Burdale Financial Ltd v Agilo Master Fund Ltd

Burdale Financial Ltd v Agilo Master Fund Ltd

The Default Letter did not constitute 'the first step of such action' under Clause 11(i) of the Intercreditor Deed. The action referred to is the actual acceleration or declaration, which occurs at a point in time. Notice of intention must be given before the process is started, and the Junior Creditor did not comply with the notice requirements. The submissions of the Senior Creditor and Debtor are correct; the Junior Creditor's construction is rejected.

Parties
Claimant: Burdale Financial Limited; Claimant: Abbeycrest PLC; Defendant: Agilo Master Fund Limited
Jurisdiction
England and Wales
Judgment Date
19 May 2008
Procedural Posture
Civil / Trial of Part 8 Claim and Preliminary Issue in Part 7 Claim
Outcome
Declarations granted in favour of Senior Creditor and Debtor; Junior Creditor's construction rejected.
Legal Topics
Intercreditor Deed Interpretation, Priority of Debts, Enforcement Restrictions
Commercial Law Contract Law Intercreditor Deed Interpretation Priority of Debts Enforcement Restrictions

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Parties

Burdale Financial Limited

Claimant

Abbeycrest PLC

Claimant

Agilo Master Fund Limited

Defendant

Procedural Posture

Civil / Trial of Part 8 Claim and Preliminary Issue in Part 7 Claim

Legal Issues

  1. 1 Proper construction of Clause 11 of the Intercreditor Deed
  2. 2 Whether the Default Letter constitutes 'the first step of such action' under Clause 11(i)
  3. 3 Compliance with notice and timing requirements for enforcement by Junior Creditor

Ratio Decidendi

The Default Letter did not constitute 'the first step of such action' under Clause 11(i) of the Intercreditor Deed. The action referred to is the actual acceleration or declaration, which occurs at a point in time. Notice of intention must be given before the process is started, and the Junior Creditor did not comply with the notice requirements. The submissions of the Senior Creditor and Debtor are correct; the Junior Creditor's construction is rejected.

Court Disposition

Declarations granted in favour of Senior Creditor and Debtor; Junior Creditor's construction rejected.

Orders

  • Declarations as sought in the Part 8 claim granted.
  • Declarations as sought in paragraphs 5B and 5C of the Part 7 claim granted.