Valuation evidence

The court has reaffirmed that comparable sales evidence is the best evidence when determining the retrospective valuation of a property.

The Insolvency Service (IS) has published a consultation paper on reforming debtor petition bankruptcy and early discharge from bankruptcy. The proposed reforms, which are aimed at speeding up the procedure and lowering costs, are to:

In our update this month we take a look at three cases that provide helpful clarification from the courts on issues that will be of interest to the insolvency and fraud industry - the key message from each case confirms:

Defendant's threat of insolvency did not prevent adjudicator's decision being enforced.

The case of White v Davenham Trust Ltd, has reaffirmed that a creditor can choose its own method of enforcing a debt which has been guaranteed even where it might hold security for that debt.

Where the Courts Service failed to notify the Land Registry of a bankruptcy petition with the effect that property was disposed of without a pending action having been registered, the trustee in bankruptcy had a right to claim damages.

Gowling WLG's finance litigation experts bring you the latest on the cases and issues affecting the lending industry.

Interests of bankrupt's creditors remain paramount

In Pickard and another (Joint Trustees in Bankruptcy of Constable) v Constable, the question before the court was how exceptional the circumstances had to be to postpone an order for possession and sale of a property in which the bankrupt had a 50% share.

The court has a limited discretion not to make a bankruptcy order where the debt is the subject of a statutory demand which has not been paid and is outstanding at the time of the bankruptcy petition hearing.

The making of a bankruptcy order alone will not deprive a judgment creditor of a final charging order where it is obtained before the bankruptcy order is made.

In our update this month we take a look at a case in which a non-party costs order was made against a major shareholder in the insolvent claimant company. The court found that the shareholder was the real party to the litigation; it funded the litigation, it was exercising control over the litigation and it would have been the main beneficiary had the litigation succeeded. We cover this, and other issues affecting the insolvency and fraud industry:

Montpelier Business Reorganisation Ltd v Jones & Others (2017)

Background

In circumstances where a debtor lacks mental capacity to deal with a statutory demand and subsequent bankruptcy petition, the court will rescind or annul a bankruptcy order.