In the matter of Nicholas Mark Jones
[2023] EWHC 1359 (Ch)
Lee Jones v Aston Risk Management Ltd
10 October 2024
[2024] EWHC 2553 (Ch)
High Court
A company sued someone for a lot of money and won. The company wants to make the person bankrupt, but they live abroad. The court said the company couldn't make the person bankrupt because they didn't show they were doing business in the UK. The court also paused, but didn't dismiss, the person's attempts to block the bankruptcy process.
Key Facts
- •Lee Jones (Applicant) owes Aston Risk Management Ltd (Respondent) £1,661,483.27 plus costs.
- •Aston served two statutory demands on Jones.
- •Jones applied to set aside the statutory demands and sought an anti-suit injunction to prevent Aston from petitioning for bankruptcy.
- •Aston sought permission to serve bankruptcy proceedings on Jones in Guernsey.
- •The main issue was whether Jones carried on business in England and Wales within 3 years of the potential bankruptcy petition, satisfying the jurisdictional requirements of s. 265 IA 1986.
Legal Principles
Jurisdictional conditions for bankruptcy petitions are set out in s. 265(1) and (2) IA 1986.
Insolvency Act 1986
On an application to set aside a statutory demand, the court generally cannot consider jurisdictional challenges; the appropriate remedy is an anti-suit injunction.
Lyons v Bridging Finance [2023] EWHC 1235 (Ch)
To serve bankruptcy proceedings out of the jurisdiction, the claimant must show a good arguable case that the claim falls within a jurisdictional head (here, s. 265 IA 1986), a serious issue to be tried, and that England is the appropriate forum.
CPR Part 6, PD 6B, and case law
Carrying on business for s. 265(2)(b)(ii) IA 1986 requires considering the debtor's actions, timing, and whether it amounted to carrying on a business; merely being a director/shareholder is insufficient; but a separate business can be found if a director is conducting additional activity beyond their company role.
Case law including In re Brauch, re A Debtor (No.784 of 1991), Anglo Irish Bank Corp Ltd v Flannery, etc.
Outcomes
Jones' applications to set aside the statutory demands were stayed, not dismissed, to avoid conflict with r. 10.5(8) IR 2016.
Dismissal would trigger a mandatory order to authorise a bankruptcy petition, despite the court finding no arguable case for jurisdiction.
Jones' application for an anti-suit injunction was dismissed.
The stay on the set-aside applications, coupled with the dismissal of the service-out application, effectively prevents Aston from pursuing bankruptcy proceedings.
Aston's application for permission to serve out of the jurisdiction was dismissed.
Aston failed to demonstrate a good arguable case that Jones carried on business in England and Wales within the relevant period under s. 265(2)(b)(ii) IA 1986.
Similar Cases
Anthony James Broom v Maria Del Pilar Molina Aguilar
[2024] EWHC 1764 (Ch)
Anthony James Broom v Maria Del Pilar Molina Aguilar (Costs)
[2024] EWHC 1961 (Ch)
Marcellus Adrianus Antonius Kooter v The Official Receiver & Ors
[2023] EWHC 594 (Ch)
Dr Tanal Mohamed Sabbah v Barbel Christa Abela
[2024] EWHC 1790 (Ch)