Business Mortgage Finance 6 Plc v Roundstone Technologies Ltd [2019] EWHC 2917 (Ch) (22 October 2019)

Business Mortgage Finance 6 Plc v Roundstone Technologies Ltd [2019] EWHC 2917 (Ch) (22 October 2019)

GHL and PLL were not validly appointed as trustees and thus had no power to appoint Mr Oyekoya as receiver; Mr Oyekoya had neither actual nor ostensible authority to execute the Sale and Purchase Agreement on behalf of BMF6; Roundstone was on enquiry due to the unusual terms of the transaction and failed to make reasonable enquiries; protections for purchasers in the Deed of Charge did not apply as there was no valid trustee or receiver; therefore, the Sale and Purchase Agreement is not binding on BMF6 and Roundstone did not acquire title to the assets.

Citation
[2019] EWHC 2917 (Ch)
Parties
Claimant: Business Mortgage Finance 6 PLC; Defendant: Roundstone Technologies Ltd
Jurisdiction
England and Wales
Judgment Date
22 October 2019
Procedural Posture
Part 8 Claim / Trial Judgment
Outcome
Claim allowed for the claimant; Sale and Purchase Agreement declared not binding on BMF6.
Legal Topics
Securitisation, Trust Deeds, Appointment of Trustees, Receivership, Ostensible Authority, Bona Fide Purchaser, Agency Law
Commercial Law Trusts and Equity Banking and Finance Securitisation Trust Deeds Appointment of Trustees Receivership Ostensible Authority +2 more

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Parties

Business Mortgage Finance 6 PLC

Claimant

Roundstone Technologies Ltd

Defendant

Procedural Posture

Part 8 Claim / Trial Judgment

Legal Issues

  1. 1 Whether GHL and PLL were validly appointed as trustees under the Trust Deed
  2. 2 Whether Mr Oyekoya was validly appointed as receiver of BMF6
  3. 3 Whether the Sale and Purchase Agreement executed by Mr Oyekoya on behalf of BMF6 is binding on BMF6

Ratio Decidendi

GHL and PLL were not validly appointed as trustees and thus had no power to appoint Mr Oyekoya as receiver; Mr Oyekoya had neither actual nor ostensible authority to execute the Sale and Purchase Agreement on behalf of BMF6; Roundstone was on enquiry due to the unusual terms of the transaction and failed to make reasonable enquiries; protections for purchasers in the Deed of Charge did not apply as there was no valid trustee or receiver; therefore, the Sale and Purchase Agreement is not binding on BMF6 and Roundstone did not acquire title to the assets.

Court Disposition

Claim allowed for the claimant; Sale and Purchase Agreement declared not binding on BMF6.

Orders

  • Declaration that GHL and PLL were not validly appointed as trustees under the Trust Deed.
  • Declaration that Mr Oyekoya was not validly appointed as receiver of BMF6.