Jurisdiction(s):
United Kingdom

Bhundia v Dhar: High Court (ChD) finds material irregularity in CVL vote; strict approach to proof admission; construction adjudication not final—res judicata and merger rejected (England and Wales)

Published on: 07 July 2025

Published by a LexisNexis Restructuring & Insolvency expert

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Article summary

Bhundia v Dhar [2025] EWHC 1227 (Ch) What are the practical implications of this case?

The judgment underscores the standard expected of chairs of creditors’ meetings when assessing proofs of debt. A finding of material irregularity showed the original liquidator’s appointment was defective: Mr Bhundia’s proof was not admitted to vote for the correct amount, and Mr Dhar’s vote was accepted when it should not have been. Accordingly, those presiding as chair (including directors or insolvency practitioners) must verify all claims, since their determinations are vulnerable to the court forming its own conclusion on the balance of probabilities if a challenge is brought. Errors can unravel the outcome of the meeting, requiring a fresh decision procedure.

Secondly, the decision clarifies the limited finality of construction adjudication awards in an insolvency setting. The court firmly rejected Mr Dhar’s reliance on res judicata and merger, concluding that an adjudicator’s award is not final and does not extinguish other, separate claims (such as overpayments or items not supplied) arising under the same contract. As a result, creditors are not prevented from advancing new, distinct claims in liquidation proceedings, even where they have previously pursued narrower adjudications. This accords with the ‘commonplace’ practice of...

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