Edward Avery-Gee as Trustee in Bankruptcy of Lawrence Coppen v Lesley Ann Coppen
| Jurisdiction | England & Wales |
| Judge | Pearce |
| Judgment Date | 21 November 2022 |
| Neutral Citation | [2022] EWHC 2958 (Ch) |
| Docket Number | Claim No. CR-2022-MAN-000599 |
| Court | Chancery Division |
[2022] EWHC 2958 (Ch)
His Honour Judge Pearce
Claim No. CR-2022-MAN-000599
IN THE HIGH COURT OF JUSTICE
BUSINESS AND PROPERTY COURTS IN MANCHESTER
INSOLVENCY AND COMPANIES LIST (ChD)
IN THE MATTER OF TARAY BROKERING LIMITED
AND IN THE MATTER OF THE COMPANIES ACT 2006
Manchester Civil Justice Centre
1 Bridge Street West
Manchester
M60 9DJ
Ms Lisa Feng (instructed by Brabners plc) for the Claimant
The Defendants were not represented and did not attend
Hearing date: 14 November 2022
NOTE: This judgment was handed down in writing on 21 November 2022 at 2pm.
INTRODUCTION
The judgment relates to a discrete point of practice that arose for consideration in the context of an application to commit for breach of a court order. The application itself was compromised and this judgment has no consequence for the ultimate order, which is as the parties agreed.
By way of background, the Claimant is the Trustee in Bankruptcy of Mr Lawrence Coppen. By a Part 8 Claim Form issued on 18 July 2022, he sought an order pursuant to section 125 of the Companies Act 2016 for rectification of the register of members of the Second Defendant so as show the Claimant as the owner of the entirety of its shares.
On 22 September 2022, Deputy District Judge Blakeborough heard the application. The First Defendant did not attend the hearing. The Judge made an order against the First Defendant (or other directors of the Second Defendant) requiring rectification of the order within 5 business days of the date of the order. The order, which did not contain a penal notice within the meaning of CPR Part 81.4, was served on the First Defendant by letter dated 23 September 2022.
The First Defendant did not comply with the order within the time allowed.
By letter dated 11 October 2022, the Claimant wrote to the First Defendant, enclosing a further copy of the order and requiring compliance within 24 hours. The copy of the order served was in identical terms to the order originally made, save that the Claimant appended to the front of it a notice in the following terms:
“IMPORTANT – PLEASE READ
PENAL NOTICE
IF YOU, LESLEY ANN COPPEN, DO NOT COMPLY WITH THE TERMS OF THE ATTACHED ORDER YOU MAY BE HELD IN CONTEMPT OF COURT AND MAY BE IMPRISONED OR FINED, OR YOUR ASSETS CONFISCATED OR INCUR ANOTHER PUNISHMENT UNDER THE LAW.”
Again the First Defendant did not comply.
The Claimant then applied to commit the First Defendant for non-compliance with the order. That application was listed before me on 14 November 2022. The parties reached terms pursuant to which the application was withdrawn.
Counsel appeared in front of me at the hearing on 14 November 2022 because I had expressed concern that the second version of the order that had been sent to the Court had never directed that a penal notice be attached to the order, yet the second version of the order served had such a penal notice attached. She made oral submissions on the issue and has subsequently added to those with written submission. I am grateful to her for her diligent research on the issue.
THE RELEVANT LAW
The following propositions are either clear from the terms of the Civil Procedure Rules or are well established in authority:
8.1. CPR Part 81.4(2)(d) requires that any application for committal on the grounds of the alleged breach or disobeying of an order includes a statement that the order included a penal notice.
8.2. There is no set form of words for a penal notice, though the White Book 2022 notes the wording in the previous version of CPR81: “ If you the within-named [ ] do not comply with this order you may be held to be in contempt of court and imprisoned or fined or your assets seized.”
8.3. The absence of a penal notice is not necessarily fatal to the application to commit, but the non compliance with the rules can only be waived where the court is satisfied that no injustice is caused to the defendant thereby (see paragraph 81.4.4 of the White Book 2022, and in particular the judgments of Kenneth Parker J in Serious Organized Crime Agency v Hymans [2011] EWHC 3599 and Miles J in Business Mortgage Finance 4 plc v Hussain [2022] EWHC 449 1).
THE ISSUE
The Claimant contends that, where the court itself has not appended a penal notice to an injunction, it is open to the party who sought the injunction to do so. He relies on the following in support of this proposition
9.1. The decision of Park J in Anglo Eastern Trust v Kermanshahchi, 21 October 2002, reported at [2002] All ER (D) 296; [2002] 10 WLUK; (2002) (99) 45 LSG 35; The Times, 8 November 2002; [2002] CLY 454. Kermanshahchi is only conveniently available in a digested form. In the Westlaw report of the case, the following is stated:
“Summary
A penal notice included in the copy of a court order served on the claimant by the defendant was enforceable notwithstanding that the notice had not been brought to the judge's attention when the order was sealed.
Abstract
A applied for an order that a penal notice be deleted from an order served on it by K. The penal notice had not been drawn to the court's attention at the time that the order was sealed.
Held
Application refused.
The Rules of the Supreme Court 1965 Ord.45 r.7(4) appeared to suggest that the penal notice was not part of the order itself and that it could be added to a copy of an order served under the rule. To comply with Ord.45 r.7(4) 2 such that enforcement by committal would be possible, the party who had created a copy of the order for service had to attach the penal notice to it. As the penal notice had been properly included in the copy of the order served on A, it was valid and should not be deleted.”
The summary of the judgment at [2002] 2 All ER (D) 296 states in similar terms:
“ The words used in RSC Ord 45, r 7(4) seemed to suggest that the penal notice was not part of the order itself, but might be added on to a copy of the order served under the rule. That interpretation was in line with Ord 45 r 2(a), and in the instant case, it assumed that a ‘copy’ of the order agreed to on 16 October had to be personally served on the claimants. In those circumstances, it was for the person who had created a copy of the order for service to put the penal notice on it, if r 7(4) was to be complied with in order to make enforcement of the order possible by the means described in Ord 45.5. In the instant case therefore, the addition by the defendant's solicitors of the penal notice, although objected to by the claimants, was an act that he was entitled to do, as the penal notice was properly included, not in the order, but in a ‘copy of the order’ which was served on the claimants as provided by r.7(4). Accordingly, the court would refuse to order that the penal notice be deleted from the order.”
9.2. The decision of Horner J in Deery v Deery [2016] NI Ch 11. The claim involved the enforcement of a consent order for possession of premises by an application for
committal. As here, a penal notice had not been attached to the original court order. The plaintiff sought to re-serve a copy of the order with a penal notice attached. Horner J was concerned with the proper construction of the original agreement of the parties, with respect to the plaintiff's ability to enforce the terms of the agreement. He concluded that enforcement by committal was consistent with the agreement and stated that the plaintiff was at liberty to re-serve the order with a penal notice attached. In coming to this conclusion, he said:“28. Some support for my conclusion is derived from Anglo-A-Eastern Trust v Kermanshahchi [2002] All ER (D) 296 where Park J had to consider an issue in relation to the deletion of a Penal Notice from an order. He held that Rule 7(4) of Order 45 (the equivalent of our Order 45 Rule 5(4))...
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