Davies and Another v Davies
| Jurisdiction | England & Wales |
| Judge | Mr Justice Newey |
| Judgment Date | 22 July 2016 |
| Neutral Citation | [2016] EWHC 2698 (Ch) |
| Docket Number | Case No: CH/2016/000022 |
| Date | 22 July 2016 |
| Court | Chancery Division |
2016 EWHC 2698 (Ch)
IN THE HIGH COURT OF JUSTICE
CHANCERY DIVISION
Rolls Building
7 Rolls Buildings
Fetter Lane
London
EC4A 1NL
Mr Justice Newey
Case No: CH/2016/000022
Mr P French (instructed by Michelmores LLP) appeared on behalf of the Appellants
(As Approved)
I have before me an application for permission to appeal against a decision of His Honour Judge Jarman QC dated 18 December of last year.
By his judgment, Judge Jarman declined to set aside statutory demands which had been served on the appellants, Mr and Mrs Davies, by their daughter. Judge Jarman arrived at his decision on the strength of the decision of Jacob J in Re a debtor (No 415/SD/93) [1994] 2 All ER 168, also reported at [1994] 1 WLR 917. The essence of Jacob J's decision in that case can be seen from the headnote in the Weekly Law Reports, which states this:
"[T]he exercise by the court of its powers to set aside a statutory demand on 'other grounds' within the true meaning of rule 6.5.4(d) of the Rules of 1986 was restricted to inquiries as to whether the demand ought to be set aside because it was either defective to the point of being unfair to the debtor or there was evidence that, as defined by section 268 of the Act of 1986, the debt would be paid immediately or there was a reasonable prospect of it being paid when it fell due"
and, further, quoting again:
"[W]hether an offer by the debtor to secure or compound for a debt had been unreasonably refused by the creditor would be considered subsequently at the hearing of the bankruptcy petition."
The references there to the "Rules of 1986" and the "Act of 1986" are to the Insolvency Rules 1986 and the Insolvency Act 1986. Rule 6.5 of the Insolvency Rules deals with circumstances in which statutory demands can be set aside, and Rule 6.5(4)(d) provides that the court may accede to an application to set aside if:
"the court is satisfied, on other grounds, that the demand ought to be set aside."
The present case has a somewhat complex history. The statutory demands that have been served relate to sums said to be outstanding in respect of orders for costs. As Mr Paul French, who appears for the appellants, recognises, as at the date of the demands a sum in excess of £200,000 was due to the respondent by way of costs. The position has changed to an extent more recently with a decision of the Court of Appeal in the main litigation between the parties. That led to an order for costs in favour of the appellants as regards the appeal. As I understand it, however, it is plain that, overall, a substantial sum remains due to the respondent.
Mr French nevertheless contends that the circumstances are such that Judge Jarman ought not to have allowed the respondent to proceed to the presentation of bankruptcy petitions or, at least, that he has a real prospect of persuading the court on the hearing of a full appeal that Judge Jarman was indeed mistaken. He says that the present case is very different from that before Jacob J, which he terms a common or garden tax collection case. In contrast, there is here, says Mr French, good reason to think that the fact of presentation of bankruptcy petitions against the appellants would have a significant impact upon them in terms of interfering with the continued operation of their farming business and potentially the ongoing conduct of the...
To continue reading
Request your trial