South Bank Hotel Management Company Limited v Galliard Hotels Limited & Ors

South Bank Hotel Management Company Limited v Galliard Hotels Limited & Ors

Section 21(1)(b) of the Limitation Act 1980 applies to South Bank's claim against Mr Conway as a director/trustee because the grant of the Lease and Underlease constituted a conversion of trust property to his use, so the claim is not statute-barred; clause 9 of the Room Leases imposed a continuing obligation on Hotels, which was breached on a continuing basis, entitling South Bank to damages; section 44(5) of the Companies Act 2006 does not validate the Lease and Underlease because the purchasers were not in good faith, and South Bank is not estopped from denying due execution; the issues of equitable effect and rectification of the register are remitted for determination.

Parties
Claimant/appellant and Defendant/appellant: South Bank Hotel Management Company Limited; Defendant/respondent: Galliard Hotels Limited; Defendant/respondent: Stephen Stuart Solomon Conway; Defendant/respondent: Christopher John Duffy; Defendant/respondent and Claimant/respondent: Lodgeshine Limited; Defendant/respondent: Galliard Homes Limited
Jurisdiction
England and Wales
Judgment Date
02 June 2026
Procedural Posture
Civil Appeal / Court of Appeal Judgment on Appeal From High Court
Outcome
Appeal allowed in part; certain orders of the High Court set aside; matters remitted for further determination.
Legal Topics
Directors' Duties, Limitation of Actions, Execution of Deeds by Companies, Breach of Lease, Estoppel, Equitable Remedies
Company Law Property Law Contract Law Equity and Trusts Directors' Duties Limitation of Actions Execution of Deeds by Companies Breach of Lease +2 more

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Parties

South Bank Hotel Management Company Limited

Claimant/appellant and Defendant/appellant

Galliard Hotels Limited

Defendant/respondent

Stephen Stuart Solomon Conway

Defendant/respondent

Christopher John Duffy

Defendant/respondent

Lodgeshine Limited

Defendant/respondent and Claimant/respondent

Galliard Homes Limited

Defendant/respondent

Procedural Posture

Civil Appeal / Court of Appeal Judgment on Appeal From High Court

Legal Issues

  1. 1 Whether the claim against Mr Conway is statute-barred or falls within section 21(1)(b) of the Limitation Act 1980
  2. 2 Whether South Bank can claim damages from Hotels for breach of the Room Leases or if such claim is statute-barred
  3. 3 Whether the Lease and Underlease were validly executed as deeds under section 44 of the Companies Act 2006

Ratio Decidendi

Section 21(1)(b) of the Limitation Act 1980 applies to South Bank's claim against Mr Conway as a director/trustee because the grant of the Lease and Underlease constituted a conversion of trust property to his use, so the claim is not statute-barred; clause 9 of the Room Leases imposed a continuing obligation on Hotels, which was breached on a continuing basis, entitling South Bank to damages; section 44(5) of the Companies Act 2006 does not validate the Lease and Underlease because the purchasers were not in good faith, and South Bank is not estopped from denying due execution; the issues of equitable effect and rectification of the register are remitted for determination.

Court Disposition

Appeal allowed in part; certain orders of the High Court set aside; matters remitted for further determination.

Orders

  • Set aside paragraphs 1, 3 and 6 of the High Court order dated 12 November 2024 (stamped 21 November 2024)
  • Remit to the High Court for determination of the merits of the claim against Mr Conway and possible relief under section 1157 of the Companies Act 2006