TCPC Management Limited v Windrush Alliance UK Community Interest Company
[2024] EWHC 809 (Ch)
Parrot Pay Limited (in liquidation) v Goddington Pierce Limited (in provisional liquidation)
24 October 2023
[2023] EWHC 2774 (Ch)
High Court
A company (Parrot Pay) that ran a temp agency said another company (Goddington Pierce) owed them a lot of money because of a scheme where bonuses weren't properly taxed. The court agreed and ordered Goddington Pierce to be shut down and its assets distributed to creditors. The court also chose who would manage this process.
Key Facts
- •Parrot Pay Ltd (in liquidation) applied to discharge the appointment of provisional liquidators of Goddington Pierce Ltd (in provisional liquidation) and strike out a winding-up petition.
- •Parrot Pay, acting as an employment agency, allegedly retained discretionary bonuses from employees, totaling nearly £5 million paid to Goddington Pierce.
- •Goddington Pierce initially opposed the application but later withdrew their opposition and consented to a winding-up order.
- •The court considered the withdrawal of an application, the winding-up petition, and the appointment of liquidators.
- •There were supporting creditors, including HMRC and Acorn BS Services Limited.
Legal Principles
The court has the power to permit the withdrawal of an application under CPR rule 3.1(2)(m) for managing the case and furthering the overriding objective.
CPR rule 3.1(2)(m)
A company can be wound up if it is unable to pay its debts (Insolvency Act 1986, section 124(1)(f)).
Insolvency Act 1986, section 124(1)(f)
The court can remove a liquidator from office and appoint a new one under section 172(2) of the Insolvency Act 1986.
Insolvency Act 1986, section 172(2)
Costs generally follow the event.
Rule 7.108(4)(h)
Expenses of provisional liquidation and remuneration of provisional liquidators are expenses of the liquidation (rule 7.108(4)(a)(i) and (f)).
Rule 7.108(4)(a)(i) and (f)
Outcomes
Goddington Pierce's application to discharge the provisional liquidation and strike out the winding-up petition was withdrawn.
Goddington Pierce consented to the winding-up order. The court held it had the power to allow the withdrawal of the application.
A winding-up order was made against Goddington Pierce.
Parrot Pay established a significant debt, and Goddington Pierce consented to the winding up. The court found sufficient grounds under the Insolvency Act 1986 for a winding-up order.
The Official Receiver was removed as liquidator, and the joint provisional liquidators (from Parrot Pay) were appointed as liquidators, along with a conflict liquidator.
All parties consented. Appointing the provisional liquidators saved time and cost; a conflict liquidator was deemed necessary given the complex history and potential for future disputes.
Costs of the petition, provisional liquidation application, and discharge application were awarded to Parrot Pay and to be paid by Goddington Pierce as expenses of the liquidation.
Costs followed the event, with no good reason to distinguish between the different stages of the proceedings.
The expenses of the provisional liquidation and remuneration of the provisional liquidators were to be paid as expenses of the liquidation.
This was in line with relevant rules.
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