . .
See Also – Stocznia Gdanska SA v Latreefers Inc; In re Latrefeers Inc; Stocznia Gdanska SA v Latvian Shipping Co and others (No 2) CA 15-Mar-2000
Possible claims against a foreign company for misfeasance, or wrongful or fraudulent trading might be sufficient to justify proceedings here to wind up a foreign registered company. A second requirement is that some person within this jurisdiction . .

Cited by:

See Also – Latvian Shipping Company and Others v Stocznia Gdanska Sa CA 21-Jun-2002
A payment condition was just that and that a failure to pay entitled the seller to terminate at common law. Rix LJ said: ‘It is established law that, where one party to a contract has repudiated it, the other may validly accept that repudiation by . .
Cited – Phones 4U Ltd v EE Ltd ComC 16-Jan-2018
The parties contracted for the marketing of contracts for the marketing of the defendant’s mobile phone contracts. On the claimant entering administration, the defendant exercised a clause in their contract to terminate the contract. The claimant . .
Lists of cited by and citing cases may be incomplete.

Insolvency, Torts – Other

Updated: 06 June 2022; Ref: scu.175205

Regina v Clive Louden Carass: CACD 19 Dec 2001

When a defendant was accused of an offence under the section, and wished to raise a defence under sub-section 4, the duty of proof placed on him by the sub-section amounted to a duty to bring sufficient evidence to raise the defence, and the section did not transfer the burden from the prosecution.
Held: To justify a transfer of the burden of proof, it had to be shown that this was required, and a persuasive burden rather than an evidential burden was not justified. There was no sufficient threat to society which required a higher burden. The words should be read to require the defendant to adduce sufficient evidence.

Judges:

Lord Justice Waller, Mr Justice Rougier and Mr Justice Stanley Burnton

Citations:

Times 21-Jan-2002, Gazette 27-Feb-2002, [2001] EWCA Crim 2845, [2002] 1 WLR 1214, [2002] 2 Cr App R 4

Links:

Bailii

Statutes:

Insolvency Act 1986 206 (1)(a)

Jurisdiction:

England and Wales

Citing:

Cited – Regina v Director of Public Prosecutions, ex parte Kebilene and others HL 28-Oct-1999
(Orse Kebeline) The DPP’s appeal succeeded. A decision by the DPP to authorise a prosecution could not be judicially reviewed unless dishonesty, bad faith, or some other exceptional circumstance could be shown. A suggestion that the offence for . .
Cited – Regina v Lambert HL 5-Jul-2001
Restraint on Interference with Burden of Proof
The defendant had been convicted for possessing drugs found on him in a bag when he was arrested. He denied knowing of them. He was convicted having failed to prove, on a balance of probabilities, that he had not known of the drugs. The case was . .

Cited by:

Distinguished – Regina v Daniel CACD 22-Mar-2002
The defendant appealed a conviction for hiding assets from her receiver following her bankruptcy. He said that recent case law suggested that the burden of establishing the defence under section 352 was evidential only.
Held: The conviction . .
Cited – Norwood v Director of Public Prosecutions Admn 3-Jul-2003
The appellant a BNP member had displayed a large poster in his bedroom window saying ‘Islam out of Britain’. He was convicted of an aggravated attempt to cause alarm or distress. The offence was established on proof of several matters, unless the . .
Wrongly Decided – Sheldrake v Director of Public Prosecutions; Attorney General’s Reference No 4 of 2002 HL 14-Oct-2004
Appeals were brought complaining as to the apparent reversal of the burden of proof in road traffic cases and in cases under the Terrorism Acts. Was a legal or an evidential burden placed on a defendant?
Held: Lord Bingham of Cornhill said: . .
Lists of cited by and citing cases may be incomplete.

Crime, Insolvency, Evidence

Updated: 05 June 2022; Ref: scu.167393

Kellar v BBR Graphic Engineers (Yorks) Ltd: ChD 2002

The court was asked whether the district judge had applied the right test on an application to set aside a statutory demand because the conclusions of the district judge referred to a real prospect of success, the test used in CPR 24.2, rather than the test of genuine triable issue.
Held: The debate as to whether there is a distinction between the ‘genuine triable issue’ test for cross-claims and ‘real prospect of succeeding on the claim’ (i.e. on the cross-claims) involves a sterile and largely verbal question. Roger Kaye QC noted that the Insolvency Rules did not use the test of real prospect of success, and said: ‘It seems to me therefore to have been plainly intended that what is generally thought to have been a lower threshold than is now applicable to applications and Part 24 of the Civil Procedure Rule is to continue to apply to applications to set aside a statutory demand. This is no doubt because of the serious consequences that a statutory demand which is not set aside must have. It almost invariably and inevitably leads to the presentation of a bankruptcy petition and a bankruptcy order if the statutory demand is not set aside.’

Judges:

Mr Roger Kaye QC

Citations:

[2002] BPIR 544, [2001] 1 All ER (D) 416

Jurisdiction:

England and Wales

Cited by:

Cited – Bryce Ashworth v Newnote Ltd CA 27-Jul-2007
The appellant challenged a refusal to set aside a statutory demand, in respect of his director’s loan account with the respondent company, saying the court should have accepted other accounts to set off against that debt.
Held: A statutory . .
Cited – Collier v P and M J Wright (Holdings) Ltd CA 14-Dec-2007
Agreement for payment by joint debtor not contract
The claimant appealed against refusal of an order to set aside a statutory demand. He said that he had compromised a claim by the creditors. He argued for an extension to the Rule in Pinnel’s case, so that where a debtor agrees to pay part of a . .
Lists of cited by and citing cases may be incomplete.

Insolvency

Updated: 05 June 2022; Ref: scu.258442

Morris v Banque Arab et Internationale D’Investissment SA (No 2): ChD 26 Oct 2000

For an order to be made under the section, and a contribution to the shortfall on insolvency made, it was necessary to show that the person against whom the order was sought had in some way participated in the fraudulent activity. It was not necessary to show that there had been any direct involvement in the management or carrying on of the business.

Citations:

Times 26-Oct-2000, Gazette 02-Nov-2000

Statutes:

Insolvency Act 1986 213 (2)

Jurisdiction:

England and Wales

Citing:

See Also – Morris v Banque Arab et Internationale d’Investissement ChD 2000
The parties had exchanged lists of documents but one side objected to inspection of a number of them on the ground that it would put them in breach of French law.
Held: There was discretion to be exercised. Neuberger J ordered inspection . .
Lists of cited by and citing cases may be incomplete.

Insolvency, Banking

Updated: 05 June 2022; Ref: scu.83853

Mirror Group Newspapers Plc v Maxwell and Others: ChD 30 May 2000

The settling of remuneration paid to a court-appointed receiver was not an assessment of costs in the Chancery Division, and the court fee normally payable for such an assessment did not apply.

Citations:

Times 30-May-2000, Gazette 08-Jun-2000

Jurisdiction:

England and Wales

Citing:

See Also – Mirror Group Newspapers Plc v Maxwell and Others (No 2) ChD 15-Jul-1997
The Court reminded insolvency practitioners of fiduciary duties to creditors when refusing application for further payment on account of costs. Ferris J considered the principles applicable to fixing the remuneration of receivers of the estate of . .
Lists of cited by and citing cases may be incomplete.

Insolvency, Costs

Updated: 05 June 2022; Ref: scu.83756

Mordant v Hallas: ChD 2 Aug 1993

A debt due which consisted of a matrimonial lump sum order is not provable in a bankruptcy.

Citations:

Gazette 02-Aug-1993

Jurisdiction:

England and Wales

Citing:

Appealed to – In re Mordant CA 1996
The court discussed the interplay of family and insolvency proceedings: ‘Since the wife is unable to prove in the husband’s bankruptcy, the position . . is that the husband’s trustee must use the andpound;385,000 in paying the trustee’s expenses . .

Cited by:

Appeal From – In re Mordant CA 1996
The court discussed the interplay of family and insolvency proceedings: ‘Since the wife is unable to prove in the husband’s bankruptcy, the position . . is that the husband’s trustee must use the andpound;385,000 in paying the trustee’s expenses . .
Lists of cited by and citing cases may be incomplete.

Insolvency, Family

Updated: 05 June 2022; Ref: scu.83826

National Westminster Bank plc v Jones and Others: CA 24 Oct 2001

The respondent farmers charged the farm by way of an agricultural floating charge to the claimants. On coming into difficulties, they set up a limited company and granted a tenancy in its favour and transferred assets to it. The bank obtained declarations that the charges remained valid and that the new tenancies and assignments should be set aside. The tenants appealed, but failed. The admitted purpose of the transactions was to put the assets beyond the reach of the bank, and that they were at an undervalue. The Agricultural Credits Act operated therefore to crystallise the charge. As to s423, it: ‘requires a comparison to be made between two figures. For that purpose the court must arrive at a conclusion based on actual values. The evidence may, of course, disclose a range of suggested figures. But the court must ascertain from the evidence the actual value against which the consideration for the transaction must be measured. That was the approach adopted by the judge. It is correct.’

Judges:

Judge LJ, Mummery LJ, Sir Martin Nourse

Citations:

Gazette 15-Nov-2001, Times 19-Nov-2001, [2001] EWCA Civ 1541, [2002] 1 BCLC 55

Links:

Bailii

Statutes:

Insolvency Act 1986 423, Agricultural Credits Act 1928 7

Jurisdiction:

England and Wales

Citing:

Appeal from – National Westminster Bank Plc v Jones and Others ChD 7-Jul-2000
A transaction could be deemed to be at an undervalue and caught by the section even though it made no difference to the overall assets and even though only one rather than the generality of creditors was prejudiced by the transaction. Here, by . .

Cited by:

Cited – Re Thoars (Dec’d); Reid v Ramlort Ltd ChD 2003
The company claimed the benefit of an insurance policy. They had paid certain premiums and the trustee had made a declaration that it was held on trust for the company. The insured died in Scotland, intestate and insolvent.
Held: The . .
Cited – Ramlort Ltd v Michael James Meston Reid CA 8-Jul-2004
The company sought to claim under a life policy. The deceased had died in Scotland insolvent. The trustee of the policy had declared that he held it on trust for the claimant, but the defendant, the judicial factor of the estate, said the . .
Cited – Feakins and Another v Department for Environment Food and Rural Affairs (Civ 1513) CA 9-Dec-2005
The department complained that the defendants had entered into a transaction with their farm at an undervalue so as to defeat its claim for recovery of sums due. The transaction used the grant of a tenancy by the first chargee.
Held: The . .
Lists of cited by and citing cases may be incomplete.

Banking, Agriculture, Insolvency

Updated: 04 June 2022; Ref: scu.166777

National Westminster Bank Plc v Jones and Others: ChD 7 Jul 2000

A transaction could be deemed to be at an undervalue and caught by the section even though it made no difference to the overall assets and even though only one rather than the generality of creditors was prejudiced by the transaction. Here, by creating a tenancy in favour of a limited company whose shares they also owned, they had not reduced their assets, but had prejudiced a chargee of the assets.

Citations:

Times 07-Jul-2000, Gazette 13-Jul-2000

Statutes:

Agricultural Credits Act 1928 7(1), Insolvency Act 1986 423

Jurisdiction:

England and Wales

Cited by:

Appeal from – National Westminster Bank plc v Jones and Others CA 24-Oct-2001
The respondent farmers charged the farm by way of an agricultural floating charge to the claimants. On coming into difficulties, they set up a limited company and granted a tenancy in its favour and transferred assets to it. The bank obtained . .
Lists of cited by and citing cases may be incomplete.

Insolvency

Updated: 04 June 2022; Ref: scu.84215

Shephard v Wheeler: ChD 15 Feb 2000

An administrator had obtained a grant in the estate of the deceased without disclosing that, although he claimed to be a Chartered Accountant, he had lost his membership, that he was a bankrupt and that the deceased had been a creditor in his bankruptcy. The extent of this wilful failure to disclose was such as to justify revocation of the grant. In the circumstances full disclosure was required. The fact that the bankruptcy was discoverable as a public fact by a search did not obviate the need for disclosure.

Citations:

Times 15-Feb-2000

Jurisdiction:

England and Wales

Wills and Probate, Insolvency

Updated: 04 June 2022; Ref: scu.89217

Mander v Evans: ChD 12 Jul 2001

The idea of fraudulent activity under the Act was confined to actual dishonesty of the defendant in line with Derry v Peek. It should not be extended to include acts which were only fraudulent under wider notions of equitable fraud. In this case assumed undue influence could not be sufficient to come within the section.

Citations:

Times 25-Jun-2001, Gazette 12-Jul-2001

Statutes:

Insolvency Act 1986 281(3)

Jurisdiction:

England and Wales

Insolvency

Updated: 04 June 2022; Ref: scu.83373

Times Newspapers Ltd v McNamara: ChD 13 Aug 2013

The claimant newspaper sought information as to the circumstances of the bankruptcy order made on the defendant, an Irish citizn said to have chosen the Eangland and Wales jurisdiction for his application.

Judges:

Baister Reg

Citations:

[2013] EWHC B12 (Ch), [2013] BPIR 1092

Links:

Bailii

Statutes:

Insolvency Rules 1986 7.31A(6)

Jurisdiction:

England and Wales

Insolvency

Updated: 03 June 2022; Ref: scu.569404

Pollard and Another v Ashurst: ChD 16 Mar 2000

Where a bankrupt was joint owner of property abroad but within the European Community, an English court could order the property to be sold and the proceeds paid to the trustee. Such an order could not be made against the land itself, but could be effective against the bankrupt in personam. The bankrupt and his wife could be ordered to sell the property at the best price reasonably obtainable, or to require the conveyance of the property to the trustee.

Citations:

Times 16-Mar-2000

Statutes:

Convention on Jurisdiction and the Enforcement of Judgments in Civil and Commercial Matters (1968) (Cmnd 7395), Insolvency Act 1986 436

Jurisdiction:

England and Wales

Insolvency, International, Land

Updated: 03 June 2022; Ref: scu.84787

Bailey and Another v Angove’s PTY Limited: ChD 2013

The liquidator of the company sought a declaration that sums received by the defendant sales agents on behalf of the insolvent company were to be paid out to the liquidators in full. The court was asked whether the payments by DWL and PLB made after the termination of the ADA were held on trust for Angove or were monies payable to DandD and therefore part of the estate of the insolvent company available for distribution amongst its general creditors.
Held: In the relevant respects the relationship between Angove’s and DandD was that of principal and agent only and not buyer and seller, and that DandD’s authority to collect the price from customers came to an end upon service of Angove’s termination notice.The only contract of sale for the wine that was ordered through DandD was between Angove and (in this case) DWL and PLB
Pelling QC said of the argument that that was insonsistent with the clause in the agreement: ’33. It was submitted on behalf of the Liquidators that because the effect of Clause 22(c) was to impose on the Company the obligation to pay the whole invoice sum due for the goods sold less commission in respect of which a credit note was to be issued for the benefit of the Company that necessarily negatives the true relationship between the Company and Angove being one of principal and agent. I am not able to accept that submission.
First, as I have said, the contract clearly distinguishes between those transactions in respect of which the Company is described as acting as agent and those where it is buying for its own account. It is only in respect of those transactions in respect of which the Company is described as acting as agent that commission is payable and to which the Clause 22 mechanism applies. Clearly therefore the parties considered that the transactions to which this mechanism applied were different from sales to the Company for its own account, which were expressly excluded from its application by Clause 21(a).
Secondly, I do not accept the premise of the submission – namely that because the Company undertakes a direct obligation to pay, that necessarily negatives the relationship being one of principal and agent in relation to transactions to which the mechanism applies. In Teheran – Europe Co. Ltd v. S.T. Belton (Tractors) Ltd [1968] 2 WLR 523, Donaldson J as he then was recognised at 528F that there were three ways in which an agent could conclude a contract on behalf of his principal, the second of which was by creating privity of contract between the third party, the principal and the agent. The outcome of that case was varied on appeal but there was no any disagreement by the Court of Appeal with this part of Donaldson J’s analysis. In the result, it does not follow that because an agent undertakes direct obligations owed to the principal therefore the relationship cannot be one of principal and agent.
I do not accept either the more restricted submission that because the obligation undertaken is one that involves accepting an obligation to pay for the goods that are being sold to the third party that necessarily prevents the relationship from being one of principal and agent. English law has long recognised the concept of a del credere agent – that is an agent who in consideration of a commission guarantees to his principal that third parties with whom he contracts on behalf of the principal will duly pay the sums due under those contracts.
As I have said the ADA must be read as a whole. So read, it applies specifically to at least two types of transaction. It applies primarily to sales to customers identified and introduced by the Company as agent for Angove (in respect of which commission is payable and the Clause 22 mechanism applies) and excepts from this mechanism sales to the Company for its own account. In relation to transactions falling within the last mentioned category the ADA imposes only the limited obligations I mentioned earlier.’

Judges:

Pelling QC HHJ

Citations:

[2013] EWHC 215 (Ch)

Statutes:

Insolvency Act 1986

Jurisdiction:

England and Wales

Cited by:

Appeal from – Bailey and Another v Angove’s Pty Ltd CA 7-Mar-2014
The parties disputed the payment out of sums held by the company’s liquidators under an undertaking given by them. Their case was that if DandD (agents for the insolvent company) acted in the relevant respects as agents, their authority to collect . .
At first instance – Bailey and Another v Angove’s Pty Ltd SC 27-Jul-2016
The defendant had agreed to act as the claimant’s agent and distributor of the claimant’s wines in the UK. It acted both as agent and also bought wines on its own account. When the defendant went into litigation the parties disputed the right of the . .
Lists of cited by and citing cases may be incomplete.

Insolvency, Agency

Updated: 02 June 2022; Ref: scu.568645

Japan Leasing (Europe) Plc v Shoa Leasing (Singapore) PTE Ltd: ChD 30 Jul 1999

The court considered a hire purchase agreement for an aircraft between four leasing companies and Olympic Airways. The contract documentation provided for the payment of the price in instalments to designated accounts in various currencies of one of the lessors, Japan Leasing. Japan Leasing was to receive the money on behalf of itself and the other three lessors. Japan Leasing went into administration, and a month later received an instalment into the designated accounts. The issue was whether that money was held in trust to pay their shares to the three other lessors.
Held: The court rejected the primary argument of the three solvent lessors that there was an express trust, but held that the last instalment was held on a constructive trust for the other lessors.

Judges:

Nicholas Warren QC

Citations:

[1999] BPIR 911, [2000] WTLR 301, [1998] EWHC 322 (Ch)

Links:

Bailii

Jurisdiction:

England and Wales

Cited by:

Wrongy decided – Bailey and Another v Angove’s Pty Ltd SC 27-Jul-2016
The defendant had agreed to act as the claimant’s agent and distributor of the claimant’s wines in the UK. It acted both as agent and also bought wines on its own account. When the defendant went into litigation the parties disputed the right of the . .
Lists of cited by and citing cases may be incomplete.

Insolvency, Trusts

Updated: 02 June 2022; Ref: scu.568651

Neste Oy v Lloyd’s Bank Plc: ChD 1983

A shipping agent (PSL), a client of the defendant, had become insolvent. The defendant sought to combine the accounts. PSL settled on behalf of their shipowner clients bills payable to harbour authorities, pilots, fuel merchants, and other providers of goods and services. The shipowners sometimes put them in funds in advance and sometimes reimbursed them in arrears. The plaintiff shipowners claimed that the unspent balance of six payments made by them to a general account of PSL were held for them in trust. Their primary case was that the payments were subject to an implied trust to pay the money to the suppliers. This arose either by virtue of the agency relationship or as a special purpose (or Quistclose) trust.
Held: The argument was rejected. However, there was a constructive trust of the sixth payment, which had been received after the directors of PSL had concluded that their company was insolvent.
Bingham J approved as ‘in accord with the general principles of equity as applied in England’: ‘the receiving of money which consistently with conscience cannot be retained is, in equity, sufficient to raise a trust in favour of the party for whom or on whose account it was received. This is the governing principle in all such cases. And therefore, whenever any controversy arises, the true question is, not whether money has been received by a party of which he could not have compelled the payment, but whether he can now, with a safe conscience, ex aequo et bono, retain it.’ from Story’s Commentaries on Equity Jurisprudence, 2nd ed.
He applied this to the facts of the case saying: ‘Given the situation of PSL when the last payment was received, any reasonable and honest directors of that company (or the actual directors had they known of it) would, I feel sure, have arranged for the repayment of that sum to the plaintiff’s without hesitation or delay. It would have seemed little short of sharp practice for PSL to take any benefit from the payment, and it would have seemed contrary to any ordinary notion of fairness that the general body of creditors should profit from the accident of a payment made at a time when there was bound to be a total failure of consideration. Of course it is true that insolvency always causes loss and perfect fairness is unattainable. The bank, and other creditors, have their legitimate claims. It nonetheless seems to me that at the time of its receipt PSL could not in good conscience retain this payment and that accordingly a constructive trust is to be inferred.’

Judges:

Bingham J

Citations:

[1983] 2 Lloyds Rep 658

Jurisdiction:

England and Wales

Citing:

Cited – Barclays Bank Ltd v Quistclose Investments Ltd; etc HL 31-Oct-1968
R Ltd were in serious financial difficulties. The company’s overdraft with the appellant bank was almost twice its permitted limit. The company sought a loan of 1 million pounds from a financier, who was willing to lend the company that sum provided . .

Cited by:

Not justified – Bailey and Another v Angove’s Pty Ltd SC 27-Jul-2016
The defendant had agreed to act as the claimant’s agent and distributor of the claimant’s wines in the UK. It acted both as agent and also bought wines on its own account. When the defendant went into litigation the parties disputed the right of the . .
Lists of cited by and citing cases may be incomplete.

Insolvency, Agency, Banking

Updated: 02 June 2022; Ref: scu.568652

Re a Debtor (No 222 of 1990) ex parte the Bank of Ireland: ChD 1992

Harman J discussed the rules of a creditors’ meeting: ‘In my judgment the scheme of the meeting rules in r 5.17 is quite plainly a simple one. As one would expect the meeting is not the place to go into lengthy debates as to the exact status of a debt, nor is it the time to consider such matters as this court, sitting as the Companies Court, frequently has to consider as such whether a debt is bona fide disputed upon substantial grounds, an issue which leads to a great deal of litigation and frequently takes a day or so to decide. None of that could possibly be a suitable process to be embarked upon at a creditors’ meeting.
The scheme is quite clear. The chairman has power to admit or reject; his decision is subject to appeal; and if in doubt he shall mark the vote as objected to and allow the creditor to vote. That is easily carried out upon the basis advanced by Mr Moss QC, Mr Mann and Mr Trace. It provides a simple clear rule for the chairman, not a lawyer, faced at a large meeting with speedy decisions necessary to be made to enable the meeting to reach a decision. On that basis the chairman must look at the claim; if it is plain or obvious that it is good he admits it, if it is plain or obvious that it is bad he rejects it, if there is a question, a doubt, he shall admit it but mark it as objected.’

Judges:

Harman J

Citations:

[1992] BCLC 137

Jurisdiction:

England and Wales

Cited by:

Cited – AB Agri Ltd v Curtis and Others Misc 22-Jul-2016
(Leeds County Court) The creditor sought to have a proof admitted for pounds 479k, but the chair admitted it only for pounds 1.00, and the IVA proposal was accepted again the wishes of the creditor. The creditor said that the IP had misunderstood . .
Lists of cited by and citing cases may be incomplete.

Insolvency

Updated: 02 June 2022; Ref: scu.567379

Re The People’s Restaurant Group Ltd: ChD 30 Nov 2012

Petition praying for (amongst other relief):
1.1 The restoration of The People’s Restaurant Group Limited (‘the Company’) to the Register of Companies.
1.2 Its winding-up to take effect retrospectively from 24 June 2010.
1.3 The suspension of any limitation period between the date of its dissolution and the date of determination of the Petition for any causes of action the Company or its liquidator may have.’

Judges:

Mr Registrar Jones

Citations:

[2012] EWHC B33 (Ch)

Links:

Bailii

Statutes:

Companies Act 1986, Insolvency Act 1986

Jurisdiction:

England and Wales

Insolvency, Company

Updated: 02 June 2022; Ref: scu.569051

Soden and Another v British and Commonwealth Holdings Plc and others: HL 16 Oct 1997

A court assessing the claims of members in a liquidation should distinguish between claims made qua members and others. Sums due to a member of company ranked as such if cause of action based on the statutory contract between company and members

Citations:

Gazette 29-Oct-1997, Times 22-Oct-1997, Gazette 14-Jan-1998, [1997] UKHL 41; [1998] AC 298; [1997] 4 All ER 353; [1997] 3 WLR 840

Links:

House of Lords, Bailii

Statutes:

Companies Act 1985 14(1)

Jurisdiction:

England and Wales

Insolvency

Updated: 31 May 2022; Ref: scu.158916

Commissioners of Inland Revenue v Kahn and Another: CA 23 Mar 2000

Appeal against an order of Mr Justice Evans-Lombe on an application made pursuant to section 112(1) of the Insolvency Act 1986 by the joint liquidators of Toshoku Finance UK Plc (‘the Company’) for directions in relation to the discharge of an alleged liability to corporation tax on interest receivable after the commencement of the winding up.

Citations:

[2000] EWCA Civ 86

Links:

Bailii

Statutes:

Insolvency Act 1986 112(1)

Jurisdiction:

England and Wales

Corporation Tax, Insolvency

Updated: 31 May 2022; Ref: scu.147119

Mond v Hyde and Another: CA 16 Jul 1998

The Court was asked whether an Official Receiver in Bankruptcy is, on grounds of public policy, immune from an action for damages at the suit of the trustee who has suffered financial loss by relying upon a negligent statement made to him by the Official Receiver in the course of the bankruptcy proceedings.

Judges:

Beldam, Aldous, Ward LJJ

Citations:

[1998] 3 All ER 833, [1998] EWCA Civ 1226

Links:

Bailii

Jurisdiction:

England and Wales

Insolvency, Negligence

Updated: 30 May 2022; Ref: scu.144705

Polly Peck International Plc v The Marangos Hotel Company Ltd and Others: CA 7 May 1998

Leave had been given for the insolvent plaintiff company to bring proceedings. The defendant now challenged that leave.
Held: A claim that a massively insolvent company had wrongfully occupied Turkish Cypriot property would not allow a claim of remedial constructive trust against assets held by liquidator here. A so-called ‘remedial constructive trust’ is not known in English law. Mummery LJ pointed to the lack of any material distinction between compulsory winding up and administration.

Judges:

Nourse LJ, Potter LJ, Mummery LJ

Citations:

Times 18-May-1998, [1998] EWCA Civ 789, [1998] 3 All ER 812, [1998] 2 BCLC 185

Links:

Bailii

Statutes:

Insolvency Act 1986 11(3)

Jurisdiction:

England and Wales

Cited by:

Cited – Ultraframe (UK) Ltd v Fielding and others ChD 27-Jul-2005
The parties had engaged in a bitter 95 day trial in which allegations of forgery, theft, false accounting, blackmail and arson. A company owning patents and other rights had become insolvent, and the real concern was the destination and ownership of . .
Cited – Harms Offshore AHT Taurus Gmbh and Co KG v Bloom and Others CA 26-Jun-2009
The court had granted to the liquidators of a company a mandatory injunction requiring the appellant German companies to attempt to obtain the release of assets from attachment by the court in new York.
Held: The appeal was dismissed. The . .
Lists of cited by and citing cases may be incomplete.

Trusts, Insolvency

Updated: 30 May 2022; Ref: scu.144267

Quickson (South and West) Limited v Stephen Mark Katz, John Stephen Kelmanson (As Joint Liquidators of Buildlead Limited): ChD 25 Aug 2004

Various applications were made in the insolvency, including for removal of the liquidators and declarations that certain payments were a fraudulent preference on the creditors.
Held: No prejudice had been shown by any procedural irregularity. Other creditors should be able to see that there is a proper investigation of relevant matters relating to inter-company transfers, and the matter should be allowed to proceed. The liquidators had acted in a surprising way in a tactical battle with the applicants, whose loss of confidence in the liquidators was understandable. Proceedings for disqualification orders had been discontinued, but the liquidators persisted in their assertion of an unlawful preference. The costs unreasonably incurred by the liquidators had swallowed all the assets. The liquidators should be removed.

Judges:

Etherton, The Honourable Mr Justice Etherton

Citations:

[2004] EWHC 2443 (Ch)

Links:

Bailii

Jurisdiction:

England and Wales

Citing:

Cited – In re Keypak Homecare Ltd ChD 1987
The court considered an application under section 108 to remove the liquidator, and reviewed the case law on the topic: ‘The section authorises the court to remove the liquidator ‘on cause shown’. That is not the same as saying ‘if the court shall . .
Cited – Buchler and another (as joint liquidators of Leyland DAF Limited) v Talbot and another (as joint administrative receivers of Leyland DAF Limited) and Stichting Ofasec and others HL 4-Mar-2004
The liquidator sought to recover his expenses from assets charged under a floating charge in priority to the chargee.
Held: Barleycorn was decided in error. The liquidators costs incurred in an insolvent winding up were not to be charged . .
Cited – Siebe Gorman and Co Ltd v Barclays Bank Ltd ChD 1979
It was possible to create a fixed charge over present and future book debts and on its true construction, the debenture granted to Barclays Bank Ltd in this case had done so. If the chargor of book debts, having collected the book debts, ‘[had] had . .
Cited – National Westminster Bank Plc v Spectrum Plus Ltd; In re Spectrum Plus CA 26-May-2004
The court was asked whether a charge given over book debts in a debenture was floating or fixed.
Held: Since the charge asserted some control over receipt of the payments, it was a fixed charge. Upon payment into the account, title to the . .
Cited – Agnew and Kevin James Bearsley v The Commissioner of Inland Revenue, and Official Assignee for the Estate In Bankruptcy of Bruce William Birtwhistle and Mark Leslie Birtwhistle PC 5-Jun-2001
(New Zealand) A charge had been given by a company over its book debts. The charge was expressed to create a fixed charge over debts uncollected when a receiver was appointed, so that on collection they became payable to the bank. Until the receiver . .
Cited – In re Brightlife Ltd ChD 1987
Parties contractual freedom to be respected
A clause in a debenture gave a charge which provided that the chargor should not: ‘deal with its book or other debts or securities for money otherwise than in the ordinary course of getting in and realising the same which expression shall not . .
Cited – In Re Keenan Bros Ltd 1986
(Supreme Court of the Republic of Ireland) A debenture conferred a fixed charge on book debts. It specifically provided that withdrawals from the account to which the proceeds of the book debts had to be credited might only be made with the prior . .
Cited – Re Ledingham-Smith ChD 1993
The bankrupt’s accountants had been paid their fees by standing order. Arrears mounted and the sum was increased. On the bankruptcy, the trustee sought to recover the increased payment. The court considered whether they had been given a preference. . .
Cited – Farah and Others v Home Office, British Airways Plc and Another CA 6-Dec-1999
The applicants claimed in negligence against the Home Office after its advisers had wrongly advised the first defendants that the claimants’ travel documents were not valid. The claim was struck out, and the claimants appealed. The strike out was . .
Cited – Re Continental Assurance Co of London plc (No.2) 1988
Directors of a company in creditors’ voluntary liquidation sought to strike out an application by the liquidators seeking relief against them for wrongful trading and breach of fiduciary duty. They asserted that the liquidators’ application was . .
Cited – Re Bullard and Taplin Ltd ChD 1996
Tne question of whether there was at any time ‘pending court proceedings’ was answered by asking if there existed a court file. The section empowered a court itself to appoint another trustee in bankruptcy. Section 41 of the 1984 Act could be used . .
Cited – Marseilles Extension Rly and Land Co 1867
The court considered the circumstances when a liquidator could be removed. The words ‘due cause’ did not require anything amounting to misconduct or personal unfitness. It was sufficient if it could be shown that it was on the whole desirable that a . .
Approved – Re Adam Eyton Ltd CA 7-Jul-1887
In considering the removal of a liquidator, the court referred to the John Moore Gold case: ‘In my opinion, although of course unfitness discovered in a particular person would be a ground for removing him, yet the power of removal is not confined . .
Cited – Re Sir John Moore Gold Mining Co CA 1879
The court considered an appeal against an order removing the liquidator: ‘I should say that, as a general rule, [the words ‘on cause shown’] point to some unfitness of the person – it may be from personal character, or from his connection with other . .
Cited – Shepheard v Lamey ChD 2001
An application was made for the removal of a liquidator: ‘After all, all that one has to find is some good cause why a person should not continue as a liquidator. You do not have to prove everything in sight; you do not have to prove, for example, . .
Cited – In Re Edennote Ltd; Tottenham Hotspur plc v Ryman CA 21-May-1996
The company was in liquidation. Terence Venables, who had owned the shares, had taken an assignment of a cause of action against the football club. The court had set aside that assignment, and removed the liquidator. Venables now appealed saying . .
Cited – AMP Enterprises Ltd v Hoffman and Another ChD 25-Jul-2002
A creditor sought an order to replace the company liquidator.
Held: Such orders were discretionary, but courts should not grant them too readily. It was for the applicant to show good reason for the order. The circumstances would vary widely, . .
Lists of cited by and citing cases may be incomplete.

Insolvency

Updated: 29 May 2022; Ref: scu.200507

Kornhaas v Thomas Dithmar: ECJ 10 Dec 2015

ECJ (Judgment) Reference for a preliminary ruling – Area of freedom, security and justice – Insolvency proceedings – Regulation (EC) No 1346/2000 -Article 4(1) – Determination of the applicable law – Legislation of a Member State laying down the obligation for a managing director of a company to reimburse that company for the payments made after it had become insolvent – Application of that legislation to a company established in another Member State – Articles 49 TFEU and 54 TFEU – Restriction on the freedom of establishment – None

Citations:

ECLI:EU:C:2015:806, [2015] EUECJ C-594/14

Links:

Bailii

Jurisdiction:

European

Insolvency

Updated: 23 May 2022; Ref: scu.557015

in re Pergamon Press Ltd: CA 1971

The court was asked as to the duties of inspectors appointed under the 1948 Act. Sachs LJ said: ‘The inspectors’ function is in essence to conduct an investigation designed to discover whether there are facts which may result in others taking action; it is no part of their function to take a decision as to whether action be taken and a fortiori it is not for them finally to determine such issues as may emerge if some action eventuates.’
Lord Denning MR set out the following statement of principle: ‘The inspectors can obtain information in any way they think best, but before they condemn or criticise a man, they must give him a fair opportunity for correcting or contradicting what is said against him. They need not quote chapter and verse. An outline of the charge will usually suffice.’
and ‘They have to make a report which may have wide repercussions. They may, if they think fit, make findings of fact which are very damaging to those whom they name. They may accuse some; they may condemn others; they may ruin reputations or careers. Their report may lead to judicial proceedings . . When they do make their report, the Board are bound to send a copy of it to the company; and the board may, in their discretion, publish it, if they think fit, to the public at large.
Seeing that their work and their report may lead to such consequences, I am clearly of the opinion that the inspectors must act fairly . . before they condemn or criticise a man, they must give him a fair opportunity for correcting or contradicting what is said against him.’

Judges:

Lord Denning MR

Citations:

[1971] Ch 388, [1970] 3 WLR 792, [1970] 3 All ER 535

Statutes:

Companies Act 1948

Jurisdiction:

England and Wales

Cited by:

Cited – Saunders v The United Kingdom ECHR 17-Dec-1996
(Grand Chamber) The subsequent use against a defendant in a prosecution, of evidence which had been obtained under compulsion in company insolvency procedures was a convention breach of Art 6. Although not specifically mentioned in Article 6 of the . .
Cited – Financial Conduct Authority v Macris SC 22-Mar-2017
The claimant had complained that the appellant Authority had made public a penalty imposed on a former employer but implicating him without he being first given an opportunity to make representations. . .
Cited – Lewin, Regina (on The Application of) v The Financial Reporting Council Ltd and Others Admn 19-Mar-2018
. .
Cited – UK Innovative TI Ltd and Another v The Financial Conduct Authority UTTC 25-Apr-2018
FINANCIAL SERVICES – procedure – applicants contending they have third party rights in relation to a Supervisory Notice – whether Tribunal has jurisdiction in relation to the subject matter of the references-no-references struck out – Rule 8 (2) (a) . .
Lists of cited by and citing cases may be incomplete.

Insolvency, Company

Updated: 20 May 2022; Ref: scu.622608

Re Esal (Commodities) Ltd (No 2): CA 2 Jan 1990

the principal purpose of the powers to compel third parties to provide material to office-holders under sections 235, 236 and 366 is to assist with the beneficial winding up of the company or bankruptcy of the individual in question

Judges:

Dillon LJ

Citations:

[1990] BCC 708

Jurisdiction:

England and Wales

Citing:

See Also – Re Esal (Commodities) Ltd CA 30-May-1988
The respondents were the liquidators of a company which the appellant bank climbed old substantial monies. The insolvent company had several subsidiaries and sub-subsidiaries, holding further assets. The respondent first sought an order requiring . .
See Also – In Re Esal (Commodities) Ltd CA 1989
. .
At ChD – Re Esal (Commodities) Ltd (No 2) ChD 1990
The company was wound up massively insolvent. The liquidators obtained orders for the private examination of an officer of the bank, who had undertaken an investigation into the bank’s relationship with the company before it’s liquidation. The bank . .
Lists of cited by and citing cases may be incomplete.

Insolvency

Updated: 20 May 2022; Ref: scu.622384

Re Esal (Commodities) Ltd: CA 30 May 1988

The respondents were the liquidators of a company which the appellant bank climbed old substantial monies. The insolvent company had several subsidiaries and sub-subsidiaries, holding further assets. The respondent first sought an order requiring the production of certain documents to assist with the liquidation. Those orders were discharged after compromise agreements. The respondent then sought yet further disclosures, and the court made an order in very wide terms which would permit disclosure of any documents thought reasonably beneficial to the winding up, and those subsidiary or sub-subsidiary companies might in turn also disclose them if required to do so in other legal proceedings. The appellant now said that the order was too wide.
Held: The appeal failed. The wide power of disclosure was necessary to avoid the court becoming bogged down in the minutiae of constant squabbles over the relevance of particular documents.

Citations:

[1989] BCLC 59, Times 30-May-1988, 1988 PCC 443

Statutes:

Companies Act 1985 561

Jurisdiction:

England and Wales

Cited by:

See Also – In Re Esal (Commodities) Ltd CA 1989
. .
See Also – Re Esal (Commodities) Ltd (No 2) ChD 1990
The company was wound up massively insolvent. The liquidators obtained orders for the private examination of an officer of the bank, who had undertaken an investigation into the bank’s relationship with the company before it’s liquidation. The bank . .
See Also – Re Esal (Commodities) Ltd (No 2) CA 2-Jan-1990
the principal purpose of the powers to compel third parties to provide material to office-holders under sections 235, 236 and 366 is to assist with the beneficial winding up of the company or bankruptcy of the individual in question . .
Lists of cited by and citing cases may be incomplete.

Company, Insolvency

Updated: 20 May 2022; Ref: scu.622389

Re Esal (Commodities) Ltd (No 2): ChD 1990

The company was wound up massively insolvent. The liquidators obtained orders for the private examination of an officer of the bank, who had undertaken an investigation into the bank’s relationship with the company before it’s liquidation. The bank and liquidators agreed to terms upon which information would be provided to the liquidators, a term of which was that documents disclosed by the bank would be used only for the liquidation without the leave of the court. A member of the committee of inspection issued proceedings against the back for fraudulent trading by E in which the banker had participated. He sought permission to use the information disclosed in the liquidation in the action against the bank.
Held: The information could be used. Information obtained under a threat based upon section 268 should be used only for the purposes of the liquidation unless there were exceptional circumstances. Here the subject matter and the claim were closely associated with to the liquidation and the allegations were of a serious nature.

Judges:

Millett J

Citations:

[1990] BCC 125

Statutes:

Companies Act 1984 268

Jurisdiction:

England and Wales

Citing:

See Also – Re Esal (Commodities) Ltd CA 30-May-1988
The respondents were the liquidators of a company which the appellant bank climbed old substantial monies. The insolvent company had several subsidiaries and sub-subsidiaries, holding further assets. The respondent first sought an order requiring . .
See Also – In Re Esal (Commodities) Ltd CA 1989
. .

Cited by:

At ChD – Re Esal (Commodities) Ltd (No 2) CA 2-Jan-1990
the principal purpose of the powers to compel third parties to provide material to office-holders under sections 235, 236 and 366 is to assist with the beneficial winding up of the company or bankruptcy of the individual in question . .
Lists of cited by and citing cases may be incomplete.

Insolvency

Updated: 20 May 2022; Ref: scu.622385

In Re Esal (Commodities) Ltd: CA 1989

Citations:

[1989] BCLC 59

Jurisdiction:

England and Wales

Citing:

Approved – In Re Rolls Razor Ltd ChD 1968
Buckley J said: ‘The powers conferred by section 268 are powers directed to enabling the court to help a liquidator discover the truth of the circumstances connected with the affairs of the company, information of trading, dealings, and so forth, in . .
See Also – Re Esal (Commodities) Ltd CA 30-May-1988
The respondents were the liquidators of a company which the appellant bank climbed old substantial monies. The insolvent company had several subsidiaries and sub-subsidiaries, holding further assets. The respondent first sought an order requiring . .

Cited by:

See Also – Re Esal (Commodities) Ltd (No 2) ChD 1990
The company was wound up massively insolvent. The liquidators obtained orders for the private examination of an officer of the bank, who had undertaken an investigation into the bank’s relationship with the company before it’s liquidation. The bank . .
See Also – Re Esal (Commodities) Ltd (No 2) CA 2-Jan-1990
the principal purpose of the powers to compel third parties to provide material to office-holders under sections 235, 236 and 366 is to assist with the beneficial winding up of the company or bankruptcy of the individual in question . .
Lists of cited by and citing cases may be incomplete.

Insolvency

Updated: 20 May 2022; Ref: scu.622388

n re Rolls Razor Ltd. (No. 2): ChD 1970

Megarry J said: ‘The process under section 268 is needed because of the difficulty in which the liquidator in an insolvent company is necessarily placed. He usually comes as a stranger to the affairs of a company which has sunk to its financial doom. In that process, it may well be that some of those concerned in the management of the company, and others as well, have been guilty of some misconduct or impropriety which is of relevance to the liquidation. Even those who are wholly innocent of any wrongdoing may have motives for concealing what was done. In any case, there are almost certain to be many transactions which are difficult to discover or to understand merely from the books and papers of the company. Accordingly, the legislature has provided this extraordinary process so as to enable the requisite information to be obtained. The examinees are not in any ordinary sense witnesses, and the ordinary standards of procedure do not apply. There is here an extraordinary and secret mode of obtaining information necessary for the proper conduct of the winding up. The process, borrowed from the law of bankruptcy, can only be described as being sui generis.’

Judges:

Megarry J

Citations:

[1970] Ch. 576

Jurisdiction:

England and Wales

Citing:

See Also – In Re Rolls Razor Ltd ChD 1968
Buckley J said: ‘The powers conferred by section 268 are powers directed to enabling the court to help a liquidator discover the truth of the circumstances connected with the affairs of the company, information of trading, dealings, and so forth, in . .
Lists of cited by and citing cases may be incomplete.

Insolvency

Updated: 20 May 2022; Ref: scu.622387

National Westminster Bank Plc v Spectrum Plus Ltd and Others; In re Spectrum Plus Ltd (in liquidation): CA 12 Jul 2004

The High Court or the Court of Appeal should not follow a decision of the Privy Council in place of a decision of the House of Lords, unless the circumstances are quite exceptional and the court is satisfied that in practice the result would be a foregone conclusion

Judges:

Lord Phillips of Worth Matravers MR, Jonathan Parker, Jacob LJJ

Citations:

[2004] EWCA Civ 670, [2004] 3 WLR 503, [2004] Ch 337

Links:

Bailii

Statutes:

Insolvency Act 1986 112

Jurisdiction:

England and Wales

Cited by:

Cited – Willers v Gubay ChD 15-May-2015
The court was asked whether the tort of malicious prosecution of civil proceedings is known to English law.
Held: The Crawfod Adjusters case should not be followed: ‘If I am not bound by Gregory, then I see no reason for departing from the . .
Lists of cited by and citing cases may be incomplete.

Constitutional, Insolvency

Updated: 20 May 2022; Ref: scu.622344

In Re Rolls Razor Ltd: ChD 1968

Buckley J said: ‘The powers conferred by section 268 are powers directed to enabling the court to help a liquidator discover the truth of the circumstances connected with the affairs of the company, information of trading, dealings, and so forth, in order that the liquidator may be able, as effectively as possible and, I think, with as little expense as possible and with as much expedition as possible, to complete his function as liquidator, to put the affairs of the company in order and to carry out the liquidation in all of its various aspects, including, of course, the getting in of any assets of the company available in the liquidation. It is, therefore, appropriate for the liquidator, when he thinks that he may be under a duty to try to recover something from some officer or employee of a company, or some other person who is, in some way, concerned with the company’s affairs, to be able to discover, with as little expense as possible and with as much ease as possible, the facts surrounding any such possible claim.’

Judges:

Buckley J

Citations:

[1968] 3 All ER 698, [1970] Ch 576

Jurisdiction:

England and Wales

Cited by:

See Also – n re Rolls Razor Ltd. (No. 2) ChD 1970
Megarry J said: ‘The process under section 268 is needed because of the difficulty in which the liquidator in an insolvent company is necessarily placed. He usually comes as a stranger to the affairs of a company which has sunk to its financial . .
Approved – In Re Esal (Commodities) Ltd CA 1989
. .
Lists of cited by and citing cases may be incomplete.

Insolvency

Updated: 20 May 2022; Ref: scu.622386

Stocznia Gdanska SA v Latvian Shipping Company and Others: ComC 25 May 2001

When a claimant commenced litigating several issues, but succeeded only on some of the them, the rule allowing an award of costs to the generally successful party was not dependent upon questions of whether the party was reasonable to have raised them. The reasonableness of pursuing a point was not necessarily relevant. The sub-paragraph was distinct from other allowing issues as to the conduct of the parties. One purpose of the rules was to persuade parties to reduce the number of claims they made to encourage a reduction in the costs of litigation.

Judges:

Thomas J

Citations:

Times 25-May-2001, [2001] EWHC 500 (Comm)

Links:

Bailii

Statutes:

Civil Procedure Rules 44.3(2)

Jurisdiction:

England and Wales

Citing:

See Also – Stocznia Gdanska SA v Latreefers Inc; In re Latrefeers Inc; Stocznia Gdanska SA v Latvian Shipping Co and others (No 2) CA 15-Mar-2000
Possible claims against a foreign company for misfeasance, or wrongful or fraudulent trading might be sufficient to justify proceedings here to wind up a foreign registered company. A second requirement is that some person within this jurisdiction . .
Cited – PLG Research Ltd and Another v Ardon International Ltd and Others ChD 25-Nov-1994
A patent infingement claim was met by the assertion that the material covered had been disclosed before the patent had been obtained. The court was asked as to the test of whether the information in a claim had been disclosed. Aldous J said: ‘Mr. . .

Cited by:

Appeal from – Latvian Shipping Company and Others v Stocznia Gdanska Sa CA 21-Jun-2002
A payment condition was just that and that a failure to pay entitled the seller to terminate at common law. Rix LJ said: ‘It is established law that, where one party to a contract has repudiated it, the other may validly accept that repudiation by . .
See Also – Stocznia Gdanska SA v Latreefers Inc; In re Latrefeers Inc; Stocznia Gdanska SA v Latvian Shipping Co and others (No 2) CA 15-Mar-2000
Possible claims against a foreign company for misfeasance, or wrongful or fraudulent trading might be sufficient to justify proceedings here to wind up a foreign registered company. A second requirement is that some person within this jurisdiction . .
Lists of cited by and citing cases may be incomplete.

Costs, Insolvency

Updated: 20 May 2022; Ref: scu.89570

Stein v Blake: CA 13 May 1993

The plaintiff argued that: ‘Nothing in the wording of section 323 changes the nature of set-off as it operates between solvent parties; it merely widens the categories of claim capable of being, and which must be, set off.’
Held: The decision in Farley was wrong and that the separate causes of action survived the bankruptcy and could be assigned, subject to the ‘equity’ of the bankruptcy set-off.

Judges:

Balcombe LJ

Citations:

Times 13-May-1993, [1994] Ch 16

Statutes:

Insolvency Act 1986 323f

Jurisdiction:

England and Wales

Cited by:

Appeal from – Stein v Blake HL 18-May-1995
Where A and B each have claims against each other and A is insolvent, the common amount is set off, and the net difference remains as a debt due.
Hoffmann L said: ‘It is a matter of common occurrence for an individual to become insolvent while . .
See Also – Stein v Blake and others CA 13-Oct-1997
The defendants challenged leave to appeal given to the plaintiff against dismissal of his claim following the Prudential Assurance case.
Held: The issue was whether the plaintiff can recover the loss which he has allegedly sustained by reason . .
See Also – Stein v Blake and others CA 13-Oct-1997
The defendants challenged leave to appeal given to the plaintiff against dismissal of his claim following the Prudential Assurance case.
Held: The issue was whether the plaintiff can recover the loss which he has allegedly sustained by reason . .
See Also – Stein v Blake ChD 31-Oct-2000
When a Legal Aid certificate was withdrawn, leading to an opposing party suffering abortive costs in continuing the action, it was not a duty of the Legal Services Commission to inform the opposing side. They would have no access to arrangements . .
Lists of cited by and citing cases may be incomplete.

Insolvency

Updated: 20 May 2022; Ref: scu.89539

Henderson CA (the Liquidator of Letham Grange Development Co Ltd) v 3052772 Nova Scotia Limited: OHCS 9 Dec 2003

Judges:

Lord Carloway

Citations:

[2003] ScotCS 304

Links:

Bailii

Statutes:

Insolvency Act 1986 242

Jurisdiction:

Scotland

Cited by:

See Also – Mathew Purdon Henderson ( Liquidator of Letham Grange Development Co Ltd) v 3052775 Nova Scotia Ltd OHCS 21-Apr-2004
. .
See Also – Henderson v 3052775 Nova Scotia Limited IHCS 18-Feb-2005
. .
See Also – Henderson v 3052775 Nova Scotia Ltd HL 10-May-2006
The liquidator had sought to set aside a transfer of company property as having been made at an undervalue. The defence was that the buyer had assumed some of the company’s debt in addition, and in effect that it was a preference on other creditors. . .
Lists of cited by and citing cases may be incomplete.

Insolvency

Updated: 19 May 2022; Ref: scu.190761

Regina v Kansal: CACD 24 Jun 1992

K had been convicted of two counts of obtaining property by deception contrary to section 15 of the Theft Act 1968. He was also convicted of two counts under the Insolvency Act 1986, namely that being a bankrupt (a) he removed property which he was required to deliver up to the Official Receiver or his trustee, contrary to section 354(2); and (b) he failed without reasonable excuse to account for the loss of a substantial part of his property or to give a satisfactory explanation of the manner of the loss, contrary to section 354(3). Large sums were involved-he obtained from the Halifax Building Society pounds 150,000 and pounds 116,250 on a false representation as to his income and that he was not bankrupt and that he did not have any judgment or proceedings for debt outstanding. Prior to these advances he was adjudged bankrupt. His wife later collected from his solicitor pounds 104,000 in cash, part of the monies advanced by the Building Society, and took it in a bin liner to India.. 2. At his trial in 1992 the prosecution, using section 433 of the 1986 Act brought evidence of answers given by him under compulsion in his bankruptcy proceedings and the trial judge ruled that these answers were not rendered inadmissible by virtue of section 31 of the Theft Act 1968 but were admissible under section 433.
Held: His appeal failed. There was no bar on a prosecution based upon evidence in the form of admissions which had been provided involuntarily under the Insolvency Act in public hearings in later Theft Act cases. The written record could be used in any later proceedings.
The Insolvency Act 1986 and its Rules not only permitted the examination of the bankrupt to take place but rendered any statement made in the course of that examination admissible in any trial. In those circumstances, with specific legislation directed to this issue, the protection provided under section 31 of the Theft Act 1968 was inapplicable:
‘The privilege from self-incrimination is abrogated in bankruptcy proceedings not by the opening words of section 31 of the Theft Act 1968, but by rule 6.175 of the Insolvency Rules 1986 made pursuant to section 412 of the act of 1986:
‘(1) The bankrupt shall at the hearing be examined on oath; and he shall answer all questions as the court may put, or allow to be put, to him . . (5) The written record may, in any proceedings (whether under the Act or otherwise) be used as evidence against the bankrupt of any statement made by him in the course of his public examination.’
Thereafter section 433 of the Act of 1986 renders the evidence admissible.’

Citations:

Gazette 24-Jun-1992, Gazette 15-Jul-1992, [1992] 3 All ER 844, [1993] QB 244

Statutes:

Theft Act 1968 31, Insolvency Act 1986 433, Insolvency Rules 1986 6.175

Jurisdiction:

England and Wales

Cited by:

Cited – Clingham (formerly C (a minor)) v Royal Borough of Kensington and Chelsea; Regina v Crown Court at Manchester Ex parte McCann and Others HL 17-Oct-2002
The applicants had been made subject of anti-social behaviour orders. They challenged the basis upon which the orders had been made.
Held: The orders had no identifiable consequences which would make the process a criminal one. Civil standards . .
See Also – Regina v Kansal, on a Reference From the Criminal Cases Review Commission (2) CACD 24-May-2001
Once a case had been referred to the Court of Appeal by the Criminal Cases Review Commission, the court had to make a declaration, even if the case was very old. The effect of the 1998 Act on statute law was not retrospective, but where it affected . .
See Also – Regina v Kansal (2) HL 29-Nov-2001
The prosecutor had lead and relied at trial on evidence obtained by compulsory questioning under the 1986 Act.
Held: In doing so the prosecutor was acting to give effect to section 433.
The decision in Lambert to disallow retrospective . .
Lists of cited by and citing cases may be incomplete.

Evidence, Criminal Evidence, Insolvency, Crime

Updated: 19 May 2022; Ref: scu.87029

Practice Note (Administration Order Applications: Independent Reports): ChD 25 Jan 1994

Guidance from Vice Chancellor on cost of obtaining independent reports.

Citations:

Times 25-Jan-1994

Jurisdiction:

England and Wales

Cited by:

Cited – Practice Statement (Administration order: Reports) ChD 15-Apr-2002
The statement was issued as a gloss on the 1994 practice statement. A party wishing to restrict access to all or any part of an independent report prepared in support of an application for an administration order must be ready to support their . .
Lists of cited by and citing cases may be incomplete.

Insolvency

Updated: 19 May 2022; Ref: scu.84975

Mulvey v Secretary of State for Social Security: HL 20 Mar 1997

The appellant had had repayable awards from the social fund and also income support benefit. Deductions were made from the benefit to repay the awards. Her estate was sequestrated. She argued that the awards should no longer be deducted.
Held: Deductions by way of recoupment for overpayments of benefit were correctly continued after bankruptcy.
Lord Jauncey said: ‘By no stretch of the imagination could the respondent’s exercise of his statutory right be described as diligence for the purpose of the law of Scotland’.
The rule at common law rule was also disapplied: ‘The deductions made by the respondent were not, as in the normal case of compensation in bankruptcy, a result of the bankruptcy, but were made in pursuance of a statutory scheme which was already in operation at the time of sequestration and with which the permanent trustee can have no concern. Prior to sequestration, the appellant had no right to receive by way of income support benefit more than her gross entitlement under deduction of such sum as had been notified to her by the respondent prior to payment of the award by the respondent. This was the result of the statutory scheme and she could not have demanded more.’

Judges:

Lord Browne-Wilkinson, Lord Jauncey of Tullichettle, Lord Mustill, Lord Slynn of Hadley, Lord Lloyd of Berwick

Citations:

[1997] UKHL 10, 1997 SC (HL) 105

Links:

House of Lords, Bailii

Statutes:

Social Security Administration Act 1992 167(3), Social Security Contributions and Benefits Act 1992 138(1)

Citing:

Cited – Fraser v Robertson 1881
A creditor in an obligation undertaken by a debtor prior to sequestration must, after sequestration, enforce that obligation against the estate vested in the trustee and can only seek a decree of constitution there anent against the debtor . .
Cited – Macdonald’s Trustee v Macdonald 1938
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 . .
Cited – Bradley-Hole v Cusen CA 1953
The creditor was a tenant of rent-controlled premises who had been charged too much rent by his landlord. The bankrupt landlord’s trustee argued that the claim in respect of overpaid rent had been converted into a right to prove the debt in the . .
Appeal from – Mulvey v Secretary of State for Social Security IHCS 24-Nov-1995
The claimant had first been granted a loan from the Social Fund. After her bankruptcy, the benefits loan was recoverable from benefits even after the bankruptcy if the loan was not proved in the bankruptcy. The right to recover by deduction was but . .

Cited by:

Cited – Secretary of State for Work and Pensions v Payne and Another SC 14-Dec-2011
The appellant sought to recover overpayments of benefits and Social Fund Loans, after the respondent had had a Debt relief order.
Held: The Secretary of State’s appeal failed. The ‘net entitlement principle’ argued for did not exist. The . .
Lists of cited by and citing cases may be incomplete.

Insolvency, Benefits, Scotland

Updated: 19 May 2022; Ref: scu.84121

Dennison v Krasner, Lesser, Lawrence: CA 6 Apr 2000

A retirement annuity or personal pension was part of a bankrupt’s estate before the recent Act, and vested immediately in the trustee on the bankruptcy. As such there was no need to make application to the court under s310 for an income payment order before those assets could be made available to the creditors. Acts of Parliament had at various times exempted certain kinds of pension assets from being available in this way, typically by avoiding assignments, but for this kind of pension this only happened in 1999. Chadwick LJ: ‘. . . in construing the relevant provisions of the [Insolvency Act 1986] the court should follow the approach indicated by Lord Diplock in Garland v British Rail Engineering Ltd [1983] 2 AC 751 at 755, and construe the words of the statute, if they are reasonably capable of bearing such a meaning, as intended to carry out an international obligation which the United Kingdom has assumed under a treaty or convention and not so as to be inconsistent with that obligation.’

Judges:

Chadwick LJ

Citations:

Times 18-Apr-2000, Gazette 11-May-2000, [2000] EWCA Civ 112, [2001] Ch 76

Links:

Bailii

Statutes:

Insolvency Act 1986 306 (1) 310, Welfare Reform and Pensions Act 1999

Jurisdiction:

England and Wales

Citing:

Cited – Garland v British Rail Engineering Ltd ECJ 9-Feb-1982
garland_breECJ1982
The fact that an employer (although not bound to do so by contract) provides special travel facilities for former male employees to enjoy after their retirement constitutes discrimination within the meaning of article 119 against former female . .
Approved – In Re Landau (A Bankrupt) ChD 1-Dec-1996
At the date of the bankruptcy the bankrupt was entitled to a pension, payable in the future on his attaining the age of 65 years. He was aged 61 when the bankruptcy order was made, and 64 when it was discharged. The trustee claimed to be entitled to . .

Cited by:

Cited – Malcolm v Mackenzie, Allied Dunbar Plc CA 21-Dec-2004
The bankrupt complained that having been made bankrupt, his self-employed pension was subject to attachment by his trustee, but had he been a member of a company scheme the asset would not, and that this was discriminatory.
Held: The . .
Cited – Horton v Henry CA 7-Oct-2016
No obligation on bankrupt to draw on pension fund
The trustee in bankruptcy appealed against a decision dismissing his application for an income payments order pursuant to section 310 of the 1986 Act in respect of income which might become payable to the respondent from his personal pension . .
Lists of cited by and citing cases may be incomplete.

Insolvency, Financial Services

Updated: 19 May 2022; Ref: scu.82838

Foxley v United Kingdom: ECHR 20 Jun 2000

A bankrupt was suspected of disposing of his assets to avoid a confiscation order. The trustee in bankruptcy obtained an order for the bankrupt’s post to be diverted to her whilst he was in prison. She opened all post and copied it before forwarding it to the bankrupt. This included correspondence with his legal advisers. The order and her practice infringed the bankrupt’s human rights insofar as no distinction was made with respect to correspondence protected by legal privilege, and insofar as the order continued in effect after the bankrupt’s discharge. ‘The Court can see no justification for this procedure and considers that the action taken was not in keeping with the principles of confidentiality and professional privilege attaching to relations between a lawyer and his client. It notes in this connection that the Government have not sought to argue that the privileged channel of communication was being abused; nor have they invoked any other exceptional circumstances which would serve to justify the interference with reference to their margin of appreciation.’

Citations:

Times 04-Jul-2000, (2001) 31 EHRR 637, 33274/96, [2000] ECHR 223, [2000] ECHR 224

Links:

Worldlii, Bailii

Statutes:

Insolvency Act 1986 371, European Convention on Human Rights

Cited by:

Cited – Regina v Special Commissioner And Another, ex parte Morgan Grenfell and Co Ltd HL 16-May-2002
The inspector issued a notice requiring production of certain documents. The respondents refused to produce them, saying that they were protected by legal professional privilege.
Held: Legal professional privilege is a fundamental part of . .
Cited – Bowman v Fels (Bar Council and Others intervening) CA 8-Mar-2005
The parties had lived together in a house owned in the defendant’s name and in which she claimed an interest. The claimant’s solicitors notified NCIS that they thought the defendant had acted illegally in setting off against his VAT liability the . .
Lists of cited by and citing cases may be incomplete.

Human Rights, Insolvency, Legal Professions

Updated: 19 May 2022; Ref: scu.80653

Dora v Simper and Others: ChD 26 May 1999

A creditor’s claim to set aside an insolvent debtor’s transaction as being at an undervalue could not be pursued to benefit that creditor alone, and a plaintiff was not entitled to his full judgment and costs. A conspiracy claim was hard to establish.

Citations:

Times 26-May-1999

Statutes:

Insolvency Act 1986 423

Jurisdiction:

England and Wales

Insolvency

Updated: 19 May 2022; Ref: scu.80100

Cork v Rolph: ChD 21 Dec 2000

The applicant was an insolvency practitioner, appointed as liquidator in some 116 insolvencies. He was moving to a different firm, and sought to be relieved from his duty to act in these cases. Such applications must be judged on their individual merits. In this case, his new duties would detract from his ability properly to supervise the liquidations, and he had not taken with him the staff who had been employed in dealing with the cases. Those factors suggested that it would be more economic to transfer the appointments. In this case, it was satisfactory to merely advertise the change of appointments, rather than to write to each creditor individually.

Citations:

Times 21-Dec-2000

Insolvency

Updated: 19 May 2022; Ref: scu.79509

Cox v Bankside Members Agency Ltd and Others: QBD 27 Jan 1995

Some agents had policies against which there were likely to be various calls, either because several claims were being pursued against the same agents by different Lloyd’s Names, or because the policies were group policies covering several agents against each of which claims were being pursued, by different Lloyd’s Names. The essential issue was whether each claim ascertained as against an agent exhausted the agent’s insurance cover pro tanto, or whether all claims falling individually within a policy’s scope ranked or could be treated as ranking pari passu against the policy in whatever order they were ascertained against the insured agent or agents.
Held: Lloyds claims are to have priority of payment according to time of orders. The statutory transfer under the Act occurred notwithstanding that the insured’s liability to the third party had not yet been extinguished. The statutory transfer to the third party of the insured’s right against his insurer takes place at the moment of his bankruptcy.
Phillips J said: ‘In a situation of solvency, the ranking of claims against the EandO underwriter depends upon the order in which the third party Names establish liability against the assured by judgment, arbitration award or settlement, thereby giving rise to a vested right on the part of the assured to indemnity in accordance with the terms of the cover. The same is true in a situation of insolvency. If the insolvency occurs after third party Names have established quantified liability, the right or rights to indemnity that were thereby established in the assured agent will be transferred to the Names upon the assured becoming formally insolvent. If quantified liability has not been established at the date of insolvency, a third party Name asserting a claim will have transferred under the Act merely an inchoate or contingent right. If before that Name establishes a quantified claim, other quantified claims are established which exhaust the cover, his contingent right will be rendered nugatory.’ Phillips J summarised the relationship between the insurers and the solicitors acting: ‘Where underwriters instruct a solicitor to conduct the defence, they thereby create the relationship of solicitor and client between the solicitor and the assured . . The normal consequence of this is that the assured becomes liable to pay the solicitor’s costs, even if the underwriters were also liable for those costs . . Those costs are properly deemed to be incurred by the assured, even if they are funded by underwriters. . .’

Judges:

Phillips J

Citations:

Times 27-Jan-1995, [1995] 2 Lloyd’s Rep 437

Cited by:

Appeal from – Cox v Bankside Members Agency Ltd and Others CA 16-May-1995
Successful Lloyds names were entitled to enforce their claims in the normal time sequence. The transfer of the rights of the insured against the insurer under section 1(1) the 1930 Act takes place on the event of insolvency, even if the insured’s . .
Cited – Centre Reinsurance International Co and Another v Curzon Insurance Ltd ChD 12-Feb-2004
It was a necessary part of the system of statutory transfers of insurance obligations under the Act, that the rights should be transferred before exhaustion of any policy excess, and notwithstanding the insolvency. The rights (inchoate at this . .
Cited – First National Tricity Finance Ltd v OT Computers Ltd; In re OT Computers Ltd (in administration) CA 25-May-2004
The company had gone into liquidation. They had sold consumer policies as extended warranties on behalf of the claimant. The company had insured its own joint liability under the contracts, and the claimant sought information from the company’s . .
Cited – Law Society of England and Wales and others v Shah and others ChD 30-Nov-2007
Solicitor firms had been made bankrupt leaving a shortfall after thefts from client accounts of over 12 million pounds. The thief had diappeared, and the other partners were now discharged form bankruptcy. The Law Society accepted that it could not . .
Cited – Teal Assurance Company Ltd v WR Berkley Insurance (Europe) Ltd SC 31-Jul-2013
An international engineering company had several layers of professional indemnity insurance. The top later did not cover claims originating in the US or Canada. The several insurers now disputed apportionment of liability between them. The . .
Lists of cited by and citing cases may be incomplete.

Litigation Practice, Insolvency, Insurance

Updated: 19 May 2022; Ref: scu.79586

Carter-Knight (A Bankrupt) v Peat: ChD 27 Jul 2000

The applicant had fallen into arrears with the voluntary arrangement, and the supervisor petitioned for bankruptcy. Before the hearing the debtor paid off the arrears, but the supervisor asked to continue with the petition. However in this case the judge had failed to give reasons for his decision, and the case was remitted to another district judge to be reheard.

Citations:

Times 11-Aug-2000, Gazette 27-Jul-2000

Insolvency

Updated: 19 May 2022; Ref: scu.78923

Biosource Technologies Inc v Axia Genetics Plc (In Administration): ChD 25 Nov 1999

The rule which prevents a company in administration being prosecuted without the leave of the court, was not intended only to restrict creditors. Here another company wanted to bring patent infringement proceedings, but were first to be required to obtain the court’s consent.

Citations:

Times 25-Nov-1999, Gazette 25-Nov-1999

Statutes:

Insolvency Act 1986 11(3)(d)

Insolvency, Litigation Practice, Intellectual Property

Updated: 18 May 2022; Ref: scu.78409

In Re Conley: CA 1938

A loan had been made, secure by a deposit by a third party. The company was said to have repaid the secured overdraft to secure the release of the deposit and its release from the hands of the general creditors. The court was asked whether the person providing the security had acted as a ‘surety or guarantor’ within section 44 of the 1914 Act. The depositor argued that since a bare deposit had not created a personal liability, she could not be a surety.
Held: She could be so treated under the Act.

Citations:

[1938] 2 All ER 127

Statutes:

Bankruptcy Act 1914 44

Jurisdiction:

England and Wales

Cited by:

Cited – Tam Wing Chuen v Bank of Credit and Commerce Hong Kong Ltd PC 1996
The Board considered a banking transaction and the application of a chargeback by the bank, under which a loan was made only after a deposit by a third party against which it was secured, and particularly in the context of the insolvency of the bank . .
Lists of cited by and citing cases may be incomplete.

Insolvency

Updated: 18 May 2022; Ref: scu.617852

Borneman v Wilson: CA 1884

The Wilsons, father and son, had acted as commercial agents of one Borneman. He began an action against them in the Chancery Division for an account of their dealings with his goods and obtained interlocutory relief on motion including an injunction and the appointment of a receiver. The Wilsons served a notice of appeal, but shortly afterwards a bankruptcy order was made against them. On 7 October 1884, a trustee in bankruptcy was appointed. On 18 October, the trustee was substituted as a defendant, apparently ex parte on the application of Borneman. On 31 October, he gave notice abandoning the appeal. He then entered an appearance in the substantive proceedings and called for a statement of claim. Borneman applied for an order against the trustee requiring him to pay the costs of the appeal which he had incurred before receipt of the notice of abandonment.
Held: The order was made. notwithstanding the trustee’s prompt and express abandonment of the appeal, by appearing and calling for a statement of claim in the Chancery proceedings he had adopted the action, and that meant the entire action including the appeal.
Bowen LJ said that the trustee: ‘cannot adopt part of the action and leave out the rest.’

Judges:

Bowen and Fry LJJ

Citations:

(1884) 28 Ch D 53

Cited by:

Adopted – School Board for London v Wall Brothers CA 1891
. .
Cited – Trustee of Property of Vickery (a Bankrupt) v Modern Security Systems Limited CA 15-Oct-1997
A trustee in bankruptcy will be treated as the party if he has in fact adopted the proceedings by conducting the litigation, even if there has been no formal substitution . .
Cited – BPE Solicitors and Another v Gabriel SC 17-Jun-2015
Application for directions in a pending appeal. The claimant alleged negligence against his former solicitors. After his successful claim was substantially overturned on appeal, he was made bankrupt.
Held: If the trustee adopted and pursued . .
Lists of cited by and citing cases may be incomplete.

Insolvency, Costs

Updated: 18 May 2022; Ref: scu.566481

School Board for London v Wall Brothers: CA 1891

Judges:

Lord Esher MR and Lopes and Kay LJJ

Citations:

(1891) 8 Morr 202

Citing:

Adopted – Borneman v Wilson CA 1884
The Wilsons, father and son, had acted as commercial agents of one Borneman. He began an action against them in the Chancery Division for an account of their dealings with his goods and obtained interlocutory relief on motion including an injunction . .

Cited by:

Cited – BPE Solicitors and Another v Gabriel SC 17-Jun-2015
Application for directions in a pending appeal. The claimant alleged negligence against his former solicitors. After his successful claim was substantially overturned on appeal, he was made bankrupt.
Held: If the trustee adopted and pursued . .
Lists of cited by and citing cases may be incomplete.

Costs, Insolvency

Updated: 18 May 2022; Ref: scu.566482

Re Howard Holdings Inc: ChD 1998

It is difficult to envisage any developed system of corporate law which does not impose some obligation on directors to consider whether the company is solvent and, if not, to consider what should be done about it.
Chadwick J said: ‘I accept that when deciding whether or not to make a declaration under s.214 of the Act, the court will take into account what the obligations of the director to his company were at the time when he had the opportunity to minimise the potential loss to the company’s creditors. And I accept that it might well be that, in circumstances where the relevant governing law imposed no obligation on directors to have any regard to the interests of the company or its creditors in the course of their management of its affairs, the English court would decide that a declaration was not appropriate.’

Judges:

Chadwick J

Citations:

[1998] BCC 549

Statutes:

Insolvency Act 1986 214

Cited by:

Cited – Bilta (UK) Ltd and Others v Nazir and Others ChD 30-Jul-2012
The company was said to have engaged in a fraud based on false European Trading Scheme Allowances, and had been wound up by the Revenue. The liquidators, in the company name, now sought recovery from former directors and associates.
Held: The . .
Lists of cited by and citing cases may be incomplete.

Insolvency

Updated: 18 May 2022; Ref: scu.565824

Carman v The Kronos Group SA: 2006

The court acted on the basis that section 213 of the 1996 Act had extra-territorial effect.

Citations:

[2006] BCC 451

Statutes:

Insolvency Act 1996 213

Jurisdiction:

England and Wales

Cited by:

Cited – Bilta (UK) Ltd and Others v Nazir and Others ChD 30-Jul-2012
The company was said to have engaged in a fraud based on false European Trading Scheme Allowances, and had been wound up by the Revenue. The liquidators, in the company name, now sought recovery from former directors and associates.
Held: The . .
Lists of cited by and citing cases may be incomplete.

Insolvency, Jurisdiction

Updated: 18 May 2022; Ref: scu.565825

In re Bluck, Ex parte Bluck: 1887

The discretionary character of a costs order meant that it was not even a contingent liability until the order had actually been made

Citations:

(1887) 57 LT 419

Cited by:

Cited – In re Nortel Companies and Others SC 24-Jul-2013
The court was asked as to the interrelationship of the statutory schemes relating to the protection of employees’ pensions and to corporate insolvency.
Held: Liabilities which arose from financial support directions or contribution notices . .
Cited – BPE Solicitors and Another v Gabriel SC 17-Jun-2015
Application for directions in a pending appeal. The claimant alleged negligence against his former solicitors. After his successful claim was substantially overturned on appeal, he was made bankrupt.
Held: If the trustee adopted and pursued . .
Lists of cited by and citing cases may be incomplete.

Insolvency, Costs

Updated: 18 May 2022; Ref: scu.537712

In re A Debtor (No 68 of 1911): 1911

Citations:

[1911] 2 KB 652

Cited by:

Cited – In re Nortel Companies and Others SC 24-Jul-2013
The court was asked as to the interrelationship of the statutory schemes relating to the protection of employees’ pensions and to corporate insolvency.
Held: Liabilities which arose from financial support directions or contribution notices . .
Cited – BPE Solicitors and Another v Gabriel SC 17-Jun-2015
Application for directions in a pending appeal. The claimant alleged negligence against his former solicitors. After his successful claim was substantially overturned on appeal, he was made bankrupt.
Held: If the trustee adopted and pursued . .
Lists of cited by and citing cases may be incomplete.

Insolvency, Costs

Updated: 18 May 2022; Ref: scu.537713

Cornhill Insurance plc v Improvement Services Ltd: 1986

Held: Where a company was under an undisputed obligation to pay a specific sum and failed to do so, it could be inferred that it was unable to do so; that accordingly, the defendants could properly swear to their belief in the plaintiff company’s insolvency and present a petition for its winding up.
Harman J said: ‘That appears to me to be sound reason and sound law. I re-enforce it by reference to a decision in Re a Company 1950 (94) SOL J 369 Visey J in the matter in which counsel of the utmost distinction in Chancery at that time both leading and junior counsel appeared said that where a Company was well known and wealthy it was the more likely the delay in settlement of its obligation would create suspicion of its financial embarrassment.’ ‘Rich man and rich companies which did not pay their debts had only themselves to blame if it were thought that they could not pay them.’

Judges:

Harman J

Citations:

[1986] 1 WLR 1, [1986] BCLC 26

Citing:

Cited – Mann v Goldstein ChD 1968
Ungoed-Thomas J said: ‘When the creditor’s debt is clearly established it seems to me to follow that this court would not, in general at any rate, interfere even through the company would appear to be solvent, for the creditor would as such be . .

Cited by:

Cited – BNY Corporate Trustee Services Ltd and Others v Neuberger SC 9-May-2013
Potential Insolvency effect under guarantee
The various parties had entered into complex and substantial financial arrangements incorporating guarantees. The guarantees were conditional upon the guaranteed party being solvent. The parties disputed whether a party which would otherwise be . .
Lists of cited by and citing cases may be incomplete.

Company, Insolvency

Updated: 18 May 2022; Ref: scu.535113

In re Kavanagh: KBD 1949

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.

Citations:

[1949] 2 All ER 264

Cited by:

Cited – Hannon and Another v News Group Newspapers Ltd and Another ChD 16-May-2014
The claimants alleged infringement of their privacy, saying that the defendant newspaper had purchased private information from police officers emplyed by the second defendant, and published them. The defendants now applied for the claims to be . .
Lists of cited by and citing cases may be incomplete.

Insolvency

Updated: 18 May 2022; Ref: scu.525973

Ex parte Sidebotham; In re Sidebotham: CA 1880

James LJ said: ‘but the words ‘person aggrieved’ do not really mean a man who is disappointed of a benefit which he might have received if some other order had been made. A ‘person aggrieved’ must be a person who has suffered a legal grievance, a man against whom a decision has been pronounced which has wrongfully deprived him of something, or wrongfully refused him something, or wrongfully affected his title to something.’

Judges:

James LJ

Citations:

(1880) 14 Ch D 458, [1874-80] All ER 588

Statutes:

Bankruptcy Act 1869 71

Cited by:

Cited – Walton v The Scottish Ministers SC 17-Oct-2012
The appellant, former chair of a road activist group, challenged certain roads orders saying that the respondent had not carried out the required environmental assessment. His claim was that the road had been adopted without the consultation . .
Lists of cited by and citing cases may be incomplete.

Insolvency

Updated: 18 May 2022; Ref: scu.470545

Smith v Mills: 1584

A. became bankrupt, and, after a commission awarded against him, sold part of his goods to one of his creditors in part satisfaction of his debt ; and afterwards the comissioners by indenture sold those goods jointly to the plaintiffs, who were the other creditors : Held that the sale by the commissioners was good, for the intent of the statute 13 Eliz. c. 7, is to relieve the creditors equally in distribution of the bankrupt’s estate, and he himself cannot dispose of his property after the commission awarded ; and if a creditor refuse or neglect to come in under the commission, and the property is assigned to others, it is aIso good.

Citations:

[1584] EngR 15, (1584) 2 Co Rep 25, (1584) 76 ER 441

Links:

Commonlii

Insolvency

Updated: 18 May 2022; Ref: scu.429297

Inland Revenue Commissioners v Goldblatt: 1972

In a winding up case, the Commissioners can if necessary proceed against a receiver for misfeasance.

Citations:

[1972] Ch 498

Jurisdiction:

England and Wales

Cited by:

Cited – Total Network Sl v Revenue and Customs HL 12-Mar-2008
The House was asked whether an action for unlawful means conspiracy was available against a participant in a missing trader intra-community, or carousel, fraud. The company appealed a finding of liability saying that the VAT Act and Regulations . .
Lists of cited by and citing cases may be incomplete.

Taxes Management, Insolvency, Torts – Other

Updated: 18 May 2022; Ref: scu.268780

Ashe v Mumford and Others: ChD 7 Mar 2000

The Regulation under question was procedural;, and a failure to comply with its requirements was not to be deemed fatal. The requirement for a trustee to identify the transactions to be set aside did not require every single part of the scheme to be detailed, provided as in this case the purpose of the scheme was clearly to defeat creditors and the trustee in bankruptcy. The mother of a bankrupt purchased her council house with a fifty per cent discount, and was funded as to the rest by the bankrupt’s wife.

Citations:

Times 07-Mar-2000, Gazette 09-Nov-2000

Statutes:

Insolvency Rules 1986 (1986 No 1925) 7.3

Cited by:

Appeal from – Ashe v Mumford CA 2001
The court considered the relative interests arising in the trust of a house bought under the right to buy scheme.
Held: The court upheld the trial judge’s decision that the discount should not be apportioned between the parties, the series of . .
Lists of cited by and citing cases may be incomplete.

Litigation Practice, Insolvency

Updated: 17 May 2022; Ref: scu.77892

Anderson v Hyde and Others: CANI 2 May 1996

The defendant company was wound up after the receiver had been appointed and the liquidator declined to take over the defence to the action. The judge had refused an application for a third party costs order against the receivers.
Held: Had the defence been taken over by the liquidator the costs of the claimant would have ranked in priority to the claims of ordinary unsecured creditors, and it would not be just and equitable for a receiver to be able to defend the action without any liability for costs whatever the outcome. A receiver of a company taking over the defence of a case is liable in costs as a party, but is entitled to an indemnity.

Citations:

Times 02-May-1996, [1996] 2 BCLC 144

Cited by:

Cited – Dolphin Quays Developments Ltd v Mills and others CA 17-May-2007
The owner had agreed to sell a long lease of an apartment to the defendant. Part of the price was to be by way of set off of an existing debt, but ths was not set out in the contract. The claimant bought the land and the benfit of the contract from . .
Lists of cited by and citing cases may be incomplete.

Insolvency, Northern Ireland, Costs

Updated: 17 May 2022; Ref: scu.77787

AIB Finance Ltd v Debtors: ChD 10 Apr 1997

A Statutory Demand is only finally decided after the failure of a set aside application.

Judges:

Carnwath J

Citations:

Times 10-Apr-1997, [1997] 2 BCLC 354

Statutes:

Rules of the Supreme Court O59R10(2)

Cited by:

Appeal from – AIB Finance Ltd v Debtors (Alsop and Another) CA 11-Mar-1998
The duty of care of a lender to get the best price for repossessed properties, was not broken when the business closed before repossession, and the property was not sold as a going concern. . .
Lists of cited by and citing cases may be incomplete.

Insolvency, Banking

Updated: 17 May 2022; Ref: scu.77680

Highland Engineering Ltd v Thomson: 1972

The liquidation of a company is treated as the equivalent as bankruptcy to prevent the hardship of a debtor who is also a creditor being forced to pay in full, when he will come in only as a creditor for a dividend for his debt as a result of ranking pari passu with the ordinary creditors.

Citations:

1972 SC 87

Jurisdiction:

England and Wales

Cited by:

Cited – Melville Dundas Ltd and others v George Wimpey UK Ltd and others HL 25-Apr-2007
The appellant sought an interim payment for works of construction undertaken for the respondents under a JCT contract. The respondents contended that, having terminated the contract on their receivership, the contract and Act meant that the interim . .
Lists of cited by and citing cases may be incomplete.

Scotland, Company, Insolvency

Updated: 17 May 2022; Ref: scu.251596

Re Eichholz: 1959

The court left open the question whether, if the proceedings were brought by a trustee in bankruptcy, a representative creditor had to be joined.

Judges:

Harman J

Citations:

[1959] Ch 708

Cited by:

Cited – Hill (As Trustee In Bankruptcy of Nurkowski) v Spread Trustee Company Ltd and Another CA 12-May-2006
The defendants sought relief for transactions entered into at an undervalue. The bankrupt had entered into charges and an assignment of a loan account in their favour before his bankruptcy, and the trustee had obtained an order for them to be set . .
Lists of cited by and citing cases may be incomplete.

Insolvency

Updated: 17 May 2022; Ref: scu.244177

In re English, Scottish and Australian Chartered Bank: 1893

Vaughan Williams J said: ‘One knows that where there is a liquidation of one concern the general principle is – ascertain what is the domicile of the company in liquidation; let the court of the country of domicile act as the principal court to govern the liquidation; and let the other courts act as ancillary, as far as they can, to the principal liquidation. But although that is so, it has always been held that the desire to assist in the main liquidation – the desire to act as ancillary to the court where the main liquidation is going on – will not ever make the court give up the forensic rules which govern the conduct of its own liquidation.'(

Judges:

Vaughan Williams J

Citations:

[1893] 3 Ch 385

Cited by:

Cited – Cape Plc and Others, Re Companies Act 1985 ChD 16-Jun-2006
The court was asked to sanction a scheme of arrangements, and particularly to approve a proposed scheme which itself contained the power to make amendments to the scheme.
Held: The court did have power to sanction such a proposed scheme of . .
Cited – McGrath and others v Riddell and others HL 9-Apr-2008
(Orse In Re HIH Casualty and General Insurance Ltd)
HIH, an Australian Insurance company, became insolvent. An order was sought for the collection and remission of it assets in England under a letter of request from the Australia Court.
Lists of cited by and citing cases may be incomplete.

Company, Insolvency, International

Updated: 17 May 2022; Ref: scu.244199

Herbert Berry Associates Ltd v Inland Revenue Commissioners: CA 2 Jan 1976

The word ‘proceedings’ meant the ‘invocation of the jurisdiction of a court by process other than writ’.

Judges:

Russell LJ

Citations:

[1977] 1 WLR 617, [1977] 3 All ER 729, 121 SJ 252

Statutes:

Companies Act 1948

Jurisdiction:

England and Wales

Citing:

At ChD – Herbert Berry Associates Ltd v Inland Revenue Commissioners ChD 1976
The collector of taxes distrained on the goods of the company under section 61 TMA 1970 for unpaid taxes and the company entered into a walking possession agreement. Before the collector had sold the goods, and completed the distress, the company . .
Cited – Valensi v British Radio Corporation CA 1973
The court considered the test for deciding what degree of knowledge, skill and perseverance the skilled man was assumed to have as a ground for revocation of a patent on the associated basis. There had been a mistake in the specification of the . .

Cited by:

At CA – Herbert Berry Associates Ltd v Inland Revenue Commissioners; re Herbert BerrySP, Regina (on The Application of) v The Lord Chancellor HL 1977
The principle to the effect that the court should exercise its discretion to restrain a distress levied by a landlord before the commencement of a winding-up only where there were special circumstances rendering it inequitable that he should be . .
Lists of cited by and citing cases may be incomplete.

Insolvency, Company

Updated: 17 May 2022; Ref: scu.228992

Re Bullard and Taplin Ltd: ChD 1996

Tne question of whether there was at any time ‘pending court proceedings’ was answered by asking if there existed a court file. The section empowered a court itself to appoint another trustee in bankruptcy. Section 41 of the 1984 Act could be used by the HighCourt to take some control over proceedings for an individual voluntary arrangement in the County Court.

Judges:

Knox J

Citations:

[1996] BCC 973

Statutes:

Insolvency Act 1986 303, County Courts Act 1984 41(1)

Cited by:

Cited – Quickson (South and West) Limited v Stephen Mark Katz, John Stephen Kelmanson (As Joint Liquidators of Buildlead Limited) ChD 25-Aug-2004
Various applications were made in the insolvency, including for removal of the liquidators and declarations that certain payments were a fraudulent preference on the creditors.
Held: No prejudice had been shown by any procedural irregularity. . .
Cited – In Re Sutton (Removal of Liquidator) ChD 17-Oct-1997
The insolvency practitioner held many appointments. His partnership in a large firm of accountants ended suddenly. He did not have the resources to handle the cases, and nor could acceptable arrangements be made for him to have access to the related . .
Cited – In Re A and C Supplies Limited ChD 17-Oct-1997
Applications were made for the removal of a liquidator from several appointments in corporate nd individual insolvencies. He had been a partner in a firm and that had ceased in a way which left it impossible to work with his former partners to . .
Lists of cited by and citing cases may be incomplete.

Litigation Practice, Insolvency

Updated: 16 May 2022; Ref: scu.216396

Welsby v Brelec Installations Limited: ChD 2001

The CVA provided for the payment by the company of contributions to the supervisors for distribution to creditors. The company went on into a creditors’ voluntary liquidation.
Held: The sums held by the supervisors in trust for the CVA creditors remained subject to that trust notwithstanding the liquidation. Blackburne J said as to a CVA: ‘ . . the effect of the creditors’ approval of the debtors’ proposal is, as is well-established, to give rise to a species of statutory contract between the creditors bound by the arrangement on the one hand and the debtor on the other.’ and ‘An arrangement is usually put together in some haste. Mod~flcations to it are frequently made at the statutory meeting of creditors with little time to reflect on how they relate to the other terms of the debtor’s proposal. Quite often, as this case demonstrates, the resulting terms are clumsily worded. The arrangement ought therefore to be construed in a practical fashion. Otherwise there is a risk that careless drafting coupled with a too-literal approach to its construction will serve to frustrate rather than achieve the purpose of the arrangement.’

Judges:

Blackburne J

Citations:

[2001] BCC 421, [2002] 2 BCLC 576

Jurisdiction:

England and Wales

Cited by:

Cited – Wright and Another (Liquidators of SHB Realisations Ltd) v The Prudential Assurance Company Ltd ChD 6-Mar-2018
IVA is a special form of contract
Liquidators asked the court whether sums sought by the insolvent company’s landlords were payable and or provable. Under an IVA, the copany had been paying reduced rents, but the arrangement document provided that the full rents would be restored on . .
Lists of cited by and citing cases may be incomplete.

Insolvency, Company

Updated: 16 May 2022; Ref: scu.605851

Tanner v Everitt: ChD 2004

Mann J discussed the status of an IVA in contract law: ‘The arrangement is therefore contractually based, with the statute providing the consent or deemed consent of the otherwise dissenting parties’

Judges:

Mann J

Citations:

[2004] EWHC 1130

Jurisdiction:

England and Wales

Cited by:

Cited – Wright and Another (Liquidators of SHB Realisations Ltd) v The Prudential Assurance Company Ltd ChD 6-Mar-2018
IVA is a special form of contract
Liquidators asked the court whether sums sought by the insolvent company’s landlords were payable and or provable. Under an IVA, the copany had been paying reduced rents, but the arrangement document provided that the full rents would be restored on . .
Lists of cited by and citing cases may be incomplete.

Insolvency

Updated: 16 May 2022; Ref: scu.605849

Commissioners of Inland Revenue v Adam and Partners Ltd: ChD 2000

Judges:

Nicholas Warren QC, DHCJ

Citations:

[2000] BCC 513

Jurisdiction:

England and Wales

Cited by:

Cited – Wright and Another (Liquidators of SHB Realisations Ltd) v The Prudential Assurance Company Ltd ChD 6-Mar-2018
IVA is a special form of contract
Liquidators asked the court whether sums sought by the insolvent company’s landlords were payable and or provable. Under an IVA, the copany had been paying reduced rents, but the arrangement document provided that the full rents would be restored on . .
Lists of cited by and citing cases may be incomplete.

Insolvency

Updated: 16 May 2022; Ref: scu.605848

In re Edennote Ltd (No 2): ChD 1997

Sanction was sought against a liquidator. Lightman J said: ‘The question is the commercial best interests of the company, reflected prima facie, by the commercial judgment of the liquidator, a judgment in my view which, in the circumstances and in the light of the evidence in this case, ought to be given full weight.’

Judges:

Ligtman J

Citations:

[1997] 2 BCLC 89

Jurisdiction:

England and Wales

Citing:

See Also – In Re Edennote Ltd; Tottenham Hotspur plc v Ryman CA 21-May-1996
The company was in liquidation. Terence Venables, who had owned the shares, had taken an assignment of a cause of action against the football club. The court had set aside that assignment, and removed the liquidator. Venables now appealed saying . .

Cited by:

Cited – Whitehouse v Wilson (Liquidator of Vol-Mec Ltd) and Another CA 7-Dec-2006
. .
Cited – Greenhaven Motors Limited (In Liquidation) and Another v BG Funding Limited and Another CA 31-Jul-1998
. .
Lists of cited by and citing cases may be incomplete.

Insolvency

Updated: 15 May 2022; Ref: scu.346609

Simeon Warburg v William Owen Tucker: 12 Jun 1855

Defendant, being indebted to plaintiff, assigned to him, as security, an insurance ori defendant’s life, and an insurance on the life of defendant’s wife, and covenanted (1) to pay the premiums, (2) that, if he did not pay them, plaintiff might pay them and defendant would repay plaintiff. PlainItiff sued defendant on tbis covenant, assigning, as breaches of covenant, (1) that defendant had not paid the premiums, and (2) that defendant had not paid to plaintiff’ premiums paid by plaintiff in defendant’s default. Defendant, to the whole declaration, pleaded his bankruptcy and certificate, averring that they had occurred after the execution of the deed, but not that they had occurred after the breaches had taken place. Held, on demurrer to the plea: that the plea gave no answer to the declaration, neither of the plaintifYs claims being a debt payable upon Contingency, within sect. 177 of The Bankrupt Law Corisolidation Act, 1849 (12 and 13 Vict. e. lOS), nor a liability to pay money upon a contingency, within sect. 178.

Citations:

[1855] EngR 595, (1855) 5 El and Bl 384, (1855) 119 ER 524

Links:

Commonlii

Jurisdiction:

England and Wales

Insolvency

Updated: 15 May 2022; Ref: scu.292517