Madison Pacific Trust Limited v Squaretwo Capital Limited & Anor

Madison Pacific Trust Limited v Squaretwo Capital Limited & Anor

The definition of 'Relevant Date' in Condition 8(ii) unambiguously requires receipt of all contractually due sums before the prescription period can run; as this will never occur, the trust would otherwise continue indefinitely. The Trustee's proposals to amend the Deeds and reduce the prescription period are rational, within its powers, and in the interests of bondholders as a class. It is lawful for only Known Bondholders to vote on the amendments, and the Trustee may administer the trusts in accordance with the amendments if approved.

Parties
Claimant: Madison Pacific Trust Limited; First Defendant: Squaretwo Capital Limited; Second Defendant: Basil Vasilou
Jurisdiction
England and Wales
Judgment Date
11 October 2024
Procedural Posture
Civil (trusts/finance) / Judgment on Application for Directions and Declarations
Outcome
Declarations and directions granted as sought by the Trustee; Trustee's proposed actions approved.
Legal Topics
Interpretation of Trust Deeds, Bearer Bonds Prescription, Trustee Powers and Directions, Bondholder Meetings and Amendments
Trust Law Contract Law Insolvency Law Interpretation of Trust Deeds Bearer Bonds Prescription Trustee Powers and Directions Bondholder Meetings and Amendments

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Parties

Madison Pacific Trust Limited

Claimant

Squaretwo Capital Limited

First Defendant

Basil Vasilou

Second Defendant

Procedural Posture

Civil (trusts/finance) / Judgment on Application for Directions and Declarations

Legal Issues

  1. 1 Proper construction of 'Relevant Date' under Conditions 8 and 9 of the Bonds
  2. 2 Whether the Trustee may lawfully convene meetings to amend Conditions 8 and 9
  3. 3 Whether only Known Bondholders may lawfully vote on amendments

Ratio Decidendi

The definition of 'Relevant Date' in Condition 8(ii) unambiguously requires receipt of all contractually due sums before the prescription period can run; as this will never occur, the trust would otherwise continue indefinitely. The Trustee's proposals to amend the Deeds and reduce the prescription period are rational, within its powers, and in the interests of bondholders as a class. It is lawful for only Known Bondholders to vote on the amendments, and the Trustee may administer the trusts in accordance with the amendments if approved.

Court Disposition

Declarations and directions granted as sought by the Trustee; Trustee's proposed actions approved.

Orders

  • Declaration as to the meaning of 'Relevant Date' under Conditions 8 and 9 in favour of the Trustee's interpretation.
  • Approval for the Trustee to convene meetings of Bondholders to propose amendments to Conditions 7, 8, and 9.