Secretary of State for Trade and Industry v Tjolle and Others
| Jurisdiction | England & Wales |
| Judgment Date | 02 May 1997 |
| Date | 02 May 1997 |
| Court | Chancery Division |
Chancery Division
Before Mr Justice Jacob
Directors - disqualification - whether public interest likely to be served
The Secretary of State for Trade and Industry should consider whether the public interest was served by pressing on with an application for the disqualification of a company director when the period of disqualification was likely to be low and the case had been significantly delayed through no fault of the respondent.
Any public interest involved in a disqualification might be outweighed by the de facto disqualification which was often the result of pending proceedings and the legal costs involved in going through with the procedure.
Mr Justice Jacob sitting in the Chancery Division so stated when dismissing the secretary of state's application for an order under section 6 of the Company Directors' Disqualification Act 1986 against the third respondent, Diana Kenning. The first and second respondents to the application were Valere Nikolas Frederick Tjolle and Theresa Evelyn McDermott.
Mr Stephen Davies for the secretary of state; Mrs Kenning in person.
MR JUSTICE JACOB said that Land Travel Ltd, a holiday company, went into voluntary liquidation in July 1992 with an estimated deficiency in respect of unsecured creditors of £12.4 million, including £6.6 million of lost deposits paid by members of the public for future holidays.
The Fraud Squad seized the company's records.
Mr Tjolle owned 999 and Mrs McDermott owned one of the 1,000 issued shares in the company's holding company. Following the appointment of liquidators and the bankruptcy of Mr Tjolle, he pleaded guilty to fraudulent trading and was sentenced to nine months imprisonment and disqualified from being a company director for 10 years.
The secretary of state was of the opinion that Mr Tjolle's conduct merited the maximum possible period of disqualification under the Act, namely 15 years.
His Lordship said that it was highly desirable that criminal courts should be aware of the sentencing guidelines laid down by the Court of Appeal inIn re Sevenoaks Stationers (Retail) LtdELR ([1991] Ch 164).
Civil and criminal courts should apply the same standards. The purpose of disqualification, to protect the public from the activities of those unfit to be concerned in company management, was the same in both courts.
The period of disqualification was perhaps not always seen...
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