Judgment of Kerr J. in Stockport Metropolitan Borough Council v Punj Lloyd Limited [2018] EWHC 3776

Introduction

The UNCITRAL Model Law on the Recognition and Enforcement of Insolvency Related Judgments (‘the New Model Law’) is intended to fill the gaps that currently exist in cross-border conventions as they apply to the recognition and enforcement of judgments in insolvency proceedings.

Original news

Goldcrest Distribution Limited v McCole and others [2016] EWHC 1571 (Ch)

What is the background to this case?

The claimant lender, C, sought possession of residential property owned jointly by D1 and his partner D2 (the property) pursuant to a purported legal charge entered into by both the D1 and D2 (the charge). The charge secured D1’s liability to C arising under a guarantee whereby D1 had guaranteed the indebtedness of his company, "Ascot" to C.

A version of this article was first published in The Law Society Gazette and Prime Resi.

Facts 

The respondents applied to set aside an order permitting the liquidators to serve the ‘Main Application’ on the respondents out of the jurisdiction (‘Set Aside Application’). Grounds of the application were: (i) the liquidators could not establish a serious issue to be tried/ reasonable prospect of success on the Main Application; and (ii) the initial without notice application had been procured by misrepresentation and/or material non-disclosure.

Facts

Solicitors, Stevensdrake, sought payment of costs from insolvency practitioner, Hunt. As liquidator, Hunt took action against two former administrators of an estate, and retained Stevensdrake for assistance. Early in their relationship, the parties agreed that Hunt would not be liable if there were no recoveries, and that the solicitors would be paid when there was a recovery from any source. The parties later entered a conditional fee agreement (CFA) with an express term stipulating that Hunt would be personally liable for unpaid fees.

Facts

Longmeade went into compulsory liquidation. The liquidators were advised that the company had a good claim against BIS. The liquidators has secured third party funding in respect of the claim, which if successful, would double the dividend for creditors. However, 99% by value of the creditors of the company opposed the commencement of an action against BIS. The position of the few remaining creditors was unclear. The liquidators applied to the court for directions as to whether to cause the Longmeade to pursue the claim.

Held 

Facts

The company (‘Goldtrail’) was a tour operator. The director, who owned 100% of the company, had attempted to sell 50% of his shares to each of two companies without one knowing about the other. Goldtrail went into liquidation leaving passengers stranded overseas and owing £20m for repatriation.

Facts

The husband and wife were directors and shareholders of a company (‘C’). The husband was adjudged bankrupt in June 2014; the petitioners were appointed as his trustees in bankruptcy. Among the assets vested in the trustees under s 306 of the Insolvency Act 1986 (IA 1986), was the husband’s shareholding in C. However, the trustees were not registered as members of C until March 2015.

Does section 127 of the Insolvency Act 1986 void payments made by the insolvent company’s bank after the presentation of a winding-up petition but pursuant to payment instructions issued by the company before presentation of the petition?