Delaney v Chen & Anor

Delaney v Chen & Anor

The victims failed to discharge the burden of proving that the transaction was at an undervalue, as the tenancy granted to the sellers had a value of £65,000, making the total consideration equal to the unencumbered value. Therefore, section 423 did not apply and the appeal was allowed.

Parties
Appellant: Mr. Paul Delaney; Respondent: Mrs. Can Chen; Respondent: Mr. An Xiang Du
Jurisdiction
England and Wales
Judgment Date
08 January 2010
Procedural Posture
Civil Appeal / Judgment on Appeal
Outcome
appeal allowed
Legal Topics
Transaction at Undervalue, Sale and Lease Back, Section 423 Insolvency Act 1986, Creditor Protection
Insolvency Law Property Law Transaction at Undervalue Sale and Lease Back Section 423 Insolvency Act 1986 Creditor Protection

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Parties

Mr. Paul Delaney

Appellant

Mrs. Can Chen

Respondent

Mr. An Xiang Du

Respondent

Procedural Posture

Civil Appeal / Judgment on Appeal

Legal Issues

  1. 1 Whether the sale and lease back transaction was a transaction at an undervalue under section 423 of the Insolvency Act 1986
  2. 2 Whether the requisite statutory purpose to prejudice creditors was established

Ratio Decidendi

The victims failed to discharge the burden of proving that the transaction was at an undervalue, as the tenancy granted to the sellers had a value of £65,000, making the total consideration equal to the unencumbered value. Therefore, section 423 did not apply and the appeal was allowed.

Court Disposition

appeal allowed

Orders

  • Order of District Judge Ingram set aside
  • Section 423 application dismissed