Paul Allen (as Trustee in Bankruptcy) v Pramod Mittal
| Jurisdiction | England & Wales |
| Judge | Agnello |
| Judgment Date | 01 April 2022 |
| Neutral Citation | [2022] EWHC 762 (Ch) |
| Docket Number | Case Number 001363 of 2019 |
| Court | Chancery Division |
[2022] EWHC 762 (Ch)
DEPUTY INSOLVENCY AND COMPANIES COURT JUDGE Agnello QC
Case Number 001363 of 2019
IN THE HIGH COURT OF JUSTICE
BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES
INSOLVENCY LIST (Ch D)
IN THE MATTER OF PRAMOD MITTAL (IN BANKRUPTCY)
AND IN THE MATTER OF THE INSOLVENCY ACT 1986
Royal Courts of Justice
7 The Rolls Building
Fetter Lane
London
EC4A 1NL
Mr Tony Beswetherick QC (instructed by Mishcon de Reya LLP) for the Applicant
Mr James Gibbons and Mr Chichester-Clark (instructed by Collyer Bristow LLP) for the Respondent
Hearing dates: 10 and 19 November 2021
FINAL JUDGMENT
Introduction
Mr Mittal was made bankrupt by order of this court on 19 June 2020. He was due to be discharged, pursuant to section 279(1) of the Insolvency Act 1986 (‘ IA 86’) on 18 June 2021. On 10 June 2021, the Trustee issued an application (‘the suspension application’) seeking an order to suspend discharge of the bankruptcy pursuant to section 279(3). Unless otherwise suspended by order of the court, a bankrupt is discharged at the end of one year beginning with the date on which the bankruptcy commences. The issue of the service of the suspension application is one of the matters which I need to determine. It is clear that there was insufficient time to serve in accordance with the Insolvency Rules between 10 June 2021 and the discharge occurring on 18 June 2021. On 17 June 2021, the suspension application came before ICC Judge Prentis on an urgent basis. The Judge made an order granting an interim suspension of Mr Mittal's discharge without prejudice to Mr Mittal's right to oppose the Trustee's application and at paragraph 4 of the order, stated, ‘for the avoidance of doubt, this Order is made without prejudice to the Respondent's right to oppose suspension of his discharge from bankruptcy on any grounds at the Final Hearing, including those advanced on his behalf at the hearing on 17 June 2021’. There is some dispute as between the parties as to the ambit of this part of the order and the effect, if any, of the representations made before the Judge on 17 June 2021.
The suspension application was then listed for hearing on 10 November 2021. Evidence was served by Mr Mittal being a witness statement dated 25 August 2021. By letter dated 29 October 2021, Mr Mittal's solicitor stated that he would contest the application on the issue of service and procedure and not in relation to the allegations which had been made as to his conduct which the Trustee averred justified the making of the suspension order. The matter was heard before me on 10 November 2021 and then was adjourned part heard by me for a further half day on 19 November 2021.
Shortly before the adjourned hearing date, the Trustee issued an application seeking post validation of service of the suspension application. There was no real reason as to why this application was not made before. I did ask Mr Beswetherick, acting on behalf of the Trustee, to confirm at the hearing on 10 November 2021 that no such application had been made. He confirmed that no such application had been made. Although it is quite unusual that an application is issued between the first and the second day of the hearing, no real objection was taken. I considered it and deal with it below. Mr Gibbons, acting on behalf of Mr Mittal, had in many respects dealt with the merits of such an application in his skeleton. I should add that I had the benefit of Mr Gibbons' submissions before me, but the skeleton relied upon was drafted by Mr Chichester-Clark. Mr Gibbons took over the case at the very last minute when Mr Chichester-Clark became indisposed.
The grounds upon which Mr Mittal seeks dismissal of the suspension application are as follows:-
(i) The Trustee failed to effect valid service of the suspension application prior to the date upon which Mr Mittal was discharged in accordance with section 279 IA 86;
(ii) The Trustee failed to serve the suspension application and the evidence on Mr Mittal and the Official Receiver within time prior to the first hearing of his application on 17 June 2021.
Mr Gibbons on behalf of Mr Mittal confirmed that ground 2 was an alternative to ground 1. Effectively ground 2 is based on the premise that I conclude that there was valid service of the suspension application and the evidence albeit such service was not effected in accordance with the time limits in the IA 86 and the Insolvency Rules 2016 (‘IR 2016’).
The Trustee opposes this application and asserts in summary that:-
(1) There was valid service of the suspension application and evidence on 11 June 2021, or there was an agreement/acceptance between the parties that valid service was effected on 11 June 2021, alternatively when the hearing bundle was served on 15 June 2021;
(2) If there was no valid service prior to the hearing on 17 June 2021, then the issue of valid service was waived and/or Mr Mittal is estopped from relying upon it by reason of the admissions/statements made at that hearing by Counsel in his skeleton as well as by reason of the conduct of Mr Mittal;
(3) There is now before me an application for post validation service issued by the Trustee and the Court should grant it in all the circumstances.
I should add that Mr Beswetherick on behalf of the Trustee also made strong submissions relating to the merits of the application for a suspension of the bankruptcy as well as taking me through in detail the background to the application and the conduct of Mr Mittal relied upon by the Trustee. I have not set all the details of these matters in this judgment. For the purposes of this judgment and on the basis of the evidence which has been filed, I am prepared to accept that there is a compelling case on the merits for the suspension of bankruptcy. As was made clear shortly before 10 November 2021, the hearing before me related only to the issue of service which I have identified above. Mr Mittal has elected not to file any evidence relating to the merits of the suspension application. In so far as necessary, I will deal with whether a suspension order should be made once I have dealt with the service issues. However, there is, on the evidence before me, no real defence raised by Mr Mittal on the points raised and relied upon by the Trustee.
The issue of service of the suspension application
The relevant facts as to what occurred are as follows. These are not disputed although the parties assert that what occurred is open to different interpretation. On 10 June 2021, the suspension application was issued by the Trustee. On 11 June 2021, the following exchanges took place:-
(1) At [15:18], Mishcon sent an email to Collyer containing a link to files stored on a Mimecast platform. The covering email stated:
“Please see the attached correspondence, a hard copy of which has been sent today via same day courier.”
(2) At [18:53] Mishcon sent a further email to Collyer saying that no one had been at Collyer's offices to accept delivery of the application. They proceeded to ask whether Collyer were prepared to accept service via email:
“We should be grateful if you would confirm you are content to accept service of our letter and Application via email. In any event, we have arranged for the hard copy to be re-delivered to your offices on Monday morning.”
(3) At [19:14] Collyer replied as follows:
“We have moved offices to….I thought that had been brought to your firm's attention.
In any event, we will accept service by email and there is no need to deliver a hard copy to our new offices. (I am still working remotely.)” Mishcon replied [19:19] saying “Thank you, I shall be sure to update our records”.
(4) After the last email reply from Mishcon, there was no attempt to send the documents via email.
The relevant provisions relating to service of an application to suspend discharge from bankruptcy pursuant to section 279 IA 86 are in CPR Part 6 in respect to the service rules relating to a claim form. Insolvency Rule 2.9(1) (IR 2016 which are applicable here) requires that an applicant serves a sealed copy of the suspension application upon the Respondent and the Official Receiver. Paragraph 5.1 of the Practice Direction on Insolvency Proceedings provides that Schedule 4 to IR 2016 prescribes the requirements for service under IA 86 and IR 2016. CPR Pt 6 applies by virtue of Schedule 4 to IR 2016, save where it provides otherwise or the Court so directs. Paragraph 1(2) of Schedule 4 IR 2016 states,
“Service is to be carried out in accordance with Part 6 of the CPR as that Part applies to either a “claim form” or a “document other than the claim form” except where this Schedule provides otherwise or the court otherwise approves or directs.”
The above is agreed between the parties. The disagreement arises as to what is the effect of the string of emails set out above. Mr Gibbons for Mr Mittal submits that the email from Collyers agreeing to accept electronic service by email related to prospective transmissions. Mr Beswetherick on behalf of the Trustee submits that a reading of the emails is such that the agreement to accept electronic service encompassed the documents which had already been transmitted by electronic means on 11 June 2021, at 15.18.
I turn back to the emails. The email exchange states, ‘We should be grateful if you would confirm you are content to accept service of the Application via email.’ The reply to this request was, ‘…we will accept service by email and there is no need to deliver a hard copy to our new offices.’ Mr Beswetherick submits that this related to the document which had been sent via email on 11 June 2021 at 15.18. The email sent on earlier that day stated, ‘Please see attached correspondence, a hard copy of which has been sent today via same...
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Paul Allen (as Trustee in Bankruptcy of Pramod Mittal) v Pramod Mittal
...she gave for dismissing the suspension application were set out in a judgment she handed down on 1 April 2022 ( Allen v Mittal [2022] EWHC 762 (Ch)). She also explained why she was dismissing an application issued by the Trustee on 15 November 2021 (the “service application”) seeking an or......
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