Agrimarche Ltd, Re

The company's obligation under exercised call options was to pay a cash sum calculated by reference to LIFFE or MATIF futures, not to deliver the commodity; options could be exercised at any time during their validity period, entitling the grantee to immediate cash payment; no implied term for deemed exercise of 'in the money' options at expiry; claims of option holders must be valued at the commencement of liquidation, not administration.

Parties: Company: Agrimarche Limited; Liquidator's Counsel: Sharif A Shivji
Jurisdiction: England and Wales
Judgment Date: 05 July 2010
Procedural Posture: Directions Application / Judgment
Outcome: Directions granted; liquidator to proceed on basis of creditors’ legal rights.
Legal Topics: Valuation of Option Contracts, Implied Terms, Liquidation Claims, Exercise of Options, Administration

Insolvency Contract Valuation of Option Contracts Implied Terms Liquidation Claims Exercise of Options Administration

Case Brief

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Parties

Agrimarche Limited

Company

Sharif A Shivji

Liquidator's Counsel

Procedural Posture

Directions Application / Judgment

Legal Issues

1 Whether exercised call options required physical delivery or cash settlement
2 Timing and mechanism of option exercise
3 Implied term of deemed exercise for 'in the money' options

Ratio Decidendi

Court Disposition

Directions granted; liquidator to proceed on basis of creditors’ legal rights.

Orders

Claims of option holders to be valued at commencement of liquidation.
Costs of application payable as expense of liquidation.