Hampton Capital Ltd, Re

Hampton Capital Ltd, Re

The Company is entitled to restitution from Elite Performance Cars Limited for £335,000 and from Oswald Kanzira for £157,000 as both were unjustly enriched by receipt of misappropriated company funds. The change of position defence succeeded for Mr Kanzira only in respect of the first £125,000 payment, as he acted in good faith and without knowledge, but failed for subsequent payments as he had reasonable grounds for suspicion. Claims under section 238 of the Insolvency Act 1986 failed as there was no transaction 'with' the recipients within the statutory meaning.

Parties
Applicant/joint Administrator: Anthony Murphy; Applicant/joint Administrator: Paul Robert Boyle; Claimant/company: Hampton Capital Limited; Respondent/defendant: Elite Performance Cars Limited; Respondent/defendant: Paul Commerford; Respondent/defendant: Oswald Kanzira; Respondent/defendant: Erkan Akbas
Jurisdiction
England and Wales
Judgment Date
09 July 2015
Procedural Posture
Insolvency/restitution/company Law / Judgment After Trial
Outcome
Judgment for the Claimants in part; claims under section 238 dismissed.
Legal Topics
Unjust Enrichment, Transactions at Undervalue, Change of Position Defence, Ministerial Receipt
Insolvency Law Company Law Restitution Unjust Enrichment Transactions at Undervalue Change of Position Defence Ministerial Receipt

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Parties

Anthony Murphy

Applicant/joint Administrator

Paul Robert Boyle

Applicant/joint Administrator

Hampton Capital Limited

Claimant/company

Elite Performance Cars Limited

Respondent/defendant

Paul Commerford

Respondent/defendant

Oswald Kanzira

Respondent/defendant

Erkan Akbas

Respondent/defendant

Procedural Posture

Insolvency/restitution/company Law / Judgment After Trial

Legal Issues

  1. 1 Whether payments made by Hampton Capital Limited to Elite Performance Cars Limited and Oswald Kanzira were recoverable as unjust enrichment
  2. 2 Whether section 238 of the Insolvency Act 1986 applies to the payments
  3. 3 Whether the change of position defence or ministerial receipt applies to Mr Kanzira

Ratio Decidendi

The Company is entitled to restitution from Elite Performance Cars Limited for £335,000 and from Oswald Kanzira for £157,000 as both were unjustly enriched by receipt of misappropriated company funds. The change of position defence succeeded for Mr Kanzira only in respect of the first £125,000 payment, as he acted in good faith and without knowledge, but failed for subsequent payments as he had reasonable grounds for suspicion. Claims under section 238 of the Insolvency Act 1986 failed as there was no transaction 'with' the recipients within the statutory meaning.

Court Disposition

Judgment for the Claimants in part; claims under section 238 dismissed.

Orders

  • Elite Performance Cars Limited to pay £335,000 to the Company.
  • Oswald Kanzira to pay £157,000 to the Company.