Whalley v Doney & Anor

Whalley v Doney & Anor

The company was insolvent on a cash flow basis at the time of the transaction. Mr Doney, as a director, breached his fiduciary duties by diverting a substantial portion of the sale proceeds to himself. The trial judge's findings of fact were well-founded and there was no basis for appellate interference. Relief under section 727 was properly refused as this was not an appropriate case for its exercise.

Parties
Applicant/respondent: Alan Peter Whalley (Liquidator of MDA Investment Management Limited); Respondent/applicant: George Malcolm Doney; Respondent/applicant: Malcolm Doney Associates (A Firm)
Jurisdiction
England and Wales
Judgment Date
09 July 2004
Procedural Posture
Civil Appeal / Application for Permission to Appeal
Outcome
Permission to appeal refused with costs
Legal Topics
Misfeasance, Breach of Fiduciary Duty, Director's Duties, Relief Under Section 727, Unlawful Preferences
Company Law Insolvency Law Misfeasance Breach of Fiduciary Duty Director's Duties Relief Under Section 727 Unlawful Preferences

Case Brief

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Parties

Alan Peter Whalley (Liquidator of MDA Investment Management Limited)

Applicant/respondent

George Malcolm Doney

Respondent/applicant

Malcolm Doney Associates (A Firm)

Respondent/applicant

Procedural Posture

Civil Appeal / Application for Permission to Appeal

Legal Issues

  1. 1 Whether the division of sale proceeds constituted misfeasance and breach of fiduciary duty
  2. 2 Whether the company was insolvent at the relevant times
  3. 3 Whether relief under section 727 should be granted to Mr Doney

Ratio Decidendi

The company was insolvent on a cash flow basis at the time of the transaction. Mr Doney, as a director, breached his fiduciary duties by diverting a substantial portion of the sale proceeds to himself. The trial judge's findings of fact were well-founded and there was no basis for appellate interference. Relief under section 727 was properly refused as this was not an appropriate case for its exercise.

Court Disposition

Permission to appeal refused with costs

Orders

  • Application for permission to appeal refused
  • Costs assessed in the sum of £5,000 payable by the applicants