Before : |
J. A. Clyde-Smith, Esq, Commissioner, and Jurats Fisher and Grime |
IN THE MATTER OF THE REPRESENTATION OF INVESTEC BANK PLC
AND IN THE MATTER OF DEANSGATE MANCHESTER LIMITED (DISSOLVED), DEANSGATE JERRSEY NO. 1 LIMITED (DISSOLVED) AND DEANSGATE NO. 2 LIMITED (DISSOLVED)
AND IN THE MATTER OF ARTICLES 155 AND 213 OF THE COMPANIES (JERSEY) LAW 1991
Advocate J. Garrood for the Representor.
Advocate S. C. Thomas appeared on behalf of Mr Ahron Frenkel and Mr Yoram Yossifoff as shareholders.
judgment
the commissioner:
1. The representor Investec Bank PLC seeks to have the dissolution of three companies set aside pursuant to Article 213 of the Companies (Jersey) Law 1991, namely Deansgate Manchester Limited (Dissolved), Deansgate Jersey No 1 Limited (Dissolved) and Deansgate Jersey No 2 Limited (Dissolved) ("the companies").
2. The companies were dissolved and removed from the Register of Companies as a result of a failure to file any returns and pay associated fees. Together the companies formed part of the structure of a Jersey limited partnership known as the Deansgate Limited Partnership. The representor asserts that by an assignment, it is the lawful creditor of the partnership and of the companies in the sum of just under £83 Million, the assets of which comprise parcels of land in the UK known as the Deansgate Centre, Manchester, presently sublet to House of Fraser (Stores) Limited and House of Fraser Limited and valued at some £80.5 Million. The effect of the dissolution of these companies, it says, is to hold the representor out of its rights under the security agreements.
3. Turning to relevant legal framework the Court's jurisdiction to declare as being void the dissolution of the companies arises under Article 213(1) of the Companies (Jersey) Law 1991 which provides:-
"Where a company has been dissolved under this Law or the Désastre Law, the court may at any time within 10 years of the date of the dissolution, on an application made for the purpose by -
(a) a liquidator of the company; or
(b) any other person appearing to the court to be interested,
make an order, on such terms as the court thinks fit, declaring the dissolution to have been void and the court may by the order give such directions and make such provisions as seem just for placing the company and all other persons in the same position as nearly as may be as if the company had not been dissolved.
4. The threshold test of whether a person is sufficiently interested is not onerous and an applicant needs to show no more than a shadowy interest (see In the matter of Independent Marine Services Limited [1996] JLR 294). Generally the courts should not exercise its discretion to declare a dissolution void unless it is satisfied the company arguably should not have been dissolved and/or there is a cause for it to be restored (as per Independent Marine Services Limited). The court has recently recognised that the jurisdiction conferred by Article 213 has a practical purpose and should be used in a pragmatic way (see In the matter of Northern Investments (Wrexham) Limited [2015] JRC 207).
5. Upon reinstatement it is the intention of the representor to apply to have the companies wound up under Article 155 of the Companies (Jersey) Law 1991 and for the appointment of a liquidator and this as an alternative to asking for a letter of request to be sent to the High Court for the appointment of English receivers, ensuring that this remains a Jersey-cited process and we understand that the 7th of January, 2016, has been fixed for that application.
6. Notice of this application has been given by email and post to the interested parties as set out in the Act of court of 2nd October, 2015. Advocate Thomas, who represents Mr Yossisoff and Mr Frenkel, in their capacity as the ultimate beneficial owners of the companies sought to be restored to the register, has no objection to the orders that are being sought.
7. The representor has undertaken that it will pay all outstanding sums due to the Registrar of Companies by way of fees, penalties, interests and costs as a condition of the companies being restored. The representor will also pay any sums due to the Comptroller of Income Tax, although no liability is expected. Although insolvent, the companies have assets left undistributed and liabilities left unsettled, and reinstatement will ultimately provide a mechanism for them to be wound up in a proper and orderly fashion.
8. We therefore grant the application and make the orders set out in the draft minute and order at tab C of the bundle, noting the undertakings given in the affidavit of Mr Michael Nurtman at paragraphs 24 and 25.
9. In terms of costs I do not regard the conduct of Mr Youssisoff and Mr Frenkel as being unreasonable and I decline to make an order for costs.
Authorities
Companies (Jersey) Law 1991.
In the matter of Independent Marine Services Limited [1996] JLR 294.
In the matter of Northern Investments (Wrexham) Limited [2015] JRC 207.