Legal News

Lexham Securities Ltd and another v Earlsfort Capital Partners Ltd and others [2023] EWHC 909 ( Ch) What are the practical implications of this case? This decision confirms that a mortgagor may still exercise the equity of redemption even after a receiver has concluded a contract on their behalf. Historically, it has been accepted that the equity of redemption is, for a period, put on hold between the making of a sale contract by the mortgagee and the subsequent completion of that contract (see Property and Bloodstock Ltd v Emerton [1968] Ch. 94). The situation is, in practice, different where the sale contract is made by a receiver. Although the receiver is appointed by the mortgagee, the receiver acts as the owner/mortgagor’s agent, not the mortgagee’s. That almost invariably follows from the provisions of the original loan agreement; agreed at the outset, at a time when the...

Snoozebox Ltd v Health and Safety Executive and another [2023] EWHC 851 ( Ch) What are the practical implications of this case? The immediate takeaway is that, where uncertainty exists, creditors should lodge a proof in a CVA upon receiving notice, or at the very least engage with the CVA nominees ahead of the vote. The central difficulty for the Crown— HSE being treated as its emanation—was its non-participation in the CVA. As its inquiries had not concluded at that stage, it is unsurprising the HSE did not regard the contingent liability as sufficiently concrete to justify taking part. Indeed, attempting to quantify a prospective fine before any inquest would appear counter-intuitive to most prosecutors. Set against that, the judgment underscores the expansive modern scope of provable contingent debts, particularly following Re Nortel Gmb H [2013] UKSC 52. The more...

David Mc Clean and others v Andrew Thornhill KC [2023] EWCA Civ 466 The appellants belonged to limited liability partnerships ( LLPs) established specifically to obtain and exploit distribution rights in films. Prospective investors were pitched the Scheme by the promoter, as presented on the footing that, as members of an LLP, they would qualify for tax relief on trading losses the LLP was expected to incur, which they could set off against their own personal income or capital gains, thereby reducing their tax liabilities. The Scheme’s promoter retained Mr Thornhill to produce a series of opinions addressing the tax consequences of the arrangements. HMRC disputed the supposed purported fiscal advantages of investing in or participating in the Scheme, contending the LLPs were not conducting trade on a commercial footing with an intention to make a profit. In 2017 the investors concluded a...

Re Avanti Communications Ltd [2023] EWHC 940 ( Ch) This marks the first substantial judgment on the divide between fixed and floating charges since the House of Lords’ landmark ruling in Re Spectrum Plus [2005] UKHL 41, which reclassified an apparent fixed charge over book debts as floating because the chargor could freely deploy the charged assets and the security holder therefore lacked the requisite control to constitute a fixed charge. The designation of security as ‘fixed’ or ‘floating’ under English law now carries even greater weight given HMRC (the UK tax authority) ranks as a preferential creditor for certain taxes in insolvency—ie those taxes sit behind fixed charge realisations but ahead of floating charge realisations. That characterisation had a decisive effect on the order of payments in Avanti’s administration: as the charge was properly treated as fixed, the secured creditors recovered in full; had it...

The European Banking Authority ( EBA) has issued data concerning two significant concepts and indicators within the Deposit Guarantee Schemes Directive ( DGSD): available financial means ( AMFs) and covered deposits. The EBA releases this data for the deposit guarantee scheme ( DGS) in each individual member state annually......

Aston Risk Management Ltd v Jones and others [2023] EWHC 603 ( Ch) What are the practical implications of this case? Practitioners should be alert to these three core points: An individual can be treated as a company director even without a formal appointment. Whether that outcome arises turns on the extent of their involvement in day-to-day operations and their assumption of director-level functions. A so-called de facto director owes the same duties and faces the same liabilities as an officially appointed director. What as the background? The dispute concerned a subsidiary whose business was delivering audiology services. The company was first incorporated by CJ, who acted as its initial director. In time, CJ brought ML into the venture, and ML was also appointed as a director of the subsidiary. In 2014, the subsidiary and its owners attracted two new investors. The resulting investment structure comprised these...

Intricate tax planning may amount to confidential information, notwithstanding parallel arrangements by others ( Kieran Corrigan & Co Ltd v One E Group) Kieran Corrigan and Co Ltd v One E Group Ltd and others [2023] EWHC 649 ( Ch) (23 March 2023) What are the practical implications of this case? The ruling is indispensable reading for practitioners handling disputed confidentiality claims. The judge explored the nuanced considerations underpinning whether particular material is confidential, while also providing a crisp, thorough synopsis of the breach of confidence jurisprudence as a whole, beginning with the test in Coco v AN Clark ( Engineers) Ltd [1969] RPC 41. The discussion spans scenarios where products are already publicly available (yet secrecy is claimed in the design), where the confidential corpus blends ‘public’ with ‘private’ elements, and where numerous ‘public’ components are assembled to yield...

R ( Sandy) v Home Secretary [2023] EWHC 640 ( Admin) What are the practical implications of this case? Applicants should note that broad‑brush claims offer scant assistance in naturalisation applications. The particulars of any asylum claim should be reviewed with care, and material from that period augmented where necessary. The guidance sets an exacting bar for good character, so meticulous attention to its thresholds and the language employed is crucial. Of wider note is Mostyn J’s analysis of why he dismissed the claimant’s striking submission—summarised at paras [43]–[45]—that proportionality, rather than rationality, ought to be the operative test. For the principled foundations of the rationality standard in this sphere, see paras [25]–[33] and [38]–[42]. Ongoing attempts to invoke proportionality are likely to meet a frosty reception from the judiciary. As he remarks at para [47], within judicial review...

The Home Office has issued the government response in line with s72 Police, Crime, Sentencing and Courts Act 2022 ( PCSCA 2022) to recommendation eight......

R (on the application of Oceana) v Upper Tribunal ( Immigration and Asylum Chamber) [2023] EWHC 791 ( Admin) What are the practical implications of this case? Given the thorough consultation and investigation undertaken by the Independent Review of Administrative Law, it would have been unexpected if the Administrative Court had concluded that the meticulously framed ouster provisions were incapable of achieving their narrowly targeted aim. This ruling confirms it is exceptionally difficult to maintain that they are ineffective. It further underlines that the general jurisdictional gateway in TCEA 2007, s 11(4)—showing the UT acted ‘in such a procedurally defective way as amounts to a fundamental breach of the principles of natural justice’—poses a ‘substantial hurdle’ (at para [33]). Practitioners should note that this hurdle is usually cleared only where there is ‘a failure in process which is so grave as to rob the process of any...

Somoye (on his own behalf and as administrator of the estate of Oluyinka O Somoye) v North West Anglia NHS Foundation Trust [2023] EWHC 191 ( KB) What are the practical implications of this case? This judgment distils the key considerations guiding the court’s discretion when asked to allow a defendant to retract a pre-action admission of liability. It sets out the matters the court will weigh, offering a structured reminder of how such applications are approached in practice. The parties’ conduct, including any behaviour that prompted the admission in the first place The prejudice that may arise for either side if the admission is withdrawn, or if permission to withdraw is refused The likelihood of success (were the admission to be withdrawn) of the claim, or the relevant part of it to which the admission relates The outcome...

Dorey v Ashton [2023] GCA008. The facts The appellants were three of the four adult offspring of Sir Graham Dorey, a former Bailiff of Guernsey. In 2004, the respondent advocate prepared Wills of personalty and of realty for Sir Graham Dorey. Although he was known to have dementia, a consultant psychiatrist had concluded that he nevertheless retained testamentary capacity at the relevant time. The claimants disputed the circumstances in which those Wills were executed. Absent the Wills, the children would have taken 100% of Sir Graham’s estate on intestacy, because a pre-nuptial agreement between Sir Graham and his second wife, their stepmother, contained a disclaimer of any claim to the estate while expressly allowing Wills to be made. Under the Wills, a share of Sir Graham’s estate was directed to his second wife under those instruments. Sir Graham died in 2015. All four...

QIC Europe Ltd QIC Europe Ltd, a Malta-based insurer, rejects claims it breached its policy with two subsidiaries of hospitality group C G Restaurants ( Holdings) Ltd by declining to indemnify losses tied to three government-imposed lockdowns from September 2020 to December 2021. According to its defence at the High Court, filed on 24 March 2023 and now made public, cocktail bar operator DC Bars Ltd and Tuttons Brasserie Ltd, which operates a restaurant in Covent Garden, central London, benefit from cover only for the first lockdown, which began in March 2020. The insurer maintains no liability for the later closures. The hospitality companies......

The Information Commissioner’s Office ( ICO) imposed a £12.7m penalty on Tik Tok Information Technologies UK Limited and Tik Tok Inc ( Tik Tok) for violations of the UK’s General Data Protection Regulation, Retained Regulation ( EU) 2016/679 ( UK GDPR), including not handling children’s personal data lawfully. The ICO estimates in 2020 Tik Tok permitted up to 1.4m UK children under......

Re P (a child) (fair hearing) [2023] EWCA Civ 215, [2023] All ER ( D) 11 ( Mar) What are the practical implications of this case? Practitioners should acquaint themselves with the principles articulated by Lord Justice Peter Jackson from para [42] onwards of this judgment, where the Court of Appeal set out how adjournment requests should be approached to ensure proceedings are ‘fair’. Those principles are liable to apply across proceedings under the Children Act 1989 ( Ch A 1989) and the Adoption and Children Act 2002. Where an adjournment is sought, para [46] confirms that fairness is the essential touchstone, and the weight to assign to any given proposition or other pertinent consideration is for the court’s judgement in the individual case. The propositions gathered at para [45] provide a non-exhaustive, yet very useful, suite of factors that a court may weigh when...

The European Securities and Markets Authority ( ESMA) has released a public notice tackling investor protection issues stemming from derivatives linked to fractional shares. It clearly underscores that such derivatives are not company shares, and, as a result, firms ought not to employ......

Re The Whitehall Partnership Ltd [2023] EWHC 596 ( Ch), [2023] All ER ( D) 61 ( Mar) What are the practical implications of this case? The decision offers analysis of the court’s overall method when considering whether to make a winding‑up order on just and equitable grounds, together with the additional requirements in IA 1986, s 125(2) applied when deciding a contributory’s petition for such an order. It also addresses the allocation of the burden of proof under that sub‑section. On the broader issue of just and equitable winding up, the judge examined what it means where responsibility for the breakdown of the relationship lies with one or both participants. He stated that the court is unlikely to exercise its discretion in favour of a petitioner who is wholly, or to a large extent, the author of that breakdown. The judge further...

Soriano v Forensic News LLC and others [2023] EWCA Civ 223 What are the practical implications of this case? The English courts may grant an anti-suit injunction to restrain overseas proceedings where a party acts unreasonably. Yet they will not usually exercise that discretion where the foreign claimant is lawfully seeking documents they say they need for their claim. That holds even if the relief pursued abroad is broader than an English court would typically order. Though the dispute concerned defamation, the guidance reaches beyond that field. The Court of Appeal essentially affirmed support for legitimate evidence-gathering and is slow to conclude that recourse to foreign processes to obtain evidence is oppressive. What was the background? The appellant holds both British and Israeli nationality, has lived in the UK since 2003, and became a British citizen in 2009. He issued libel claims against a number of...

High Court defence In its High Court defence, the insurer maintains it does not owe Aer Cap Ireland Ltd for the value of 141 aircraft and 29 engines leased to Russian airlines and now marooned in the country. Swiss Re International SE has joined peers AIG Europe SA and Lloyd’s Insurance Co. SA in asserting it bears no liability because Aer Cap could, in time, recover the aircraft and parts from the country. They argue their policies respond only to a total physical loss of the planes. Possible retrieval would, they say, fall outside that scope. Another insurer, Fidelis Insurance Ireland DAC, entered the proceedings as a defendant in January 2023. Swiss Re also used its defence, filed on 13 March 2023 and since made public, to set out its position clearly and mark a firm boundary: it would be liable solely to the extent of its...

Bastholm and others v Peveril Securities ( Dalton Park Retail) Ltd and others [2023] EWHC 438 ( Ch) Background The dispute concerned a demand for overage under a Payment Deed connected to the creation of a large designer outlet and retail centre at Dalton Park, County Durham. The Deed identified the ‘ Seller’ as five named individuals and set out a valuation process by expert determination, to be initiated by an application to the Royal Institution of Chartered Surveyors ( RICS). In 2014, those five applied to RICS seeking the appointment of an expert to assess the value of development said to have occurred in 2002. By that time, one of the five had been adjudged bankrupt and later discharged, and his Trustee in Bankruptcy was not included in the approach to RICS. The first defendant, who owned the relevant land, contended that the...