Mohammad Razi Khan v Arvinder Singh-Sall & Anor
[2023] EWCA Civ 1119
Ramesh Philippe Dusoruth v Orca Finance UK Limited (in liquidation)
18 April 2023
[2023] EWHC 1050 (Ch)
High Court
Someone went bankrupt because of a debt that wasn't clearly defined. Even though the judge agreed the debt was wrongly stated, he still let the bankruptcy stand because he had the power to, considering the interests of other creditors.
Key Facts
- •Renewed application for permission to appeal orders of ICC Judge Mullen (16 September 2022 & 3 November 2022).
- •Judge Mullen refused to annul a bankruptcy order despite finding the debt was not liquidated.
- •Appellant argued the bankruptcy order was made without jurisdiction because the debt was not liquidated.
- •The debt was for misappropriated funds, described as liquidated in the petition.
- •Judge Mullen found the debt was not liquidated, relying on Hope v Premierpace [1999] BPIR 695.
Legal Principles
A creditor's petition requires a liquidated debt (Insolvency Act 1986, s.267(2)(b)).
Insolvency Act 1986, s.267(2)(b)
The court may annul a bankruptcy order if it appears the order ought not to have been made (Insolvency Act 1986, s.282(1)(a)).
Insolvency Act 1986, s.282(1)(a)
The court has discretion to annul a bankruptcy order, even if grounds exist, considering factors like creditor's conduct and debtor's prospects of paying (Owo-Samson v Barclays Bank [2003] EWCA Civ 714).
Owo-Samson v Barclays Bank [2003] EWCA Civ 714
Where an order is made without jurisdiction, the court will usually set it aside; however, this principle may be qualified by statute (Raiffeisenlandesbank Oberösterreich AG v Meyden [2016] EWHC 413 (Ch)).
Raiffeisenlandesbank Oberösterreich AG v Meyden [2016] EWHC 413 (Ch)
A claim for return of misappropriated monies is not a liquidated debt (Hope v Premierpace [1999] BPIR 695).
Hope v Premierpace [1999] BPIR 695
Outcomes
Permission to appeal dismissed.
Owo-Samson is binding authority; the court has discretion under section 282 to annul even if section 267(2)(b) requirements aren't met. The judge correctly exercised his discretion.