Accountant Of Court v Halifax Plc [1999] ScotCS 131 (28 May 1999)

Accountant Of Court v Halifax Plc [1999] ScotCS 131 (28 May 1999)

Bankrupt borrowing members are not disqualified from benefit under the Transfer Agreement except where the Society has taken possession of security subjects. Their rights to free shares arose on vesting day and vested in the permanent trustee as acquirenda under section 32(6) of the Bankruptcy Act 1985. The Society and Halifax, having notice of sequestration, have no defence under the proviso to section 32(6).

Citation
[1999] ScotCS 131
Parties
Pursuer: The Accountant of Court; Defender: Halifax Plc
Jurisdiction
Scotland
Judgment Date
28 May 1999
Procedural Posture
Civil / Interlocutory Judgment on Relevancy and Pleadings
Outcome
Defenders' fourth plea in law repelled; Accountant allowed proof before answer of averments; quantum of damages to be determined.
Legal Topics
Transfer of Business, Distribution of Shares, Bankrupt Estate Rights, Trustee Entitlement
Bankruptcy Company Law Transfer of Business Distribution of Shares Bankrupt Estate Rights Trustee Entitlement

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Parties

The Accountant of Court

Pursuer

Halifax Plc

Defender

Procedural Posture

Civil / Interlocutory Judgment on Relevancy and Pleadings

Legal Issues

  1. 1 Whether bankrupt borrowing members acquired rights to free shares on vesting day
  2. 2 Whether such rights constituted property or income under the Bankruptcy Act 1985
  3. 3 Whether Halifax is protected by the proviso to section 32(6) of the Bankruptcy Act 1985

Ratio Decidendi

Bankrupt borrowing members are not disqualified from benefit under the Transfer Agreement except where the Society has taken possession of security subjects. Their rights to free shares arose on vesting day and vested in the permanent trustee as acquirenda under section 32(6) of the Bankruptcy Act 1985. The Society and Halifax, having notice of sequestration, have no defence under the proviso to section 32(6).

Court Disposition

Defenders' fourth plea in law repelled; Accountant allowed proof before answer of averments; quantum of damages to be determined.

Orders

  • Sustain pursuer's second and fifth pleas in law to the extent of repelling defenders' fourth plea in law.
  • Repel defenders' second and fifth pleas in law by amendment or consent.