Lendinvest BTL Limted v Property Services LDN Ltd
| Jurisdiction | England & Wales |
| Judge | Greenwood |
| Judgment Date | 18 July 2023 |
| Neutral Citation | [2023] EWHC 1778 (Ch) |
| Court | Chancery Division |
| Docket Number | Case No: CR-2022-002211 |
In the Matter of Property Services LDN Limited
And in the Matter of the Insolvency Act 1986
[2023] EWHC 1778 (Ch)
INSOLVENCY AND COMPANIES COURT JUDGE Greenwood
Case No: CR-2022-002211
IN THE HIGH COURT OF JUSTICE
BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES
INSOLVENCY AND COMPANIES LIST (ChD)
Rolls Building
Royal Courts of Justice
7 Rolls Buildings
London EC4A 1NL
Ms Camilla Whitehouse (instructed by Brightstone Law) for the Petitioner
Mr Matthew Feldman (instructed by Treon Law) for the Respondent
Hearing date: 27 April 2023
This judgment was handed down remotely at 10.30am on 18 July 2023 by circulation to the parties or their representatives by e-mail.
ICC JUDGE
Introduction and Background
This is the final hearing of a winding up petition presented on 19 July 2022 by Lendinvest BTL Ltd (“ the Petitioner”) against Property Services LDN Ltd (“ the Company”). The petition is founded on the Company's failure to pay a costs order of £20,000 made against it by Spencer J on 23 June 2022 in proceedings in which it is the claimant in the Queen's Bench Division ( QB-2021-002969). The Petitioner was represented by Ms Camilla Whitehouse of Counsel.
The Company, represented by Mr Matthew Feldman of Counsel, argues that the petition should be dismissed: (i) because it has a genuine and serious pending cross-claim against the Petitioner in a sum greater than the petition debt; and (ii) because the costs order on which it is based is invalid and unenforceable.
In support of the petition, the Petitioner served three witness statements, each made by Mr Adem Essen, an associate solicitor of Brightstone Law LLP, the Petitioner's solicitors, made on 19 July 2022, 28 September 2022 and 26 October 2022.
Whilst the broad background to the dispute is convoluted, the evidence and facts ultimately material to the petition and to the Company's opposition are of comparatively limited scope.
The Petitioner is a commercial lender which on 29 March 2018 provided short-term bridging finance to a company called Laverstock Management Corporation Ltd (“ Laverstock”), secured by charges against four properties owned by Laverstock, and by a personal guarantee given by a Mr Charles Roberts, who is sometimes also known as and referred to as Mr Charles Gordon (“ Mr Roberts”). Since 21 July 2021, Laverstock has been in administration. Its joint administrators are Mr Daniel Richardson and Mr Edward Gee, both of CG & Co, 1 Booth St, Manchester (“ the Administrators”). Until 8 May 2018, when he resigned as a result of a disqualification order made against him under the Company Directors Disqualification Act 1986 on 17 April 2018, Mr Roberts was a director of Laverstock.
The four properties (together, “ the Properties”) against which the Petitioner was given security were:
6.1. 17 Bassant Road, Plumstead, London SE18 2NP (“ Bassant Rd”);
6.2. 2 Westmoreland House, 249 Southlands Road, Bromley, Kent BR1 2EG (“ Westmoreland”);
6.3. 307 Whitehorse Lane, South Norwood, London SE25 6UG (“ Whitehorse Lane”); and,
6.4. Flat 1, 138 Benares Road, Plumstead, London SE18 1HT (“ Benares Rd”).
On 22 March 2021, following Laverstock's failure to repay the sums due to the Petitioner, it appointed Ms Victoria Liddell and Ms Annika Kisby of Allsop LLP (“ the Receivers”) as joint receivers under the Law of Property Act 1925 in respect of Westmoreland, Whitehorse Lane and Benares Rd. On 19 April 2021, it appointed them as joint receivers in respect of Bassant Rd.
The Receivers decided that the Properties, or some of them, should be sold at auction. Laverstock however, and the Company, both objected, on the basis that the Properties had, so they said, already been sold by Laverstock to the Company pursuant to written contracts made on 18 March 2021, albeit subject to the registered charges in favour of the Petitioner. In respect of each of the Properties, the agreed price was said to be as follows:
8.1. Bassant Rd: £225,000;
8.2. Westmoreland: £250,000;
8.3. Whitehorse Lane: £500,000; and,
8.4. Benares Rd: £220,000.
The aggregate agreed sale price was therefore £1,195,000. At the same time, deposits were paid by the Company in the aggregate sum of £12,000, being about 1% of the total sale price.
The Company's director is Ms Tanya Minhas (sometimes referred to and known as Ms Tanya Gordon) (“ Ms Minhas”). She is Mr Roberts' wife. The Company's evidence in opposition to the petition is contained in her three witness statements made on 31 August 2022, 3 October 2022 and 14 November 2022. Attached to her first statement are nine “appendices” comprising some 1,045 pages. It was served on 6 September 2022, the day before the first hearing of the petition.
On 12 May 2021, Laverstock applied for an injunction (in advance of what became proceedings with claim number QB2021-001926) to prevent the sale of the Properties. Its application was heard by Moulder J, and at the hearing, it was represented by Mr Roberts, who was recorded on the face of the Order as having “ identified as” a director of Laverstock, which as explained above, he was not. The application was made against Allsop LLP and against the Petitioner, who were both represented by Ms Whitehouse (having been “ put on informal notice”, as was also recorded on the face of the Order). Moulder J ordered the withdrawal from auction of the Properties and prohibited their sale pending the return date, which was 20 May 2021. Following hearings on 20 May and (before HHJ Lickley QC) on 28 May 2021, the injunction was discharged.
The Company's evidence is that on or about 10 June 2021, it agreed with Laverstock to delay completion of the sale of the Properties from 11 June to 25 June 2021, because certain local authority searches had not been completed. Also, at about the same time, it claims to have agreed with Laverstock to a reduction in the price of each of the Properties, as follows:
12.1. Bassant Rd: £200,000;
12.2. Westmoreland: £220,000;
12.3. Whitehorse Lane: £400,000; and,
12.4. Benares Rd: £180,000.
The aggregate agreed sale price therefore became £1,000.000.
On 26 June 2021, the Company served on Laverstock a notice to complete the sales.
On 9 July 2021, the Receivers again placed the Properties into an auction due to take place on 5 August 2021. As mentioned above, on 21 July 2021, Laverstock went into administration (the Administrators having been appointed by the Petitioner). One consequence of the administration, pursuant to paragraph 43 of Schedule B1 to the Insolvency Act 1986, was the imposition of an automatic moratorium on various legal processes without the permission of the court or the consent of the Administrators.
On 23 July 2021, the Company applied for another injunction to prevent the sale of the Properties. Its application was made against Laverstock alone, and also sought an order that the sales to the Company be completed. Proceedings were commenced by Part 8 Claim Form and given claim number QB-2021-002969 – in other words, they were the proceedings in the course of which the costs order upon which the petition proceeds was subsequently made. In those proceedings, the Company sought an injunction preventing sale; specific performance of the contracts of sale to the Company; and damages. I shall refer to them as “ the Part 8 Proceedings”.
On 3 August 2021, in the course of the Part 8 Proceedings, on an application made without notice to the Administrators, or to the Receivers, and without the court's permission to pursue proceedings against Laverstock notwithstanding its administration, Kerr J granted an injunction prohibiting the sale or marketing of the Properties until trial or further order.
On 5 August 2021, the Administrators' solicitors wrote to the Company's solicitors stating that the proceedings had been commenced and the injunction sought in breach of the moratorium, and without notice to the Administrators.
On 30 March 2022, in the Part 8 Proceedings, an application was made by the Petitioner and by the Receivers seeking an order, amongst other things, discharging the order made by Kerr J on 3 August 2021, and seeking a “ declaration that the contracts for sale between [Laverstock] and [the Company] are void. Alternatively, a declaration that the contracts for sale dated 18th March 2021 are rescinded.”
That application came before Kerr J on 24 May 2022. The Company was represented by Mr Feldman, and the “ interested parties” by Ms Whitehouse (who the order recites as having appeared for the Petitioner and Allsop LLP). The judge discharged the injunction and adjourned the remainder of the application to be heard not before 3 October 2022 with a time estimate of 3 days. In his ex tempore judgment (of which there is a transcript) the judge said that he had not been told about the administration, and had instead been told that Laverstock had not intended to defend the Company's action. On that footing, having been significantly misled, he discharged his order of 3 August 2021.
Subsequently, on 7 June 2022, the Company applied, in the Part 8 Proceedings, for the “ dismissal” of the application made on 30 March 2022, “ as they [which seems to have been a reference to Brightstone Law, the solicitors to the Petitioner and the Joint Receivers/Allsop LLP] have acted dishonestly in not serving the” application and supporting evidence; also relied on was an alleged failure to comply with CPR rules 6.7 and 23.7. The purpose of the application seems to have been to bring about the reinstatement of the injunction originally granted by Kerr J on 3 August 2021.
That application came before Spencer J on 23 June 2022. The Company appeared by counsel, Mr Janaka Siriwardena, and the interested parties by Ms Whitehouse. The...
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