Hurst v Bennett & Ors [2001] EWCA Civ 182 (16 February 2001)

Hurst v Bennett & Ors [2001] EWCA Civ 182 (16 February 2001)

The appeal fails because Mr Hurst's cross-demand lacks mutuality with the trustees' claim for indemnity under the lease; the trustees' claim is personal and not as partners, while Mr Hurst's claim is against all partners jointly. Further, no substantive cross-claim exists that could justify setting aside the statutory demand, as any entitlement must be established through partnership accounts, which have not been taken and are unlikely to be taken.

Citation
[2001] EWCA Civ 182
Parties
Appellant: Robert Hurst; Respondents: Margaret Bennett and others
Jurisdiction
England and Wales
Judgment Date
16 February 2001
Procedural Posture
Appeal / Judgment on Appeal From High Court, Chancery Division
Outcome
appeal dismissed
Legal Topics
Statutory Demand, Counterclaim, Mutuality, Partnership Dissolution, Indemnity, Cross Demand
Insolvency Partnership Law Statutory Demand Counterclaim Mutuality Partnership Dissolution Indemnity Cross Demand

Case Brief

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Parties

Robert Hurst

Appellant

Margaret Bennett and others

Respondents

Procedural Posture

Appeal / Judgment on Appeal From High Court, Chancery Division

Legal Issues

  1. 1 Whether a debtor can set aside a statutory demand under Insolvency Rule 6.5(4)(a) based on a cross-demand against former partners lacking mutuality
  2. 2 Whether trustees can claim indemnity for rent before final partnership accounts are drawn up
  3. 3 Whether the debtor's cross-claim is substantive and can be brought before final accounts

Ratio Decidendi

The appeal fails because Mr Hurst's cross-demand lacks mutuality with the trustees' claim for indemnity under the lease; the trustees' claim is personal and not as partners, while Mr Hurst's claim is against all partners jointly. Further, no substantive cross-claim exists that could justify setting aside the statutory demand, as any entitlement must be established through partnership accounts, which have not been taken and are unlikely to be taken.

Court Disposition

appeal dismissed

Orders

  • Appeal dismissed with costs assessed at £5,000 VAT inclusive.
  • Leave to appeal to the House of Lords refused.