Lovett & Anor v Carson Country Homes Ltd & Ors

Lovett & Anor v Carson Country Homes Ltd & Ors

The debenture was valid in favour of Barclays Bank because section 44(5) of the Companies Act 2006 deems a document purporting to be executed by two authorised signatories as duly executed in favour of a bona fide purchaser for value. Mr Jewson had ostensible authority to warrant to the Bank that all formalities had been complied with, and Mr Carter had allowed Mr Jewson to handle all dealings with the Bank, including signing documents in his name. The Bank acted in good faith and for valuable consideration. Therefore, the appointment of the administrators was valid.

Parties
Applicant: Alan Lovett; Applicant: Geoffrey Lambert Carton-Kelly; Respondent: Carson Country Homes Ltd; Respondent: Barclays Bank PLC; Respondent: Registrar of Companies; Respondent: Andrew Alexander Jewson; Respondent: Edward Charles Carter
Jurisdiction
England and Wales
Judgment Date
01 May 2009
Procedural Posture
Company/commercial / Judgment After Contested Application
Outcome
application granted
Legal Topics
Execution of Company Documents, Forgery, Ostensible Authority, Appointment of Administrators, Debenture Validity, Estoppel
Company Law Insolvency Law Banking Law Execution of Company Documents Forgery Ostensible Authority Appointment of Administrators Debenture Validity +1 more

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Parties

Alan Lovett

Applicant

Geoffrey Lambert Carton-Kelly

Applicant

Carson Country Homes Ltd

Respondent

Barclays Bank PLC

Respondent

Registrar of Companies

Respondent

Andrew Alexander Jewson

Respondent

Edward Charles Carter

Respondent

Procedural Posture

Company/commercial / Judgment After Contested Application

Legal Issues

  1. 1 Whether the debenture appointing administrators was valid given allegations of forgery of a director's signature
  2. 2 Whether section 44 of the Companies Act 2006 validates a debenture executed with a forged signature in favour of a bona fide purchaser
  3. 3 Whether the company was estopped from denying the validity of the debenture

Ratio Decidendi

The debenture was valid in favour of Barclays Bank because section 44(5) of the Companies Act 2006 deems a document purporting to be executed by two authorised signatories as duly executed in favour of a bona fide purchaser for value. Mr Jewson had ostensible authority to warrant to the Bank that all formalities had been complied with, and Mr Carter had allowed Mr Jewson to handle all dealings with the Bank, including signing documents in his name. The Bank acted in good faith and for valuable consideration. Therefore, the appointment of the administrators was valid.

Court Disposition

application granted

Orders

  • Declaration that the appointment of the administrators was valid
  • Direction extending time for the administrators to send out proposals under schedule B1 of the Insolvency Act 1986