Kings Court Trust Ltd and Others v Lancashire Cleaning Services Ltd
| Jurisdiction | England & Wales |
| Judge | His Honour Judge Hodge |
| Judgment Date | 12 April 2017 |
| Neutral Citation | [2017] EWHC 1094 (Ch) |
| Docket Number | Claim No. D30MA313 |
| Court | Chancery Division |
| Date | 12 April 2017 |
[2017] EWHC 1094 (Ch)
IN THE HIGH COURT OF JUSTICE
CHANCERY DIVISION
MANCHESTER DISTRICT REGISTRY
Manchester Civil Justice Centre
1 Bridge Street West
M60 9DJ
His Honour Judge Hodge QC
Sitting as a Judge of the High Court
Claim No. D30MA313
Counsel for the Claimants: Mr Neil Berragan Instructed by Taylors Solicitors
No appearance by the Defendant
JUDGMENT APPROVED
His Honour Judge Hodge QC:
This is my extemporary judgment in the matter of Lancashire Cleaning Services Limited, case number D30MA313. This is the hearing of a Part 8 claim which has been brought before this court on extremely short notice and on two occasions today. The claim form was issued on 11 th April 2017, which is yesterday. As originally issued, the claimants were Kings Court Trust Limited and Ms Lois Joanne Talbot, purportedly in their capacity as the executors of the late Eric Anthony Pilling, deceased, who died on 28 th February 2017.
By his apparent last will dated 17 th February 2015, Mr Pilling appointed the two original claimants and a Ms Angela Jane Pilling as co-executors and trustees of his estate. The deceased was the sole shareholder and director of Lancashire Cleaning Services Limited, which was incorporated on 30 th June 2006 and adopted the regulations contained in 1985 Table A of the Companies (Tables A — F) (Amendment) Regulations 1985 as its Articles of Association, subject to modifications. In the absence of any power in those articles for the claimants to become registered as members of the company, they require an order pursuant to section 125 of the Companies Act 2006 to rectify the register and to make the entries themselves. There is, in addition to no surviving director of the company, no company secretary either.
The matter is said to be urgent as the company is continuing to trade but its bank account was frozen by its bank on Friday of last week, 7 th April. The claimants intend to appoint a director to take control of the company and, since there is no company secretary and no director, there is no-one who can respond to the application on behalf of the company and so the claimants seek an order dispensing with service and an immediate hearing of the application.
The claim form was supported by a witness statement from Mr Anthony Robert Catterall, a solicitor and senior partner of Taylors Solicitors of Blackburn, dated 11 th April 2017, together with exhibit ARC1. The witness statement spoke to the death of Mr Pilling on 28 th February and of his last will dated 17 th December 2015, which was exhibited. It was said that probate had not yet been granted. The witness statement goes on to refer to the deceased as the sole shareholder and director of the company, which is a private company providing office cleaning services in East Lancashire. It also refers to the fact that there is no company secretary. Reference is made to the certificate of incorporation and the latest annual return. The articles of association and a copy of Table A are included within the exhibit to Mr Catterall's witness statement.
Under regulations 29 to 31 of Table A, the deceased's shares have passed by operation of law to the claimants as his personal representatives. Mr Catterall notes that there is no provision which would permit the personal representatives to appoint a director where, as a result of death, the company has no shareholders or directors. The claimants are therefore unable to secure by themselves their entry on the register of members and the appointment of a director.
Following the death of the deceased, the company has apparently continued to trade under instructions from the second claimant, Ms Talbot. A potential purchaser of the company, at an attractive price of £100,000, has been identified. However, the company's bankers, NatWest, have frozen its account with effect from 7 th April. Mr Catterall exhibits a copy of the relevant email from the bank to the executors. That freezing of the account prevents the company from paying staff wages and other creditors. There is said to be an outstanding VAT liability, and staff wages are due to be paid this Thursday, 13 th April, which is tomorrow. Obviously, if wages are not paid, there is a high risk of staff leaving, of contracts being lost, and of the business being irreparably damaged.
In those circumstances, the claimants wish to apply for an order under section 125 of the Companies Act 2006 to rectify the register so that the deceased is substituted by the claimants as the holders of his shares. The claimants will then pass a written resolution appointing a director. The matter is said to be urgent. There is said to be no point in serving the proceedings on the company as it has no officers. The business is currently being managed under the instructions of the second claimant.
That was the state of the evidence when the matter came before me at 9.30 this morning, having been interposed in my list during the course of a two-day committal application. I pointed out to Mr Berragan that there was no satisfactory evidence as to the renunciation of probate by one of the three named executors, Ms Pilling. There was also no explanation as to why probate had not been obtained beyond the statement that it had not then been granted. My concern was that, in those circumstances, I had difficulty in seeing how the requirements of section 125 of the Companies Act 2006 could be satisfied. How could it be said that the late Mr Pilling's name remained on the register without sufficient cause, or that default had been made, or unnecessary delay had taken place, in entering the names of the nominated executors on the register when no grant of probate had yet been obtained and there was no satisfactory evidence before the court, beyond the mere fact of the will, that two of the three named executors, as claimants, should be entitled to be registered?
Mr Neil Berragan of counsel, who appears for the claimants, recognised the evidential gap and applied for a short adjournment to supplement the claimants' evidence, which I granted. The matter was listed to come back before me today at 1.30pm and it has in fact done so at 1.45pm. I now have a second...
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...may apply to the court for rectification of the register. In King's Court Trust Limited v Lancashire Cleaning Services Limited [2017] EWHC 1094 (Ch) [2017] Bus LR 1255, the PRs of the deceased sole director and shareholder applied for an order under s.125. It was held that even though the P......
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...in the BVI, which may provide an alternative route. In Kings Court Trust Limited & Others v Lancashire Cleaning Services Limited [2017] EWHC 1094 ("Lancashire Cleaning Services"), the deceased individual was the sole director and sole shareholder in the company. Probate had been applied for......