Howard Smith and David Costley-Wood (Joint Administrators of Peter Jones (China) Ltd) v The Registrar of Companies
| Jurisdiction | England & Wales |
| Judge | Davis-White |
| Judgment Date | 05 February 2021 |
| Neutral Citation | [2021] EWHC 215 (Ch) |
| Docket Number | Case No: CR-2020-LDS-000577 |
| Court | Chancery Division |
| Date | 05 February 2021 |
[2021] EWHC 215 (Ch)
IN THE HIGH COURT OF JUSTICE
BUSINESS AND PROPERTY COURTS IN LEEDS
INSOLVENCY AD COMPANIES LIST (ChD)
1 Oxford Row, Leeds, LS1 3G
HH JUDGE Davis-White QC
(SITTING AS A JUDGE OF THE HIGH COURT)
Case No: CR-2020-LDS-000577
IN THE MATTER OF PETER JONES (CHINA) LIMITED (CRN: 00783518)
AND IN THE MATTER OF THE INSOLVENCY ACT 1986
Ms Cristin Toman (instructed by Gordons LLP) for the Applicants
The Respondent did not appear and was not represented but filed written submissions on the quantum of costs.
Hearing date: 27 November 2020
Written submissions on the quantum of costs were lodged on 8 January 2021 by the Treasury Solicitor on behalf of the Respondent
Approved Judgment
I direct that pursuant to CPR PD 39A para 6.1 no official shorthand note shall be taken of this Judgment and that copies of this version as handed down may be treated as authentic.
HH JUDGE Davis-White QC (SITTING AS A JUDGE OF THE HIGH COURT)
HH Judge Davis-White QC:
On 27 November 2020 I made an order containing certain declarations and requiring the registrar of companies (the “Registrar”) to remove from the record of the above-named company, Peter Jones (China) Limited (the “Company”), certain pages from the statement of affairs lodged by the applicants (the “Applicants” or “Administrators”). The pages in question contained the schedules referred to in Rule 3.30(6)(b) of the Insolvency (England and Wales) Rules 2016 (“IR 2016”) (schedules of employees and consumers claiming amounts paid in advance for the supply of goods and service) (the “Schedules”).
Under r3.32 IR 2016, administrators are required to deliver to the Registrar of Companies as soon as reasonably practicable a copy of the statement of affairs. However, under paragraph 2 of that rule, the administrator must not deliver to the Registrar, with the statement of affairs, any schedule required by rule 3.30(6)(b).
In this case, as I shall explain, such schedules were incorrectly lodged. As requested, the Registrar originally did not register the statement of affairs (and Schedules) but returned them. However, later he did register the statement of affairs in its entirety and containing the Schedules. (As I understand it, he also registered the statement of affairs in a version that did not include the Schedules.) The Administrators asked the Registrar to remove such filing of the complete statement of affairs (including the Schedules) from the register. The Registrar refused to do so without court order. On 24 November 2020, the Administrators made an application to the court. On 27 November 2020, I granted the relief that I have mentioned, as well as abridging time for service. On that occasion I also ordered the Registrar to pay the costs of the Administrators. As the Administrators had not lodged and served a schedule of costs, I laid down a timetable for such schedule to be lodged and served. I later provided an opportunity for submissions by the Registrar to be lodged to deal with the quantum. Such submissions were lodged in writing on 8 January 2021. Subsequently I gave the Applicants an opportunity to respond to the Registrar's submissions on the schedule of costs. They did not take up that opportunity. I had earlier indicated that I would give the reasons for my order on 27 November 2020 on a later occasion. This judgment gives those reasons and also deals with the question of the quantum of the costs ordered to be paid by the Registrar determined by way of summary assessment.
The Facts
The position is set out fully and fairly in the witness statement of Mr Howard Smith dated 24 November 2020 and made in support of the application. He is one of the two Administrators appointed in relation to the Company. Rather than paraphrase it is convenient if I simply set out the main parts of the witness statement, which I do below.
The Administrators were appointed by the directors on 8 July 2020, pursuant to paragraph 22 of Schedule B1 to the IA 1986. They filed their proposals dated 28 August 2020 with the Registrar. The circumstances in which the statement of affairs came to be filed with the Schedules that should not have been filed is explained as follows:
“ 3.2 As a consequence of the Pandemic and the Guidance the Applicants and their staff are currently working from home. On 3 September 2020 a junior member of the Applicants' team sent a copy of the statement of affairs sworn by [one of the directors] on 1 September 2020 (SOA) to the Respondent by email to be filed in respect of the Company and copied his supervisor (Supervisor) into that email. The Supervisor was on annual leave until 7 September 2020. Upon his return to the office and upon opening the email dated 3 September 2020 the Supervisor discovered that the SOA (which shall hereafter be referred to as the “Non-Compliant SOA”) that was attached to the email and sent the Respondent by post contained schedules of the employees and former employees of the Company (Employee Schedule) and those consumers claiming amounts paid in advance for the supply of goods and service (together referred to as the “Schedules”) which IR 3.32(2) prohibited the Applicants from delivering to the Respondent. Further in respect of the Employee Schedule the Applicants considered there had been a breach of the Applicants' data protection obligations pursuant to the General Data Protection Regulation (EU) 2016/679 (Breach).
3.3 On discovering the above the Applicants wrote to the Respondent by email on 7 September 2020 to request that the filing of the Non-Compliant SOA be cancelled in an effort to minimise the consequences of the Breach. A further copy of the Non-Compliant SOA was attached to this email. On 8 September 2020 the Applicants sent a further copy of the Non-Compliant SOA to the Respondent and requested that it not be filed with the records of the Company.
3.4 On 11 September 2020 the Respondent confirmed to the Applicants' office that the Form AM02 had been returned to the Applicants' Leeds office by unregistered post.
3.5 On or around 8 October 2020 the Applicants subsequently discovered that the Non-Compliant SOA had been filed against the Filing History on 23 and 28 September 2020, notwithstanding the Respondent's correspondence dated 11 September 2020
3.6 The Applicants subsequently wrote to the Respondent on 8 October 2020 to request that the Non-Compliant SOA be removed from the Filing History.
3.7 On 16 October 2020 the Respondent confirmed that the SOA submitted on 5 September 2020 was rejected on 10 September 2020 in response to the Applicants' request. The Respondent further advised the Applicants that if they had inadvertently filed two further copies of the SOA then they would require a rectification court order to remove the Non-Compliant SOA from the Filing History.
3.8 On 20 October 2020 the Applicants advised the Respondent that no further copies of the Non-Compliant SOA had been filed since the Respondent's email dated 11 September 2020 was received. The Applicant also confirmed that a correct version of the SOA had been subsequently filed (which shall hereafter be referred to as the “Compliant SOA”).
3.9 On 28 October 2020 the Respondent confirmed that the following submissions of the SOA had been made: 3 September, 5 September, 7 September and 2 copies of the SOA on 22 September 2020. The Respondent confirmed that the submissions made on the following dates had been rejected: 5 September, 7 September and 1 copy of the SOA on the 22 September 2020 due to poor quality. The Respondent again confirmed to the Applicant that if they had inadvertently filed 2 further copies of the Non-Compliant SOA they would require a rectification court order to remove them.
3.10 On 4 November 2020 the Applicants confirmed to the Respondent that no third copy of the Non-Compliant SOA had been sent to the Respondent and the latter statement of affairs that was filed was the Compliant SOA. The Applicants also requested that this matter be referred to the Respondent's legal team to review. The Applicants have received no further correspondence from the Respondent in connection with this matter.
Two points emerge from the above. First, the Registrar by his conduct accepted that he was able to reject registration of a statement of affairs as requested, at least when the relevant state of affairs set out in that request were as in this case. Secondly, that there is a factual dispute or at least uncertainty as to whether the Non-Compliant statement of affairs as registered by the Registrar was, by mistake, a version that the Registrar had already agreed not to...
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