Jurisdiction(s):
United Kingdom

Main v SpaDental: EAT holds unpaid holiday pay claims vest in bankruptcy estate; proprietary not personal; wide IA 1986 s436; tribunal must consider interest-like compensation for delay

Published on: 23 January 2025

Published by a LexisNexis Restructuring & Insolvency expert

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Article summary

Main v Spadental Ltd and another [2024] EAT 200

What are the practical implications of this case?

The decision will interest practitioners working in insolvency and employment. On the vesting of claims, it confirms the broad scope of section 436 of the Insolvency Act 1986 regarding what counts as property. A chose in action can pass to a trustee in bankruptcy even where, at that point or in those circumstances, the bankrupt is not yet able to enforce it. The EAT also indicated that the nature of the remedy pursued is pivotal in deciding whether a claim is personal or proprietary, and that the legislative policy aims behind the cause of action carry less weight than the character of the remedy itself. Trustees of bankrupt estates will be reassured that employment claims where the cause of action includes at least a failure to pay wages, and where the relief is quantified solely by reference to the worker’s rate of pay, are not treated as ‘personal’ claims of the sort identified in the relevant authorities, including Heath v Tang [1993] 1...

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