BCS Corporate Acceptances Ltd & Ors v Terry [2018] EWHC 2349 (QB) (07 September 2018)

BCS Corporate Acceptances Ltd & Ors v Terry [2018] EWHC 2349 (QB) (07 September 2018)

The interim third party debt order was not obtained by material non-disclosure or abuse of process. The funds in the solicitor's client account, to the extent they represented sums due to the Defendant, were subject to the interim order. However, only sums for which bills had been rendered and were due to the solicitors as at the date of service of the interim order could be set off and paid out; unbilled work in progress and sums held on account for future legal fees remained a debt due to the Defendant and were caught by the order. The question of the ultimate source of the funds and whether they were truly third party funds was not determined and was left for the full hearing.

Citation
[2018] EWHC 2349
Parties
Claimant: BCS Corporate Acceptances Limited; Claimant: BCS Offshore Funding Limited; Claimant: Mr John Taylor; Defendant: Daniel Terry
Jurisdiction
England and Wales
Judgment Date
07 September 2018
Procedural Posture
High Court Civil Proceedings (queen's Bench Division) / Interlocutory Application Regarding Freezing Injunction and Interim Third Party Debt Order
Outcome
Application to set aside or amend interim third party debt order refused; directions given regarding payment of legal fees subject to proof of due bills.
Legal Topics
Freezing Injunctions, Third Party Debt Orders, Solicitor Client Accounts, Non Disclosure, Abuse of Process, Priority of Legal Costs, Access to Justice
Civil Procedure Enforcement of Judgments Injunctions Freezing Injunctions Third Party Debt Orders Solicitor Client Accounts Non Disclosure Abuse of Process +2 more

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Parties

BCS Corporate Acceptances Limited

Claimant

BCS Offshore Funding Limited

Claimant

Mr John Taylor

Claimant

Daniel Terry

Defendant

Procedural Posture

High Court Civil Proceedings (queen's Bench Division) / Interlocutory Application Regarding Freezing Injunction and Interim Third Party Debt Order

Legal Issues

  1. 1 Whether funds in a solicitor's client account are subject to a freezing injunction and/or third party debt order
  2. 2 Whether the interim third party debt order should be set aside or amended to permit payment of legal fees
  3. 3 Whether there was material non-disclosure or abuse of process by the Claimants in obtaining the interim order

Ratio Decidendi

The interim third party debt order was not obtained by material non-disclosure or abuse of process. The funds in the solicitor's client account, to the extent they represented sums due to the Defendant, were subject to the interim order. However, only sums for which bills had been rendered and were due to the solicitors as at the date of service of the interim order could be set off and paid out; unbilled work in progress and sums held on account for future legal fees remained a debt due to the Defendant and were caught by the order. The question of the ultimate source of the funds and whether they were truly third party funds was not determined and was left for the full hearing.

Court Disposition

Application to set aside or amend interim third party debt order refused; directions given regarding payment of legal fees subject to proof of due bills.

Orders

  • No order permitting payment out of client account at this stage; Defendant may provide evidence of due bills for consideration.
  • No finding of non-disclosure or abuse of process by Claimants.