Mohammed Saleem Khawaja v Stela Stefanova & Ors

Mohammed Saleem Khawaja v Stela Stefanova & Ors

The Trust Deed was not a sham, as Ms Stefanova genuinely intended to create a trust for her daughter, but it was executed for the purpose of putting the property beyond the reach of Mr Khawaja, making it a transaction to defraud creditors under section 423 of the Insolvency Act 1986. The court set aside the Trust Deed and made the interim charging order final.

Parties
Petitioner: Mohammed Saleem Khawaja; First Respondent: Stela Stefanova; Second Respondent: BiotechnologiesUK Limited; Third Respondent: Dermamed Solutions Limited
Jurisdiction
England and Wales
Judgment Date
07 August 2025
Procedural Posture
Company/commercial / Final Hearing on Interim Charging Order and Validity of Trust Deed
Outcome
Trust Deed set aside as a transaction to defraud creditors; interim charging order made final.
Legal Topics
Sham Trusts, Transactions Defrauding Creditors, Charging Orders, Section 423 Insolvency Act 1986, Enforcement of Judgments
Company Law Insolvency Law Trusts Law Civil Procedure Sham Trusts Transactions Defrauding Creditors Charging Orders Section 423 Insolvency Act 1986 +1 more

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Parties

Mohammed Saleem Khawaja

Petitioner

Stela Stefanova

First Respondent

BiotechnologiesUK Limited

Second Respondent

Dermamed Solutions Limited

Third Respondent

Procedural Posture

Company/commercial / Final Hearing on Interim Charging Order and Validity of Trust Deed

Legal Issues

  1. 1 Whether the Trust Deed executed by Ms Stefanova was a sham instrument
  2. 2 Whether the Trust Deed was a transaction to defraud creditors under section 423 of the Insolvency Act 1986
  3. 3 Whether the interim charging order over Ms Stefanova’s property should be made final

Ratio Decidendi

The Trust Deed was not a sham, as Ms Stefanova genuinely intended to create a trust for her daughter, but it was executed for the purpose of putting the property beyond the reach of Mr Khawaja, making it a transaction to defraud creditors under section 423 of the Insolvency Act 1986. The court set aside the Trust Deed and made the interim charging order final.

Court Disposition

Trust Deed set aside as a transaction to defraud creditors; interim charging order made final.

Orders

  • The Trust Deed is set aside and declared void ab initio and of no effect pursuant to section 423 of the Insolvency Act 1986.
  • The interim charging order over Ms Stefanova’s property is made final in the sum of £92,586.73.