Drax Holdings Ltd., Re [2003] EWHC 2743 (Ch) (17 November 2003)

Drax Holdings Ltd., Re [2003] EWHC 2743 (Ch) (17 November 2003)

The English court has jurisdiction under section 425 of the Companies Act 1985 to order meetings and sanction schemes of arrangement for foreign companies liable to be wound up under the Insolvency Act 1986. The three conditions for winding up foreign companies are matters of discretion, not jurisdiction, in the...

Source-derived case information.

Citation
[2003] EWHC 2743 (Ch)
Parties
Applicant: Drax Holdings Limited; Applicant: InPower Limited
Jurisdiction
England and Wales
Judgment Date
17 November 2003
Procedural Posture
Companies Court Application for Scheme of Arrangement / Order for Convening Meetings of Scheme Creditors Under Section 425(1) of the Companies Act 1985
Outcome
Orders made for convening meetings of scheme creditors for Drax Holdings Limited and InPower Limited under section 425(1) of the Companies Act 1985.
Legal Topics
Schemes of Arrangement, Jurisdiction Over Foreign Companies, Winding Up of Unregistered Companies
Insolvency Company Law Cross Border Insolvency Schemes of Arrangement Jurisdiction Over Foreign Companies Winding Up of Unregistered Companies

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Parties

Drax Holdings Limited

Applicant

InPower Limited

Applicant

Procedural Posture

Companies Court Application for Scheme of Arrangement / Order for Convening Meetings of Scheme Creditors Under Section 425(1) of the Companies Act 1985

Legal Issues

  1. 1 Whether the English court has jurisdiction under section 425 of the Companies Act 1985 to order meetings and sanction schemes of arrangement in respect of foreign companies (Drax Holdings and InPower)
  2. 2 Whether the three conditions for winding up foreign companies apply as jurisdictional preconditions to schemes of arrangement

Ratio Decidendi

The English court has jurisdiction under section 425 of the Companies Act 1985 to order meetings and sanction schemes of arrangement for foreign companies liable to be wound up under the Insolvency Act 1986. The three conditions for winding up foreign companies are matters of discretion, not jurisdiction, in the context of schemes of arrangement. The court will only exercise jurisdiction where there is a sufficient connection with England, which exists in this case due to the governing law of the relevant instruments, location of assets, and involvement of English creditors.

Court Disposition

Orders made for convening meetings of scheme creditors for Drax Holdings Limited and InPower Limited under section 425(1) of the Companies Act 1985.

Orders

  • Drax Holdings Limited and InPower Limited to convene meetings of scheme creditors to consider and, if thought fit, approve their respective Schemes of Arrangement.