Ulster Bank LTD and Michael Adrian Taggart and John Desmond Taggart
| Jurisdiction | Northern Ireland |
| Judge | Huddleston J |
| Neutral Citation | [2022] NICh 8 |
| Date | 01 June 2022 |
| Court | Chancery Division (Northern Ireland) |
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Neutral Citation No: [2022] NICh 8
Judgment: approved by the Court for handing down
(subject to editorial corrections)*
Ref: HUD11762
ICOS No: 2016/90482;
2016/90769
Delivered: 01/06/2022
IN THE HIGH COURT OF JUSTICE IN NORTHERN IRELAND
___________
CHANCERY DIVISION
___________
ULSTER BANK LTD
v
MICHAEL ADRIAN TAGGART
and
JOHN DESMOND TAGGART
___________
Jacqueline Simpson QC with Peter Hopkins BL (instructed by Arthur Cox Solicitors)
for the Applicant
Monye Anyadike-Danes QC with Robert McCausland BL (instructed by
RJW Law Solicitors) for the Respondent
___________
HUDDLESTON J
Introduction
[1] The history of the litigation between the parties to this action is of
considerable vintage. By way of a short summary in December 2009 Ulster Bank
Limited and Bank of Ireland (“the Banks”) issued proceedings against Michael and
John Taggart (“the Taggarts”) to enforce payment under two Personal Guarantees
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(“the PGs”) that they had provided to the Banks in support of a group of
companies loosely called “the Taggart Group”. Mr John Taggart, I should say at
the outset, (as the parties agree) was medically unfit to participate in these
proceedings which were as a result advanced by Mr Michael Taggart on behalf of
both of the Taggarts.
[2] The Taggarts counterclaimed, seeking over £100m from the Banks on the
basis that they:
(i) had been induced to pay money (personally) into the Taggart Group to
ensure its survival, and
(ii) had suffered substantial personal losses, which contributed to the Taggart
Group being put into administration in October 2008.
[3] Mr Justice Burgess determined that particular action in favour of the Banks.
The outcome of the case was that the Bank obtained orders for payment on foot of
the PGs together with costs. For the purposes of this case I shall call this the “main
Taggart action”.
[4] Ulster Bank Limited (“Ulster Bank” and/or “the Bank”) sought to
enforce the Orders and, on 22 September 2016, it issued a Bankruptcy Petition
against each of the Taggarts. The petitions were based on amounts outstanding
in excess of £6m.
[5] The Taggarts obtained an Interim Order allowing them to put an Individual
Voluntary Arrangement proposal (“IVA”) to their creditors. The proposal
advanced by Mr Taggart was that a third party (a new company of which
Mr Michael Taggart’s son is the director) would introduce £75,000 which, after
costs, would net down to a dividend of 0.03p in the £ across the total unsecured
creditors (in value terms) of £213,551,002. As part of that IVA Michael Taggart
alleged that monies were owed to three particular creditors Messrs McCann,
Iampolski and Sauer (“the three disputed claims” and the “the three disputed
creditors” respectively). I observe in passing that the sums initially claimed for
within the IVA were generally for substantially smaller amounts than the sums
which are now in contention.
[6] On 9 March 2017 a Creditor’s Meeting was held to determine, inter alia,
what claims should be admitted for voting purposes. The notes of that meeting
record that (i) the Ulster Bank objected to the three disputed claims and that (ii)
the Taggarts, for their part, objected to the claim of Promontoria Eagle Limited
(“PEL”) as assignee of debts formerly owed to Anglo Irish Limited. In substance,
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if each party’s objections were upheld then (i) the three disputed creditors could
not vote in favour of the IVA nor (ii) PEL against it.
[7] The Chairman, Mr Gill, decided to include both the three disputed claims
and PEL’s claim (despite the various challenges) and provided written reasons
for their inclusion. In essence, under the provisions of Rule 5.20(6) Insolvency
Rules (NI) 1991 (“the rules”) he admitted the claims but noted the objections that
had been made in respect of each of them.
[8] On the basis that PEL’s claim was included, the creditors (together)
rejected the application for the IVA. The Bank’s position appears to have been
that whilst it did not accept the validity of the three disputed claims there was no
need for the Bank to take any further action as the IVA did not proceed. Matters,
however, did not stop there.
[9] What followed next was that on 11 April 2017, the Taggarts issued an
application challenging the admission of PEL’s claim. PEL did not defend that
challenge. The Bank then, however, issued a similar application in relation to the
three disputed claims on the basis (it says) that otherwise:
“… if the [Taggarts’] challenge is successful it [would]
have [had] the effect that the IVA [would have been]
approved, and therefore the [Ulster Bank] [wanted to
have] the ability to challenge the admission of the
[disputed claims] since if [Ulster Banks’] challenge is
successful the IVA proposal will remain rejected.”
[10] The application dated 28 April 2017 was initially listed for hearing before
Master Kelly on 21 June 2017.
[11] The parties filed affidavits and outlined the basis of their claims and
counterclaims, and added further supporting documentation that had not been
made available to Mr Gill.
[12] Some procedural issues arose before Master Kelly which I do not
rehearse in detail but suffice to say:
(i) The hearing, therefore, proceeded on the basis that it was an appeal
against the Chairman’s decision to admit the disputed claims (per Rule
5.20(6));
(ii) That no issue was taken as regards time (Master Kelly extended time as
she was entitled to do pursuant to Article 344 of the Insolvency (NI)
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