BUSINESS AND PROPERTY COURT OF ENGLAND AND WALES
ON APPEAL FROM DISTRICT JUDGE MATTHEWS IN THE COUNTY COURT AT PETERBOROUGH
AND IN THE MATTER OF THE INSOLVENCY ACT 1986
Fetter Lane, London, EC4A 1NL |
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B e f o r e :
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(1) SANDRA RENE LYGOE (2) NICHOLAS LYGOE (3) LEXOCO LIMITED |
Appellants |
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- and STEPHEN JOHN HUNT |
Respondent |
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Mr James Pickering (instructed by Summit Law LLP) for the Respondent
Hearing dates: 12th February 2019
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Crown Copyright ©
Mr Justice Mann :
1. A declaration that the 2003 transfer of Victoria House was a transaction defrauding creditors pursuant to section 423 of the 1986 Act.
2. An order that the payment of the entirety of the net proceeds of sale of Victoria House to the wife also amounts to a transaction defrauding creditors pursuant to section 423.
3. Further or alternatively, a declaration that the payment of £250,806.18 to the wife amounts to a transaction defrauding creditors. (This is that part of the proceeds of sale of Victoria House retained by Mrs Lygoe after the payment of £230,000 to Lexoco).
"4. That the payment to Lexoco Ltd of the sum of £230,000 also amounts to a transaction defrauding creditors (or alternatively a TUV) such that Lexoco ought to be ordered to repay the above sum to the bankruptcy estate (and/or the Second Respondent ought to be ordered to repay that sum on the ground of dishonest assistance) and/or such other relief as the court thinks fit."
I have set at paragraph 4 verbatim because its precise terms are capable of being relevant to this appeal.
"(2) the subsequent dissipation of the net proceeds of sale of Victoria House under the transaction defrauding creditors provisions in section 423 of the IA 1986 (or alternatively under the TUV provisions contained in section 339 of the IA 1986 and/or on the ground of dishonest assistance)"
"66. Further, in that event, it would follow that the sum of £230,000 ought then to be recoverable from Lexoco and the transaction defrauding creditors provisions (or alternatively under the TUV provisions) and/or from the Second Respondent as its sole registered director on the ground of dishonest assistance."
"67. In short, therefore, if the District Judge's reasoning and findings are accepted (which I believe they should) it would inevitably follow that the whole series of arrangements set out above where a sham designed with a view to putting assets beyond the reach of the Bankrupt's creditors and/or prejudicing their interests. In those circumstances, I am advised and believe, the transferred sum of £230,000 ought to be recoverable from Lexoco as the recipient of those funds and/or from the Second Respondent as the person who procured and/or permitted (and thereby dishonestly assisted) the same."
"8. These are allegations, and I do not doubt that the passion with which Mr Nicholas Lygoe disputes the allegations, but I am not going to allow his application today to strike at paragraph 4 of the application notice or indeed to give summary judgement in his favour in respect of that paragraph. This is the first hearing of the Trustee in Bankruptcy's claim and, having considered carefully all of the submissions that had been made to me today, I do consider that it is premature for there to be a summary disposal of these very serious matters. What I'm going to do is to direct that there should be full and formal pleadings of the claim that the applicant must set out in detailed particulars of claim in its case against the Second Respondent and I would then anticipate the usual directions for the filing of a defence and a reply to the defence."
"4A [An order] That the payment by Lexoco to Maplehorne Limited of the sum of hundred and £148,000 amounted to a breach of trust in respect of which the Second Respondent dishonestly assisted and/or that payment amounted to an unlawful means conspiracy in respect of which the Second Respondent was a participant and accordingly the Second Respondent is liable to pay the above or such other sum as the court thinks fit."
"17.4(2) The court may allow an amendment whose effect will be to add or substitute a new claim, but only if the new claim arises out of the same facts or substantially the same facts as a claim in respect of which the party applying for permission has already claimed a remedy in the proceedings."