Julie Palmer & Anor v Daniel Sans
[2024] EWHC 2685 (Ch)
Amanda Wade & Anor v Mohinder Singh & Ors
24 May 2024
[2024] EWHC 1203 (Ch)
High Court
A company's liquidators sued a family to sell their house to repay a debt. The family claimed the house belonged to one member, but the judge ruled it was jointly owned, as the attempt to hide the house from creditors was illegal. The house will be sold to pay the debt.
Key Facts
- •MSD Cash & Carry plc went into liquidation in 2012.
- •Mohinder and Surjit Singh were found liable for misfeasance, resulting in a £996,494.61 judgment debt.
- •Charging orders were sought over properties owned by Mohinder, Surjit, and Raminder Deol.
- •A 'Declaration of Trust' was presented, claiming Raminder was the sole beneficial owner of The Oaks property.
- •The liquidators challenged the Declaration, alleging it was a sham or a transaction defrauding creditors.
Legal Principles
Charging Orders
Part 8 of the CPR
Transactions defrauding creditors
Section 423 of the Insolvency Act 1986
Sham transactions
Snook v London and West Riding Investments Ltd [1967] 2 QB 786
Express trusts and the Law of Property Act 1925
Section 53(1)(b) of the Law of Property Act 1925
Common intention constructive trusts
Grant v Edwards [1986] Ch 638, Lloyds Bank plc v Rosset [1991] 1 AC 107, Stack v Dowden, Jones v Kernott, Amin v Amin [2020] EWHC 2675 (Ch)
Resulting trusts and presumption of advancement
Lewin on Trusts, Wood v Watkin [2019] EWHC 1311 (Ch), Wodzicki v Wodzicki [2017] EWCA Civ 95, Laskar v Laskar [2008] EWCA Civ 347
Admissibility of previous judgments
Hollington v Hewthorn [1943] 1 KB 587
Relief from Sanctions
Denton v TH White Ltd [2014] 1 WLR 3926
Defective Witness Statements
Practice Direction 32, paragraph 20.1, 23.2, Correia v Williams [2023] 1 WLR 767
Outcomes
The Declaration of Trust was set aside.
The court found the Declaration was a transaction at an undervalue under s.423 IA 1986, entered into by Mohinder for the purpose of putting assets beyond the reach of creditors.
The Oaks property is jointly owned beneficially by Mohinder and Raminder in equal shares.
The court rejected the Defendants' arguments for an express trust or common intention constructive trust. The evidence showed Mohinder's significant contribution to both the purchase and development, inconsistent with the claim that Raminder was the sole beneficial owner.
Further hearing to determine orders for sale and costs.
Consequential matters arising from the judgment required a separate hearing.