Jurisdiction(s):
United Kingdom

Maxima v Fealy: Third Excepted Case requires continuous 12‑month non‑dormancy (significant accounting transactions) to avoid s217 liability for prohibited name (IA 1986; IR 2016 r22.7; CA 2006)

Published on: 21 November 2024

Published by a LexisNexis Restructuring & Insolvency expert

Legal News

Article summary

Maxima Creditor Resolutions Ltd v Fealy and another [2024] EWHC 2694 (Ch) What are the practical implications of this case?

When assessing whether the test for being non-dormant under The Third Excepted Case is engaged, directors and their advisers must scrutinise the company’s trading record across the 12 months before the first company’s insolvency, alongside the dormancy framework in CA 2006, ss 1169 and 386. That said, the Companies Act requirements and IR 2016, SI 2016/1024, r 22.7(b) are not aligned on dormancy. To come within The Third Excepted Case, directors must be able to demonstrate that, throughout the entire qualifying year preceding the first company’s insolvent liquidation, the company carried out the kind of significant accounting transactions contemplated by CA 2006, ss 1169 and 386—namely those that s 386 requires to be entered in the company’s accounting records. Proof that such transactions occurred only at points within that period—so that the company was non-dormant merely at some stage during the 12 months—will not meet the threshold...

To view the latest version of this document and thousands of others like it, sign-in with LexisNexis or register for a free trial.

Popular documents

Using the Judicial College Guidelines to assess general damages in personal injury claims

When evaluating a general damages claim, the practitioner ought initially to refer to the Judicial College Guidelines (JCG)...

Tomlin orders in England and Wales: CPR guidance on drafting, confidentiality, approval, variation, enforcement, limitation, CCA issues, court-specific requirements, sample wording and precedents

This Practice Note This Practice Note reviews mechanisms used in settling litigation. A Tomlin order consists of a consent order paired with a schedule. It operates to stay proceedings on terms that have been agreed. The provisions contained in the schedule may remain confidential. This Practice Note describes the scope of confidentiality attaching to the schedule and sets out how it differs from a standard consent order. Sample wording for a Tomlin order is included, alongside links to precedents, as well as guidance on court approval. It also addresses varying, setting aside and enforcing a Tomlin order, including the considerations the court will take into account when handling applications for each. Further guidance is provided on interpreting and applying the relevant provisions of the CPR; however, some courts and divisions impose very specific requirements for both drafting and approval, and for approaching the schedule and confidentiality issues. Accordingly, you must consider the particular rules and court guide provisions in the forum where your claim is proceeding when drawing up the Tomlin order...

Precedent: Deed of Surrender of Lease with Optional Premium, Settlement and Release, Landlord, Mortgagee and Guarantor Consents, Reimbursement and HM Land Registry Provisions (England and Wales)

Date [ date ] Parties [ name of Landlord ] [ of OR incorporated in England and Wales (company registration number [ number ]) with its registered office at ] [ address ] (Landlord) [ name of Tenant ] [ of OR incorporated in England and Wales (company registration number [ number ]) with its registered office at ] [ address ] (Tenant) [ [ name of Guarantor ] [ of OR incorporated in England and Wales (company registration number [ number ]) with its registered office at ] [ address ] (Guarantor) ] [ [ name of Mortgagee ] [ of OR incorporated in England and Wales (company registration number [ number ]) with its registered office at ] [ address ] (Mortgagee) ] Definitions Within this Deed, the terms below shall be interpreted as follows: [ Annual Rent • the annual sum reserved under the Lease; ] [ Insurance Rent • the Tenant’s share of the Landlord’s costs of insuring the Property (as set out in the Lease); ] Lease • the lease of the Property dated [ date ], entered into between (1) [ the Landlord OR [ name ...

Precedent Statutory Declaration: Standard Wording under the Statutory Declarations Act 1835

I, [ name ], of [ address ], solemnly and sincerely state that: [ Matters to be verified, set out in numbered paragraphs ] I make this solemn statement in good conscience, believing it to be true, and pursuant to the provisions of the Statutory Declarations Act 1835. DECLARED at [ details ] this [ day ] day of [ month and year ] Before me ................................................................................ [ signature of the person before whom the declaration is made ] A [ commissioner for oaths OR [ solicitor OR [ insert other qualification ] ] authorised to administer oaths ]...