Representation of Barclays Bank Plc re Marketgait Property Investment Limited (Royal Court : Hearing (Civil) : Temple : Letters of Request) [2026] JRC 096 (14 April 2026)

judgment the deputy bailiff: 1. On 13 February 2026, the Court granted the application of Barclays Bank PLC ("Barclays") to issue a Letter of Request seeking the assistance of the Court of Session in Scotland to place the Respondent (" Marketgait " or the "Company") into administration under the UK Insolvency Act 1986 (the "1986 Act") for the benefit of its creditors.

2. The Court sat with the learned Jurats, although the making of an order seeking aid from a Court outside Jersey exercising jurisdiction in relation to insolvency is one of the matters listed in Royal Court Rule 17/2 as non-contentious business which may be transacted before the Bailiff. Facts 3. Marketgait is a company incorporated in Jersey under registered number 126970. The principal asset of the Company is its freehold interest in real property, known as Marketgait Apartments in Dundee, Scotland, which is registered in the Scottish Land Register under title number ANG28402 (the "Property"). The Property comprises one hundred and sixteen units of student accommodation and generates rental income. The Company is registered for Jersey Income Tax purposes at a zero rate but has no employees nor has it previously had any employees. Therefore, Marketgait has no obligation to make any income tax payments or social security payments and has no preferential creditors.

4. The Representor ("Barclays") is a lender to and is the sole secured creditor of the Company pursuant to an English law facility agreement dated 3 October 2018 as amended and restated (the "Facility"). Directors of the Company, the company secretary and administration of the Company are all provided through various corporate services companies via Ocorian Fund Services (Jersey) Limited (" Ocorian ") who are unsecured creditors, as is Bedell Cristin, which provided legal services to the Company.

5. The sole shareholder of the Company is Marketgait Investment Holdings Limited, a Jersey incorporated company ("MIH"). MIH is also an unsecured creditor of the Company pursuant to an unsecured loan made instrument with a face value of £1,925,000 bearing interest at 7% per annum (the "Subordinated Loan Note"). Other unsecured creditors of the Company include Rasameel Investment Company KSCC (" Rasameel ") and 90 North Real Estate Partners LLP ("90 North") who are respectively a company incorporated in Kuwait, and an LLP registered in England and Wales and who provided investors or investment services to Marketgait .

6. As set out in the affidavit of Mr James Angus, a director in the Special Asset Management division of Barclays, Marketgait failed to repay the principal amount of £5,700,000 due under the Facility with Barclays on 31 October 2025, together with accrued interest of £60,997.81 as at the same date. In addition, the Subordinated Loan Note debt in the amount of £1,925,000 plus interest was not repaid to the shareholder MIH when due on 28 December 2025. Barclays engaged with investors in the Company who have indicated that no further financial support will be provided.

7. Marketgait is therefore insolvent on a cashflow basis in that it is unable to pay its debts as they fall due. In addition, an affidavit provided by Mr Chad Griffin, a licenced insolvency practitioner, opines that Marketgait is likely to be insolvent on a balance sheet basis. A problem has arisen in relation to cladding at the Property, the remediation costs of which are estimated to be substantial. The most recent financial statements for the Company indicated that its net assets were £2,050,563 albeit this was based on a valuation of the Property carried out on 5 April 2019 which provided a net book value for the Property of £9,878,000. However, the net asset figure of £2,050,563 did not take account of the costs of remediation of the cladding problem. Mr Griffin therefore opines that, if these were taken into account, the Company would be in a net liability position and therefore is likely to be balance sheet insolvent. Procedural history 8. Draft versions of the Representation and supporting affidavits were first provided to the Viscount's Department for comment, and a representative of the Viscount was present at the substantive hearing. The Representation was first presented to the Court on 9 January 2026 where the Court granted convening and service orders, including permission to serve Rasameel and 90 North out of the jurisdiction with orders for substituted service. The Company was convened to the proceedings, as were the main unsecured creditors, namely: (i) MIH, the Company's shareholder; (ii) Ocorian , the corporate services provider to the Company; (iii) Rasameel ; (iv) 90 North; and (v) Bedell Cristin.

9. Liberty to apply to intervene was also granted to any other creditor. Each of the Respondents were validly served as ordered by the Court.

10. By letter dated 19 December 2025, Marketgait had previously confirmed that it consented to the application to issue a letter of request to place it into administration in Scotland. Ocorian further confirmed that it would hold any funds under its control to the order of the intended administrators and that it would provide cooperation and assistance to them. All the convened unsecured creditors confirmed that they would not be appearing and none of the Respondents appeared at the return date for the proceedings which was held on 23 January 2026. None of the Respondents filed any affidavit evidence which was required to be served by 30 January 2026 and the substantive application heard by the Court on 13 February 2026 proceeded on an unopposed basis. At that hearing the Court was grateful to Mr Williams for his written and oral submissions. Legal principles 11. The inherent jurisdiction of the Royal Court to issue a letter of request as a discretionary remedy to place a Jersey incorporated company into a foreign insolvency process is well-established. The previous authorities and principles based on necessity were summarised by William Bailhache, then Deputy Bailiff, in REO Powerstation Limited [2011] JRC 232A at paragraphs 5 to 16. At paragraph 18, the Court made the following comments in relation to the exercise of its discretion: "It seems to us that the Court should be

prepared to contemplate issuing a letter of request if it is in the interests of the creditors, or if it is in the interests of the debtor or if it is in the public interest. In relation to the latter of these three considerations, the public interest obviously includes, indeed we think as a matter of priority, a satisfactory methodology for dealing with the interests of the creditors and the debtor." 12. When considering what is in the best interests of creditors, it is now desirable for the Court to have a note identifying the differences between potential insolvency remedies available in Jersey and for the proposed other jurisdiction - see Re Regus Plc [2021] JRC 238 at paragraph 25. Examples of cases where the Court has considered applications for letters of request to the High Court of England and Wales for an administration order are Re HSBC Bank Plc re Tanbrook [2013] JRC 046 and Re Alard Investments Limited [2015] JRC 137 . In Metropolitan Life Insurance Company v Dalton Airfield Estate Limited [2012] JRC 192 , Clyde-Smith, Commissioner, granted an application to issue a letter of request to the Court of Session in Scotland requesting it to make an administration order in respect of the respondent Jersey company, Dalton Airfield Estate Limited. In that case, at paragraph 8, the Court set out the following questions that it should consider: "( i )Whether, if a letter of

request is issued, the Court of Session could properly consider an application for the appointment of administrators; (ii) Whether, if the Court of Session considers an application for the appointment of administrators, the Court of Session will make such an order; and (iii) Whether it is in the interests of creditors, Dalton and/or in the public interest for it an appointment of administrators be made?" An administration order in the Court of Session in Scotland 13. As Marketgait is insolvent, it is clearly necessary in the interests of creditors for an orderly insolvency process to be commenced so that its assets may best be realised. Whilst Marketgait has bank accounts in England and Wales (with Barclays) and in Jersey, as well as two Jersey situs receivables due from related parties, the Property in Dundee, Scotland, is by far the most significant asset of the Company. The Company's business operates through the Property and its trade creditors are primarily in Scotland.

14. The Court was provided with an opinion from Ms Elisabeth Roxburgh, a member of the Scottish Bar who is experienced in restructuring and insolvency matters, together with a note comparing the remedies available to office holders in insolvency proceedings in Jersey and in Scotland. The key parts of Ms Roxburgh's opinion were as follows: (i) Section 426 of the Insolvency Act 1986 applies in Scotland and, in summary, provides that "(4) The courts having jurisdiction in relation to insolvency law in any part of the United Kingdom shall assist the courts having the corresponding jurisdiction in any other part of the United Kingdom or any relevant country or territory". Sub-section 11 goes on to provide that a " relevant country or territory " means any of the Channel Islands or the Isle of Man. (ii) Before assistance is given by the Court of Session in Scotland, a request must be made by a Court in a relevant country or territory which must have jurisdiction in respect of insolvency law in its country or territory. There is no requirement that formal insolvency proceedings in the territory in question have been opened. It is sufficient that the requesting Court has jurisdiction in relation to insolvency matters, as the Royal Court does in respect of insolvency matters in Jersey. (iii) It would not be possible for Barclays to make an application for an administration order

directly to the Court of Session in Scotland as Marketgait is incorporated in Jersey and therefore, for Scottish law purposes, its Centre of Main Interest is not Scotland. However, the position is different where a requesting Court makes a request for assistance to the Scottish Court pursuant to Section 426 of the Insolvency Act 1986. The extent of any assistance granted by the Court of Session is an exercise of its discretion. (iv) The Court of Session could appoint an administrator pursuant to an application under Section 426 of the Insolvency Act 1986 if it was satisfied that the Company is insolvent, or if it is satisfied that the Company is or is likely to become unable to pay its debts, and that an administration order is reasonably likely to achieve the purpose of the administration. Reviewing the affidavit evidence provided to her, Ms Roxburgh considered that the failure of Marketgait to pay its debt to Barclays raised an inference that the Company is unable to pay its debts as they fall due and that there was nothing in that evidence to suggest that Marketgait would be in a position to challenge that inference. (v) The primary objective of administration in Scotland is to rescue the company as a going concern. The second, alternative objective is to achieve a better result for creditors as a whole than would be likely if the company were wound up (without first being

in administration). The third alternative objective is to realise property in order to make a distribution to one or more secured or preferential creditors. (vi) The affidavit of Mr Griffin, the licenced insolvency practitioner, provided cogent evidence that the purpose of the administration in this case is reasonably likely to be met. The main advantage would be the ability to continue to manage the Property which would both maximise income revenue from it and maximise the future sale price of the Property. (vii) The power to make an administration order is discretionary but the Court of Session will exercise its discretion to do so unless special circumstances exist for refusing the order sought. Based on the information which she has seen, Ms Roxburgh has not identified any factors which would suggest that the Court of Session would refuse to appoint an administrator to Marketgait . (viii) In Ms Roxburgh's experience, administrators appointed in Scotland are able to deal with assets situated in England without requiring any further orders from the English Court. If necessary, the Court of Session could issue a request to the Royal Court in Jersey for the recognition of administrators that it had appointed if that proved necessary to deal with Jersey situs assets. (ix) The powers of the Court of Session under Section 426 of the Insolvency Act 1986 are very wide. They enable

the Scottish Courts to distribute assets in Scotland in accordance with the provisions of the law of the requesting Court - i.e. in this case, Jersey. However, Ms Roxborough properly expressed no firm view as to how the Court of Session would exercise a discretion concerning whether to apply Jersey distribution rules when taking into account its own distribution rules, as this would be a matter for the Court of Session. Exercise of discretion in this case 15. The affidavit of Mr Griffin deposed to his belief that an administration order in Scotland would achieve a better result for Marketgait's creditors as a whole than would be likely if the Company were wound up. Analysing the financial position of the Company, he considered that the appointment of administrators would ensure that Marketgait could preserve its assets by trading and maintain its income stream with the objective of a controlled wind down. An administration order would provide a moratorium on the enforcement of claims against the Property and allow for a prolonged period of trading. The students occupying the Property could remain in situ and the rental income generated would offset the ongoing costs of maintaining the Property until it can be disposed of, together with meeting the costs and expenses of the administration itself. Further, the administrators would have power and discretion as to when to sell the Property on the basis of specialist advice. A sale of a tenanted property is anticipated to realise more value in the market than a vacant building.

16. Mr Griffin's affidavit also drew attention to the possibility of some distribution to unsecured creditors (which would include Jersey unsecured creditors) through an amount set aside from realisations from the net floating charge. This is pursuant to Section 176A of the Insolvency Act 1986 which provides for a " prescribed part " of the company's net assets to be made available for unsecured creditors, rather than to Barclays, as the floating charge holder. The Insolvency Act 1986 (Prescribed Part) Order 2003 provides the rules for the calculation of the prescribed part based on percentages of the available sums up to a present cap of £800,000.

17. In this case, there are no Jersey insolvency procedures available that would achieve a better outcome for creditors than an administration order in Scotland pursuant to the Insolvency Act 1986 for the following reasons: (i) As at the date of the hearing, there is currently no Jersey equivalent procedure to an order for administration which would allow the Company to continue to trade for a reasonably prolonged period, as is possible in this case. A remise de bien has not been used for corporate debtors and may not be appropriate for cross-border insolvencies. Further, it depends on the debtor being able to demonstrate that it is balance sheet solvent which Marketgait may be unable to demonstrate due to the substantial remediation costs arising from the cladding problem at the Property. (ii) A désastre or winding up would require the Company to cease trading. Whilst the Viscount or a liquidator appointed under the Companies (Jersey) Law 1991 (the "Companies Law") would have power to carry on the business of Marketgait as far as is necessary or expedient for its disposal, such powers may not permit trading for a reasonably prolonged period by contrast with the powers of an administrator under an administration order in Scotland. (iii) As regards a just and equitable winding up procedure under Article 155 of the Companies Law, Barclays as a creditor does not have standing to

apply under Article 155(2) of the Companies Law. (iv) Whilst the Companies Law had been amended to provide for the appointment of provisional liquidators on the application of the creditor, the procedure had not been used in a similar situation to that faced by the Company. Further, the Viscount's Department had observed that in a désastre or winding under the Companies Law the Viscount or a Court appointed liquidator, or a provisional liquidator, would all need to seek recognition in the Scottish Courts, and potentially in the English Courts, given that Marketgait also had English situs assets. They might also need to appoint local advisers and agents to deal with the assets which would all likely add to the time and cost of these alternative insolvency processes to the disadvantage of creditors as a whole. (v) None of the domestic Jersey procedures had the potential advantage to unsecured creditors pursuant to Section 176A of the Insolvency Act which allowed for a " prescribed part " of the Company's net assets to be made available for their benefit.

18. In summary, the Court concluded in the exercise of its discretion that issuance of a Letter of Request to the Court of Session for the purpose of an administration order was necessary in the best interests of creditors. The Act of Court 19. The Act of Court ordering issuance of the letter of request to the Court of Session also included orders that no action shall be taken or proceeded with against Marketgait except with the leave of the Court and subject to such terms as the Court may impose. This was to prevent parallel insolvency processes and was intended to mirror the statutory provisions at Article 159(4) of the Companies Law in the context of a creditor's winding up, and Article 10(1) of the Bankruptcy ( Désastre ) (Jersey) Law 1990 .

20. The Act of Court also included a prohibition on the transfer of shares or alterations in the status of the Company's members except by leave of the Court, but with a proviso that a secured party (i.e. in this case Barclays) may exercise its enforcement and appropriation rights under Part 7 of the Security Interests (Jersey) Law 2012 .

21. Further, any administrators who are appointed in due course by the Court of Session were required to publish notice of Marketgait being placed into administration and of their appointment in the Jersey Gazette and inviting creditors in Jersey to file any claims that they may have with the administrators. This was to ensure that the outcome of Barclays' application would be apparent to creditors, which was a concern of the learned Jurats. For the same reason Barclays was also required to deliver a copy of the Act of Court to the Jersey Registrar of Companies as soon as practicable for filing in the Register of Companies.

22. Finally, the Act of Court included provision for Barclays and the convened parties to reapply to the Court in these proceedings in the event that the Court of Session refused to make an administration order in respect of Marketgait , and that there should be liberty for Barclays to apply for its costs of and incidental to the Representation as costs of the administration. Authorities UK Insolvency Act 1986 REO Powerstation Limited [2011] JRC 232A. Re Regus Plc [2021] JRC 238 . Re HSBC Bank Plc re Tanbrook [2013] JRC 046 . Re Alard Investments Limited [2015] JRC 137 . Metropolitan Life Insurance Company v Dalton Airfield Estate Limited [2012] JRC 192 . Companies (Jersey) Law 1991. Bankruptcy ( Désastre ) (Jersey) Law 1990 Security Interests (Jersey) Law 2012 Page Last Updated: 24 Apr 2026 BAILII: Copyright Policy | Disclaimers | Privacy Policy | Feedback | Donate to BAILII