Burnden Holdings (UK) Ltd v Fielding & Anor

Burnden Holdings (UK) Ltd v Fielding & Anor

The claimants failed to prove that the distribution was unlawful or that the directors were at fault; the interim accounts enabled a reasonable judgment as to distributable profits; the directors reasonably relied on professional advice; the Grant of Security was for commercial benefit and not at an undervalue; BHUK was solvent at the material time; there was no dishonest breach of fiduciary duty or transaction defrauding creditors; and, even if there had been a technical breach, relief from liability would have been granted.

Parties
Claimant: Burnden Holdings (UK) Limited (In Liquidation); Claimant: Stephen John Hunt (As Liquidator of Burnden Holdings (UK) Limited); Defendant: Gary John Fielding; Defendant: Sally Anne Fielding
Jurisdiction
England and Wales
Judgment Date
19 June 2019
Procedural Posture
Civil / Judgment After Trial
Outcome
Claim dismissed
Legal Topics
Unlawful Distribution, Directors' Duties, Transaction at an Undervalue, Fiduciary Duty, Ratification, Relief From Liability, Valuation of Shares, Contingent Liabilities
Company Law Insolvency Law Unlawful Distribution Directors' Duties Transaction at an Undervalue Fiduciary Duty Ratification Relief From Liability +2 more

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Parties

Burnden Holdings (UK) Limited (In Liquidation)

Claimant

Stephen John Hunt (As Liquidator of Burnden Holdings (UK) Limited)

Claimant

Gary John Fielding

Defendant

Sally Anne Fielding

Defendant

Procedural Posture

Civil / Judgment After Trial

Legal Issues

  1. 1 Whether the distribution of shares in Vital Energi Utilities Limited was unlawful under the Companies Act 1985
  2. 2 Whether the directors are strictly or fault-based liable for unlawful distributions
  3. 3 Whether the Grant of Security was unauthorised or at an undervalue

Ratio Decidendi

The claimants failed to prove that the distribution was unlawful or that the directors were at fault; the interim accounts enabled a reasonable judgment as to distributable profits; the directors reasonably relied on professional advice; the Grant of Security was for commercial benefit and not at an undervalue; BHUK was solvent at the material time; there was no dishonest breach of fiduciary duty or transaction defrauding creditors; and, even if there had been a technical breach, relief from liability would have been granted.

Court Disposition

Claim dismissed