Re DAP Holding NV
| Jurisdiction | England & Wales |
| Judgment Date | 26 September 2005 |
| Neutral Citation | [2005] EWHC 2092 (Ch) |
| Court | Chancery Division |
| Date | 26 September 2005 |
[2005] EWHC 2092 (Ch)
IN THE HIGH COURT OF JUSTICE
CHANCERY DIVISION (Companies Court)
Royal Courts of Justice
Strand
London WC2A 2LL
Before: Mr Justice Lewison
Approved Judgment
Lewison J.:
1 There are before the court 18 schemes of arrangement for approval under the terms of s.425 of the Companies Act 1985. One of the schemes relates to a company called DAP Holding NV, and the remaining 17 relate to other Dutch companies.
2 DAP Holding NV is a reinsurer and consequently falls outside the European definition of a company carrying on insurance business for the purposes of certain regulations to which I will come in due course. The remaining 17 companies are insurers for those purposes. It is accepted that none of the companies have their centre of main interest in England and Wales, and none of them have an establishment in England and Wales.
3 I am satisfied that the formalities applicable to each of the schemes have been complied with in terms of what has been ordered by the court for the purpose of convening creditors’ meetings. I am satisfied that the statutory majority of creditors, both in number and in value, have voted in favour of the schemes. I am also satisfied that the terms of the schemes are fair in the sense that an honest and reasonable creditor acting in his own interest could properly vote in favour of the schemes.
4 The only question that has troubled me is whether I have jurisdiction to sanction the scheme as a result of the fact that each of the scheme companies is a Dutch company with neither its centre of main interest nor an establishment in this country. 5 Mr Trower Q.C. has carefully taken me through the various statutory and other legislative instruments and also referred me to the decision of Lawrence Collins J. in Re Drax Holdings Ltd [2004] 1 W.L.R. 1049; [2004] B.C.C. 334. As a result of that tour I am satisfied that I do have jurisdiction to sanction the schemes, but I should very shortly explain why.
6 Section 425 enables the court to sanction a compromise or arrangement between a company and its creditors, or any class of them, or between the company and its members or any class of them. Section 425(6)(a) provides that “company” “means any company liable to be wound up under this Act”. The expression “this Act” is extended by s.735A to include certain parts of the Insolvency Act 1986. Section 221(1) of the Insolvency Act 1986 provides:
“Subject to the provisions of this Part, any unregistered company may be wound up under this Act; and all the provisions of this Act and the Companies Act about winding up apply to an unregistered company with the exceptions and additions mentioned in the following subsections.”
Section 221(5) deals with circumstances in which a company may be wound up. Section 225 provides for the winding up of a company incorporated outside Great Britain and provides expressly that it is subject to the EC Regulations. The words of s.221(1), that is to say “any unregistered company”, do not on the face of them carry any restriction on the theoretical jurisdiction of the court to wind up a company on territorial grounds. Mr Trower Q.C. submits, in my view rightly, that whatever it is that is sought to be wound up must fall within the juridical concept of a company and it would not therefore extend to natural persons or to entities governed by international treaty such as, for example, the International Tin Council. But there is nothing in the words of the Act themselves which inhibit the court's territorial jurisdiction.
7 This question was considered by Lawrence Collins J. in Re Drax Holdings Ltd ( supra). He came to the conclusion in para.26 of his judgment that the various judge-made conditions which had...
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