Maloney v Filtons Ltd & Anor [2012] EWHC 1395 (Ch) (24 May 2012)

Maloney v Filtons Ltd & Anor [2012] EWHC 1395 (Ch) (24 May 2012)

The lease was a sham or void; the true relationship was that of managing agent, not tenant. The Defendants are not entitled to remain in possession or manage the property until October 2012 due to breaches of trust and failure to account. The Defendants must account to the Receivers for all rents collected, less a 5% commission after deduction of costs incurred by the Receivers.

Citation
[2012] EWHC 1395 (Ch)
Parties
Claimant: George Maloney; Claimant: Bruce Mackay; Claimant: Graham Bushby; Claimant: Matthew Haw; Defendant: Filtons Limited; Defendant: Filtons Leasing (London) Ltd
Jurisdiction
England and Wales
Judgment Date
24 May 2012
Procedural Posture
Chancery Division Trial / Judgment After Expedited Trial
Outcome
Lease declared void or sham; Defendants found to be managing agents only; Defendants removed from management; Defendants to account to Receivers for rents collected, less 5% commission after costs; payment of £120,000 to McFeely to be repaid to Receivers.
Legal Topics
Sham Transactions, Letting Agency, Receivership, Estoppel, Void Lease, Management Agreement, Account of Profits
Property Law Equity and Trusts Landlord and Tenant Sham Transactions Letting Agency Receivership Estoppel Void Lease +2 more

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Parties

George Maloney

Claimant

Bruce Mackay

Claimant

Graham Bushby

Claimant

Matthew Haw

Claimant

Filtons Limited

Defendant

Filtons Leasing (London) Ltd

Defendant

Procedural Posture

Chancery Division Trial / Judgment After Expedited Trial

Legal Issues

  1. 1 Whether the lease granted to the Defendants was valid or a sham
  2. 2 Whether the Defendants' relationship with the McFeely Brothers was that of tenant or managing agent
  3. 3 Whether the Defendants are entitled to remain in possession or manage the property until October 2012

Ratio Decidendi

The lease was a sham or void; the true relationship was that of managing agent, not tenant. The Defendants are not entitled to remain in possession or manage the property until October 2012 due to breaches of trust and failure to account. The Defendants must account to the Receivers for all rents collected, less a 5% commission after deduction of costs incurred by the Receivers.

Court Disposition

Lease declared void or sham; Defendants found to be managing agents only; Defendants removed from management; Defendants to account to Receivers for rents collected, less 5% commission after costs; payment of £120,000 to McFeely to be repaid to Receivers.

Orders

  • Declaration that the lease is void or a sham.
  • Declaration that Defendants were managing agents only.