Moss Groundworks Ltd, Re The Insolvency Act 1986 [2019] EWHC 2825 (Ch) (06 September 2019)

Moss Groundworks Ltd, Re The Insolvency Act 1986 [2019] EWHC 2825 (Ch) (06 September 2019)

The court declined to make an administration order due to inadequate information regarding compliance with SIP 16 marketing essentials and insufficient explanation for the proposed sale to a connected party at a value significantly below book value. The court was not satisfied that the process was not being abused to the disadvantage of creditors.

Citation
[2019] EWHC 2825 (Ch)
Parties
Applicant Company: Moss Groundworks Limited
Jurisdiction
England and Wales
Judgment Date
06 September 2019
Procedural Posture
Administration Application Under Insolvency Act 1986 / Interlocutory Hearing on Application for Administration Order
Outcome
Application adjourned
Legal Topics
Administration Order, Pre Pack Sale, SIP 16 Compliance, Marketing of Insolvent Business, Connected Party Transactions
Insolvency Company Law Administration Order Pre Pack Sale SIP 16 Compliance Marketing of Insolvent Business Connected Party Transactions

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Parties

Moss Groundworks Limited

Applicant Company

Procedural Posture

Administration Application Under Insolvency Act 1986 / Interlocutory Hearing on Application for Administration Order

Legal Issues

  1. 1 Whether the statutory requirements for an administration order are satisfied
  2. 2 Whether the proposed pre-pack sale process complies with SIP 16 and achieves the best outcome for creditors
  3. 3 Whether the court should exercise its discretion to make an administration order in light of concerns about abuse of process

Ratio Decidendi

The court declined to make an administration order due to inadequate information regarding compliance with SIP 16 marketing essentials and insufficient explanation for the proposed sale to a connected party at a value significantly below book value. The court was not satisfied that the process was not being abused to the disadvantage of creditors.

Court Disposition

Application adjourned

Orders

  • Application for administration order adjourned to allow further evidence and reconsideration of marketing process and SIP 16 compliance.