Boris Franz Becker (A Bankrupt) v Mark Christopher Ford

Hearing dates: 24 February 2024

Approved Judgment

This judgment was handed down remotely at 10.00am on 1 May 2024 by circulation to the parties or their representatives by e-mail and by release to the National Archives.

CHIEF INSOLVENCY AND COMPANIES COURT JUDGE Briggs

Chief ICC Judge

Introduction

On 15 February 2024 the Applicant, a well-known professional tennis player, made an application to discharge an order made on 3 December 2018 (the “2018 Order”), pursuant to section 279(3) of the Insolvency Act 1986.

The Applicant was adjudged bankrupt by court order on 21 June 2017. By Section 279 of the 1986 Act, a bankrupt in England and Wales will be discharged automatically at the end of the period of one year beginning with the date on which the bankruptcy started.

The first and second Respondents were appointed joint trustees in bankruptcy of the Applicant on 21 August 2017.

Section 279(3) of the 1986 Act permits applications to be made by the official receiver or trustee-in-bankruptcy to suspend the running of time, to prevent automatic discharge at the end of the period of one year.

On 31 May 2018 the joint trustees made an application to suspend time from running pursuant to section 279(3) of the 1986 Act. An interim order was made on 18 June 2018 followed in December by the 2018 Order.

The effect of the 2018 Order was that Mr Becker would remain subject to the disabilities imposed as a consequence of the bankruptcy order until the suspension on the running of time lifted, and the expiry of the remainder of the one-year period of bankruptcy.

The Application

By the application dated 15 February 2024 (the “Application”) Mr Becker seeks:

“An order (compliant with r.10.143(11) of the 2016 Rules) discharging the order made under s.279(3) of the 1986 Act on 3 December 2018 that time ceased to run from that date for the purposes of s.279(1) of the 1986 Act.”

He further seeks a second order:

“… under r.12.39(9) of the 2016 Rules that the Settlement Deed dated 15 November 2023 entered into between the Applicant, the First and Second Respondents and another … must not be made available for inspection without the permission of the court.”

The joint trustees accede to the second order sought and positively ask for the same relief.

The 2018 Order made by Deputy Insolvency and Companies Court Judge Schaffer recites that an order for suspension was sought “on the grounds that he has failed and is failing to comply with his obligations under” the 1986 Act. The operative order states that:

“The relevant period for the purposes of section 279 of the Insolvency Act 1986 shall cease to run such that the Bankrupt shall not be discharged from bankruptcy:

(a) until the Applicants [the Trustees] certify to the Court that the Bankrupt has complied with his obligations under Part IX of the Insolvency Act 1986; or

(b) until the Court orders otherwise upon the application of either the Applicants or the Bankrupt.”

Since the making of the 2018 Order Mr Becker has been prosecuted for offences specified in the 1986 Act. The indictment contained 25 charges. He was found guilty of 4 and sentenced to serve 18 months in prison in April 2022. He served a truncated term and was deported from the UK on 15 December 2022 following his release.

In November 2023 Mr Becker entered into a settlement agreement with the joint trustees. The parties are contractually bound to keep the terms of the settlement agreement confidential. In open court the joint trustees and Mr Becker explained that the settlement agreement was in respect of post-bankruptcy debts only.

At the hearing of the Application made on 15 February 2024, I ordered the suspension of discharge 2018 Order be lifted. The effect of my order is to discharge the bankruptcy of Mr Becker from 27 April 2024.

As the hearing was sandwiched between the winding up and the partnership lists, I informed the parties that I would provide my reasons in writing.

Supporting evidence

Mr Becker contends that he has complied with his obligations as far as he has been able and has acknowledged his mistakes for which he has paid a heavy price when he was sentenced to prison.

In his evidence in support of the Application Mr Becker explains that he had no experience of managing his finances or business affairs as from an early age he had advisors and representatives. He says he relied heavily on advisers and had no reason to believe that he had done anything wrong. He says:

“The effect of my being made bankrupt was to turn my world upside down. I had no idea as to how I was in the position in which I found myself and I had no idea about the bankruptcy process itself. Again, I was completely reliant on those advising me and I followed what I was told, or at least what I understood I was being told, believing such steps to be in my best interests. With hindsight, I can see, and as has now been explained to me, that some of the advice I was receiving was not only wrong, but wildly so, and provided by individuals who clearly did not have my best interests at heart. This is not to seek to cast blame elsewhere; it is simply a statement of the facts based on my experience… I will say now in evidence that I genuinely did not believe at any time that anything I had done was wrong or could lead to me being in breach of the criminal law. If I had been so aware, then I would never have conducted myself so. I must, however, as I repeat below, accept the findings of the English courts against me and the consequences that have followed.”

He explains that he has lost his assets and reputation, that he was unable to collate all the information asked for by the joint trustees and had no funds for legal representation. He provides a frank account stating that he should have worked with the joint trustees rather than oppose them. With the guidance of different advisors he understands his obligations and has entered into the settlement agreement. He explains:

“In the course of my incarceration, and subsequently, my new solicitors continued to work with the Trustees and their solicitors in seeking to resolve all matters that remained outstanding in my bankruptcy… The purpose of the Settlement Deed was to resolve, so far as was perceived as possible, all outstanding matters that remained live or potentially live in my bankruptcy”

His sworn evidence is that:

“I am simply incapable of doing more than I have done in terms of accounting for and delivering up assets, in particular the Trophies.”

I have been given no reason why I should reject his statement.

Mr Ford provides a witness statement on behalf of the joint trustees. He explains that Mr Becker had entered an income payments agreement on 27 April 2018 which was to expire on 25 March 2021. Not all the payments were made. The arrears as at 30 June 2023 were considerable. Failed and misguided applications that were made by Mr Becker in June and July 2018 led to a climb down and an adverse costs order.

The joint trustees were successful in realising a number of assets that vested in the estate including 81 items of memorabilia. The recoveries were insufficient to pay the creditors in full. This is particularly the case since one individual creditor has claimed a significant sum in the bankruptcy. Mr Becker describes this creditor as:

“a Swiss based entrepreneur with whom I was involved commercially over a period of ten years.”

The joint trustees are “neutral” on the Application. However, Mr Ford says in his witness evidence:

“Whilst the Trustees are not aware of any specific outstanding issues in terms of his statutory obligations to the Trustees, particularly given Mr Becker's past conduct as a bankrupt culminating in his imprisonment…they do not feel able to positively confirm that he has complied with his obligations under Part IX of the Insolvency Act 1986, either to the best of his abilities or otherwise.”

I commented at the hearing that I found this statement curious. The joint trustees should know if there are specific outstanding issues. The reason relied on for not being able to confirm Mr Becker's compliance, rests on his “past conduct culminating in his imprisonment”. The position taken by the joint trustees does not sit well with the statement that they are unaware of a failure to comply with any obligation. The fact that his past conduct led to a term in prison is not a relevant factor to take into account when deciding if Mr Becker has complied with his obligations.

The joint trustees would have done better if they had asked themselves whether there was sufficient evidence to succeed on an application to suspend discharge, by reference to section 333 of the 1986 Act namely, (i) has the bankrupt failed to provide information to the joint trustees that has been reasonably required; (ii) has the bankrupt failed attend on the trustee at any time when reasonably asked to do so; (iii) has the bankrupt failed to do ‘all such other things’ as the joint trustees may for the purposes of carrying out their functions under Part IX of the 1986 require. This may have enabled them to objectively view the current...