Kidd and Ors v All Services Group Holdings Limited and Ors 05-Nov-2019 [2019] JRC 221 (05 November 2019)

Kidd and Ors v All Services Group Holdings Limited and Ors 05-Nov-2019 [2019] JRC 221 (05 November 2019)

There is a realistic prospect of a claim against CarVal generating a surplus, giving shareholders a legitimate interest in the winding up and standing to seek appointment of additional liquidators. Joint Liquidators, funded by CarVal and committed to the Aeon Report, are not appropriate to pursue the claim. Additional liquidators should be appointed to investigate and, if appropriate, pursue the claim against CarVal, with delineation of responsibilities and directions as to funding, costs, and conduct.

Citation
[2019] JRC 221
Parties
Representor/shareholder: Robert Gordon Kidd; Representor/shareholder: Milan Balac; Representor/shareholder: Lee Brian Cox; Substantial Creditor: CVI CVF III Lux Finance Sarl; Substantial Creditor: EOC Lux Finance Sarl; Substantial Creditor: CarVal Investors GB LLP; Joint Liquidator: Malcolm Cohen; Joint Liquidator: Philip Braun; Additional Liquidator: Adrian Rabet; Additional Liquidator: Darren Reeds
Jurisdiction
Jersey
Judgment Date
05 November 2019
Procedural Posture
Creditors' Winding Up Representation / Appointment of Additional Liquidators and Directions
Outcome
Appointment of additional liquidators; directions issued; stay of dividend proceedings; review in 6 months.
Legal Topics
Appointment/removal of Liquidators, Valuation of Collateral, Conflict of Interest, Locus Standi, Distribution of Assets
Insolvency Company Law Secured Transactions Appointment/removal of Liquidators Valuation of Collateral Conflict of Interest Locus Standi Distribution of Assets

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Parties

Robert Gordon Kidd

Representor/shareholder

Milan Balac

Representor/shareholder

Lee Brian Cox

Representor/shareholder

CVI CVF III Lux Finance Sarl

Substantial Creditor

EOC Lux Finance Sarl

Substantial Creditor

CarVal Investors GB LLP

Substantial Creditor

Malcolm Cohen

Joint Liquidator

Philip Braun

Joint Liquidator

Adrian Rabet

Additional Liquidator

Darren Reeds

Additional Liquidator

Procedural Posture

Creditors' Winding Up Representation / Appointment of Additional Liquidators and Directions

Legal Issues

  1. 1 Is there a realistic prospect of a claim by ASGH against CarVal generating a surplus over the sums due to CarVal?
  2. 2 Who should investigate and, if appropriate, bring that claim?
  3. 3 Do the shareholders have locus standi to seek removal or appointment of liquidators in a creditors' winding up?

Ratio Decidendi

There is a realistic prospect of a claim against CarVal generating a surplus, giving shareholders a legitimate interest in the winding up and standing to seek appointment of additional liquidators. Joint Liquidators, funded by CarVal and committed to the Aeon Report, are not appropriate to pursue the claim. Additional liquidators should be appointed to investigate and, if appropriate, pursue the claim against CarVal, with delineation of responsibilities and directions as to funding, costs, and conduct.

Court Disposition

Appointment of additional liquidators; directions issued; stay of dividend proceedings; review in 6 months.

Orders

  • Joint Liquidators to remain in office with exclusive conduct of liquidation except for CarVal claim.
  • Additional Liquidators (Adrian Rabet and Darren Reeds) appointed with exclusive conduct of CarVal claim.