Wilson & Anor v Masters International Ltd.& Anor

Wilson & Anor v Masters International Ltd.& Anor

The payments of £200,000 and £250,000 made by OPL to MIL in April 2001 were preferences within the meaning of section 239 of the Insolvency Act 1986, as OPL was influenced by a desire to put MIL in a better position in the event of insolvent liquidation. MIL is liable to repay these sums, less appropriate credits....

Source-derived case information.

Parties
Applicant: Mark John Wilson; Applicant: Oxford Pharmaceuticals Limited; Respondent: Masters International Limited; Respondent: Dr Zulfikar Masters
Jurisdiction
England and Wales
Judgment Date
10 July 2009
Procedural Posture
Insolvency/company Law Application / Judgment After Trial
Outcome
Partial judgment for the applicants; orders for repayment by MIL and Dr Masters as specified; further argument to be heard on deductions, interest, and costs.
Legal Topics
Preferences, Voidable Transactions, Director's Fiduciary Duties, Misfeasance, Winding Up, Remedies Under Insolvency Act
Insolvency Law Company Law Preferences Voidable Transactions Director's Fiduciary Duties Misfeasance Winding Up Remedies Under Insolvency Act

Source-derived case record

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Parties

Mark John Wilson

Applicant

Oxford Pharmaceuticals Limited

Applicant

Masters International Limited

Respondent

Dr Zulfikar Masters

Respondent

Procedural Posture

Insolvency/company Law Application / Judgment After Trial

Legal Issues

  1. 1 Whether payments by Oxford Pharmaceuticals Limited (OPL) to Masters International Limited (MIL) in April 2001 were voidable preferences under section 239 of the Insolvency Act 1986.
  2. 2 Whether Dr Zulfikar Masters was liable as a recipient of a preference or for misfeasance as a director.
  3. 3 Whether payments by OPL to MIL in October and November 2001 were void under section 127 of the Insolvency Act 1986 and recoverable from MIL and/or Dr Masters.

Ratio Decidendi

The payments of £200,000 and £250,000 made by OPL to MIL in April 2001 were preferences within the meaning of section 239 of the Insolvency Act 1986, as OPL was influenced by a desire to put MIL in a better position in the event of insolvent liquidation. MIL is liable to repay these sums, less appropriate credits. Dr Masters was not a direct recipient of a preference and is not liable under section 239 or for misfeasance in respect of these payments. The four payments totalling £115,000 made in October and November 2001 were void under section 127 and recoverable from MIL; Dr Masters is liable for breach of fiduciary duty in authorising these payments and must contribute £115,000 to OPL's...

Court Disposition

Partial judgment for the applicants; orders for repayment by MIL and Dr Masters as specified; further argument to be heard on deductions, interest, and costs.

Orders

  • MIL to repay OPL £450,000 less £36,000 credit and any further deductions to be determined.
  • MIL to repay OPL £115,000 for void payments under section 127 of the Insolvency Act 1986.