Hockin & Ors v Marsden & Ors [2014] EWHC 763 (Ch) (19 March 2014)

Hockin & Ors v Marsden & Ors [2014] EWHC 763 (Ch) (19 March 2014)

Administrators' refusal to assign the company's claims would unfairly harm the interests of the applicant creditor under paragraph 74, as at least one claim (misrepresentation as to a cost-free credit break) is viable and assignment would benefit creditors if successful. The statutory test is unfair harm, not perversity or differential treatment. Assignment should be ordered on the applicants' proposed terms, with appropriate indemnity for costs.

Citation
[2014] EWHC 763 (Ch)
Parties
Applicant: Diane Hockin; Applicant: Michael Hockin; Applicant: Lonwest Limited; Respondent (joint Administrator): Chris Marsden; Respondent (joint Administrator): Alan Bloom
Jurisdiction
England and Wales
Judgment Date
19 March 2014
Procedural Posture
Application Under Insolvency Act 1986, Schedule B1, Paragraph 74 / Judgment on Application to Direct Administrators to Assign Claims
Outcome
Application granted in part
Legal Topics
Assignment of Claims in Administration, Administrator's Duties, Standing of Applicants, Misrepresentation, Banking and Financial Instruments
Insolvency Law Company Law Assignment of Claims in Administration Administrator's Duties Standing of Applicants Misrepresentation Banking and Financial Instruments

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Parties

Diane Hockin

Applicant

Michael Hockin

Applicant

Lonwest Limited

Applicant

Chris Marsden

Respondent (joint Administrator)

Alan Bloom

Respondent (joint Administrator)

Procedural Posture

Application Under Insolvency Act 1986, Schedule B1, Paragraph 74 / Judgment on Application to Direct Administrators to Assign Claims

Legal Issues

  1. 1 Whether administrators' refusal to assign claims constitutes unfair harm under paragraph 74 of Schedule B1 to the Insolvency Act 1986
  2. 2 Whether the applicant has standing to seek relief under paragraph 74
  3. 3 Whether the proposed claims are frivolous or vexatious

Ratio Decidendi

Administrators' refusal to assign the company's claims would unfairly harm the interests of the applicant creditor under paragraph 74, as at least one claim (misrepresentation as to a cost-free credit break) is viable and assignment would benefit creditors if successful. The statutory test is unfair harm, not perversity or differential treatment. Assignment should be ordered on the applicants' proposed terms, with appropriate indemnity for costs.

Court Disposition

Application granted in part

Orders

  • Administrators directed to assign the company's claims arising out of alleged mis-selling (including misrepresentation as to credit break) to the applicants on proposed terms, including a 10% share of recoveries and a nominal lump sum.
  • Assignment to include indemnity by applicants for any third party costs orders, with evidence of means to be provided.