Lending Group Limited & Anor v LVR Capital Ltd & Anor
[2023] EWHC 2509 (Ch)
In the matter of Rodus Developments Limited (in administration)
20 December 2022
[2022] EWHC 3232 (Ch)
High Court
A company tried to claim money from a bankrupt company's property but forgot to file the paperwork correctly. A judge ruled that the claim was invalid, essentially stopping the company from claiming the property.
Key Facts
- •Rodus Developments Limited (the Company) was in administration.
- •Actua Investment LLC (Actua) claimed an equitable charge over the Company's properties based on a loan agreement.
- •The charge was unregistered, violating section 859H of the Companies Act 2006.
- •Actua filed an application (UN1 Application) at HM Land Registry for a unilateral notice.
- •The Joint Administrators sought to prevent the registration and obtain a declaration that the charge was void.
- •Actua failed to respond to correspondence and attempts at service.
- •The unregistered charge was preventing the sale of properties and distribution to creditors.
Legal Principles
Service out of the jurisdiction
CPR Part 6, Schedule 4 to the Insolvency Rules 2016
Validity of unregistered charges
Companies Act 2006, Part 25
Power of the court to order withdrawal of unilateral notice application
LRA 2002 s.77, Inherent Jurisdiction of the High Court
Alternative methods of service
CPR 6.15, Schedule 4, para 1(5) Insolvency Rules 2016
Jurisdiction clause
Clause 21 of the Actua Facility Agreement
Priority of charges
Eason v Wong [2017] EWHC 209 (Ch)
Outcomes
Permission granted to serve Actua out of the jurisdiction.
The court found that the gateways for service out were met, there were reasonable prospects of success, and England was the proper place to bring the claim.
Declaration that Actua's equitable charge was void for non-registration.
The charge was not registered within the time limit set by the Companies Act 2006.
Order cancelling Actua's application to HM Land Registry.
Actua had no valid interest to protect, and the application was prejudicing the administration.
Order for alternative service on Actua via its solicitors.
It was considered impracticable to serve Actua directly, and its solicitors had been involved in the matter and had received ample notice.
Paragraph 71 Application stayed pending further order.
Substantive relief was not required given the outcome of the Paragraph 63 Application.
Actua ordered to pay the Joint Administrators' costs.
The costs could have been avoided if Actua had withdrawn its application.
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