Key Facts
- •Wifime Ltd was wound up on 23 January 2017.
- •Azam Iqbal Haq was the sole director and shareholder.
- •The Official Receiver (OR) sought summary judgment against Mr. Haq and default judgment against his spouse, Tamina Azad.
- •Claims included unpaid salary, payments to Tamina Azad, and an outstanding director's loan account.
- •Mr. Haq appeared in person; Ms. Azad did not attend.
- •The OR discontinued the claim against Ms. Azad.
Legal Principles
Summary judgment can be granted if the respondent has no real prospect of succeeding and there is no other compelling reason for a trial.
CPR 24.3
In summary judgment applications, the court must consider whether the respondent's case has a realistic prospect of success, not conduct a 'mini-trial'. If a short point of law is involved and the court has sufficient evidence, it should decide it.
Global Asset Capital Inc v Aabar Block SARL [2017] EWCA Civ 37
If the applicant provides credible evidence, the burden shifts to the respondent to show a real prospect of success.
Punjab National Bank (International) Limited v Techtrek India Limited [2020] EWHC 539 (Ch)
The court can evaluate evidence and conclude there's no real prospect of success without conducting a mini-trial.
BFS Group Limited v Foley [2017] EWHC 2799 (QB) and King v Stiefel & Others [2021] EWHC 1045 (Comm)
There must be a contractual entitlement to receive remuneration, including salary.
Hamuel Reichernbacher Limited v McDermott [2022] EWHC 623 (Ch)
Regulation 82 of Table A allows directors' remuneration as determined by ordinary resolution.
Regulation 82 of Table A, Companies Act 1985, section 8
Payments made in breach of directors' duties (sections 171, 172, and 174 of the Companies Act 2006) can be recovered.
Companies Act 2006, sections 171, 172, 174
Outcomes
Summary judgment for the OR on the Salary Claim was not granted.
Mr. Haq's salary payments were recorded in the company accounts, and the OR accepted further argument was needed regarding the Duomatic principle.
Summary judgment for the OR on the Payments Claims was not granted.
Mr. Haq provided evidence suggesting that some payments were for expenses or salary (already accounted for), requiring further investigation to avoid double counting and clarify the purpose of the remaining payments.
Summary judgment for the OR on the DLA Claim was not granted.
Mr. Haq claimed to have repaid the outstanding amount and provided some evidence of payments into the company account, raising questions of double counting with other claims.
The claims against Mr. Haq will proceed to trial.
The court found that there were unresolved factual issues and further evidence was needed on all three claims.