Equity Trust (J) Ltd -v- AG (Manchester) 21-Mar-2006 [2006] JRC 047 (21 March 2006)

Equity Trust (J) Ltd -v- AG (Manchester) 21-Mar-2006 [2006] JRC 047 (21 March 2006)

It is appropriate to order fortification of the cross-undertaking in damages in this case, as there is a real risk that the undertaking would be valueless without security, and there is no identified prejudice to the company or liquidators. The court need not await an authoritative English law ruling on the status of such claims under Rule 4.218.

Citation
[2006] JRC 047
Parties
Trustee/applicant: Equity Trust (Jersey) Limited; Company/respondent: AG Manchester Limited; Joint Liquidators: Paul Stanley and Michael Shorrocks
Jurisdiction
Jersey
Judgment Date
21 March 2006
Procedural Posture
Interlocutory Application in Liquidation Proceedings / Ruling on Fortification of Cross Undertaking in Damages
Outcome
Application for fortification granted
Legal Topics
Mareva Injunction, Cross Undertaking in Damages, Liquidation Expenses, Security for Undertaking
Insolvency Law Trust Law Civil Procedure Mareva Injunction Cross Undertaking in Damages Liquidation Expenses Security for Undertaking

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Parties

Equity Trust (Jersey) Limited

Trustee/applicant

AG Manchester Limited

Company/respondent

Paul Stanley and Michael Shorrocks

Joint Liquidators

Procedural Posture

Interlocutory Application in Liquidation Proceedings / Ruling on Fortification of Cross Undertaking in Damages

Legal Issues

  1. 1 Whether the company should be ordered to fortify its cross-undertaking in damages by providing security
  2. 2 If so, the amount and limitation of such security

Ratio Decidendi

It is appropriate to order fortification of the cross-undertaking in damages in this case, as there is a real risk that the undertaking would be valueless without security, and there is no identified prejudice to the company or liquidators. The court need not await an authoritative English law ruling on the status of such claims under Rule 4.218.

Court Disposition

Application for fortification granted

Orders

  • The company is ordered to provide security in the sum of £100,000 to fortify its cross-undertaking in damages.
  • The cross-undertaking in damages is in practice limited to the value of the net assets recovered by the liquidators.