[2007]JRC052
royal court
(Samedi Division)
1st March 2007
Before : |
Sir Philip Bailhache Kt., Bailiff, and Jurats de Veulle and King. |
Between |
Jersey Financial Services Commission |
Applicant |
|
|
|
And |
Alternate Insurance Services Limited |
Respondent |
In the matter of Article 155 of the Companies Act (Jersey) Law, 1991, as amended
Advocate A. D. Hoy for the Applicant.
The Respondent was not represented in this hearing.
judgment
the bailiff:
1. This is an application by the Jersey Financial Services Commission for a winding up of Alternate Insurance Services Limited ("Alternate") pursuant to Article 155 of the Companies (Jersey) Law 1991. The application has been made at short notice, time for serving the summons having been abridged by Order of the Bailiff.
2. The summons has been served upon the former legal advisers of Alternate and they have indicated to counsel for the Commission that the summons has been passed on to Mr Douglas Clark, who is the sole director and one of the two beneficial owners of Alternate.
3. Mr Clark has indeed indicated to counsel for the Commission that he has received the summons and that he has chosen not to attend this hearing.
4. The brief history of the matter is that the Commission brought proceedings against Alternate and others in relation to gross breaches of duty and the making of reckless statements concerning certain financial products which were offered to investors. After a lengthy hearing judgment was given in favour of the Commission in the sum of £1,564,128.56. This sum fell immediately due and formal demand for payment has been made.
5. Alternate has failed to pay the sum due, or any part of it, and it is an inescapable inference, and we so find, that Alternate is insolvent and unable to pay its debts as they fall due.
6. The matter which has precipitated this application is that Alternate was insured against breaches of duty, amongst other matters, and Alternate's insurers have sought to avoid responsibility under that policy. Proceedings have been issued before the High Court in England by the insurers seeking declaratory relief against Alternate to the effect that they are not liable to indemnify Alternate in respect of the judgment entered by this Court.
7. The Commission considers it appropriate to pursue Alternate's insurers in an attempt to force recovery in respect of the moneys due to the Commission for the benefit of the investors concerned.
8. There are essentially two methods where by a person can pursue an insolvent company in these circumstances. The first remedy would be to seek a declaration en désastre which would place the Viscount in the position of responsibility for the administration of the affairs of Alternate. Any action by the Viscount would have to be funded at public expense.
9. The second method is to seek an order under Article 155 which would authorise liquidators to pursue the interests of the creditors of Alternate. The liquidators would be paid by the applicant i.e. the Commission. We agree with counsel for the Commission that the appropriate remedy in these circumstances is an order under Article 155 of the Companies Law.
10. We, therefore, make the order that Alternate be wound-up on the grounds that it is just and equitable to do so and we appoint Gregory John Branch and Nicola Anne Robinson as liquidators of the Company.
11. I order that the costs of this application be paid as an expense of the liquidation.
Authorities
Companies (Jersey) Law 1991.