Secretary of State for Trade and Industry v Davies

JurisdictionEngland & Wales
CourtCourt of Appeal (Civil Division)
Judgment Date24 May 1996

Court of Appeal

Before Lord Justice Neill, Lord Justice Hobhouse and Lord Justice Millett

Secretary of State for Trade and Industry
Davies and Others

Directors - disqualification - leave to start proceedings out of time - inadequacy of reasons only one consideration

Leave to start proceedings out of time

The inadequacy of the reasons for the delay by the Department of Trade and Industry in bringing disqualification proceedings against a company director under section 6 of the Company Directors' Disqualification Act 1986 was merely one of the considerations which had to be taken into account by a court when deciding whether to give leave for the disqualification proceedings to be commenced out of time.

The Court of Appeal so stated in dismissing an appeal by a company director, Vernon Davies, from the dismissal by Mr Justice Carnwath on May 2, 1995 of his appeal from an order of the registrar granting the Secretary of State for Trade and Industry an extension of time for the service of evidence in support of his originating summons issued under section 6 of the 1986 Act.

Section 6 of the 1986 Act required the court to make a disqualification order against any person where, on an application made under the section, it was satisfied that he was or had been a director of a company which had become insolvent and that his conduct as a director of that company made him unfit to be concerned in the management of a company.

The originating summons was issued within the relevant period of two years so that leave of the court under section 7(2) of the 1986 Act was not required. But the secretary of state was unable to file detailed evidence in support of the application with the summons as required by the Insolvent Companies (Disqualification of Unfit Directors) Proceedings Rules (SI 1987 No 2023).

Accordingly, at the same time as issuing the originating summons he made an application to the registrar for an extension of time for the service of evidence until a date long after the two-year period was due to expire.

The registrar granted the application and his decision was upheld by the judge who considered that the reasons given by the secretary of state for the delay were far from satisfactory, but that that consideration was far outweighed by others which pointed towards the granting of leave.

Mr Michael Briggs, QC and Mr Paul Girolami for Mr Davies; Mr A W H Charles and Mr Richard Gillis for the secretary of state.

LORD JUSTICE MILLETT said that the...

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