Bridger & Co Limited v Specialist Lending Limited (t/a Duologi)
[2023] EWHC 2562 (Ch)
Time GB Group Limited v Yarwell Mill Country Park Limited
28 July 2023
[2023] EWHC 1887 (Ch)
High Court
A company (Time GB) didn't pay another company (Yarwell) and Yarwell wanted to shut them down. Time GB tried to stop Yarwell, claiming Yarwell had acted badly and that they didn't owe as much money. The judge didn't believe Time GB's excuses and said Yarwell could continue with the shutdown process because Time GB couldn't prove they weren't at fault or didn't owe the money.
Key Facts
- •Time GB Group Limited (Applicant) failed to pay £2.37m to Yarwell Mill Country Park Limited (Respondent) by the due date stated in a promissory note.
- •The Respondent served a statutory demand and presented a winding-up petition.
- •The Applicant disputed the debt amount and alleged misconduct by the Respondent's former director, Mr. Crickmore.
- •The Applicant's allegations included interference with financing brokers and disclosure of confidential information.
- •The Applicant filed an application to restrain the presentation and advertisement of the winding-up petition.
- •The Applicant did not serve the application to restrain presentation before the petition was presented.
Legal Principles
The court will restrain a winding-up petition if it's an abuse of process or bound to fail; if the debt is disputed on substantial grounds; or if there's a substantial cross-claim.
Coilcolour v Camtrex [2015] EWHC 3202
The threshold for disputing a debt on substantial grounds is not high, even if a defence would be considered 'shadowy' in a summary judgment.
Tallington Lakes v South Kesteven District Council [2012] EWCA Civ 443
A genuine dispute on substantial grounds is required to restrain a petition based on a disputed debt. The court assesses whether there is substance in the dispute.
Tallington Lakes Ltd v Ancasta International Boat Sales Ltd [2014] BCC 327; Re a Company (No 00685 of 1996) [1997] BCC 830
Restraining advertisement requires evidence of a threatened abuse of process.
James Dolman & Co v Pedley [2004] BCC 504
Advertisement of a winding-up petition serves to notify those entitled to be heard and those who might trade with the company.
In Re a Company (No 007923 of 1994)
A promissory note is a negotiable instrument; a term of good faith is implied into a contract only in limited circumstances, particularly 'relational' contracts.
Bills of Exchange Act 1882, ss. 83, 88, 89; Chitty on Contracts, 34th edition [36-004]; Candey Ltd v Bosheh [2022] 4 WLR 84
The court may reject inherently implausible evidence or evidence contradicted by documents.
Ashworth v Newnote [2007] EWCA Civ 793
Outcomes
The application to strike out or restrain advertisement of the winding-up petition was dismissed.
The Applicant failed to demonstrate genuine substantial grounds for disputing the debt or a genuine arguable cross-claim of sufficient value. The Applicant's allegations of misconduct were unsubstantiated and did not meet the legal threshold for a dispute of substantial grounds. The court found the Applicant's evidence on solvency to be inaccurate and misleading.