Cabvision Ltd v Feetum & Ors

Cabvision Ltd v Feetum & Ors

The respondents had standing as Designated Members directly affected by the appointment of administrative receivers. The appointment was prohibited by section 72A of the Insolvency Act 1986, as the project did not meet the requirements of the 'project finance' exception in section 72E: the relevant agreement was the...

Source-derived case information.

Parties
Appellant: Cabvision Limited; Respondent: Leonard Paul Feetum; Respondent: Stephen Richard Marsden; Respondent: Simon Alan Smith
Jurisdiction
England and Wales
Judgment Date
20 December 2005
Procedural Posture
Civil Appeal / Appeal From High Court (chancery Division) to Court of Appeal
Outcome
Appeal dismissed
Legal Topics
Appointment of Administrative Receivers, Standing (locus Standi), Interpretation of Insolvency Act 1986 and Enterprise Act 2002, Declaratory Relief, Project Finance Exception, Limited Liability Partnerships
Insolvency Law Company Law Appointment of Administrative Receivers Standing (locus Standi) Interpretation of Insolvency Act 1986 and Enterprise Act 2002 Declaratory Relief Project Finance Exception Limited Liability Partnerships

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Parties

Cabvision Limited

Appellant

Leonard Paul Feetum

Respondent

Stephen Richard Marsden

Respondent

Simon Alan Smith

Respondent

Procedural Posture

Civil Appeal / Appeal From High Court (chancery Division) to Court of Appeal

Legal Issues

  1. 1 Whether the respondents had standing to challenge the appointment of administrative receivers over the LLP
  2. 2 Whether the appointment of administrative receivers was prohibited by the Insolvency Act 1986 as amended by the Enterprise Act 2002
  3. 3 Whether the project fell within the 'project finance' exception under section 72E of the Insolvency Act 1986

Ratio Decidendi

The respondents had standing as Designated Members directly affected by the appointment of administrative receivers. The appointment was prohibited by section 72A of the Insolvency Act 1986, as the project did not meet the requirements of the 'project finance' exception in section 72E: the relevant agreement was the Facility Agreement, and there was no sufficient expectation of incurring a debt of at least £50 million. The power to appoint administrative receivers did not constitute 'step-in rights' under the statutory definition. The appointment was therefore invalid.

Court Disposition

Appeal dismissed

Orders

  • Declaration that the appointment of Mr Levy and Mr Berman as administrative receivers of the LLP was invalid and prohibited by the Insolvency Act 1986