Anderson v. Dickens [2008] ScotCS CSOH_134 (10 September 2008)

Anderson v. Dickens [2008] ScotCS CSOH_134 (10 September 2008)

The transfer of £270,750 to the defender was an unfair preference under section 243 of the Insolvency Act 1986 because the defender had given personal guarantees to the investors, making him a creditor who was preferred to the prejudice of the general body of creditors. The payment was not in the ordinary course of business, not for a debt due and payable to the defender, and not a reciprocal obligation. The action was properly directed against the defender as the benefited creditor. The discount of £10,000 to Mr Dempster was also a preference in favour of the defender as it reduced his liability as guarantor.

Citation
[2008] ScotCS CSOH_134
Parties
Pursuer: Keith Veitch Anderson; Defender: Paul Anthony Dickens
Jurisdiction
Scotland
Judgment Date
10 September 2008
Procedural Posture
Civil (insolvency/company Law) / Summary Decree/decree De Plano Application
Outcome
Summary decree granted for the pursuer (liquidator) against the defender for repayment of £270,750 as an unfair preference; decree de plano for the £10,000 discount claim refused (requires proof).
Legal Topics
Unfair Preference, Liquidator's Powers, Personal Guarantee, Restitution, Section 243 Insolvency Act 1986, Challenge of Transactions, Creditor Preference
Insolvency Law Company Law Commercial Law Unfair Preference Liquidator's Powers Personal Guarantee Restitution Section 243 Insolvency Act 1986 +2 more

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Parties

Keith Veitch Anderson

Pursuer

Paul Anthony Dickens

Defender

Procedural Posture

Civil (insolvency/company Law) / Summary Decree/decree De Plano Application

Legal Issues

  1. 1 Whether the transfer of £270,750 to the defender constituted an unfair preference under section 243 of the Insolvency Act 1986.
  2. 2 Whether the discount of £10,000 to Mr Dempster was an unfair preference.
  3. 3 Whether the defender gave personal guarantees to investors and was thus a creditor benefited by the transactions.

Ratio Decidendi

The transfer of £270,750 to the defender was an unfair preference under section 243 of the Insolvency Act 1986 because the defender had given personal guarantees to the investors, making him a creditor who was preferred to the prejudice of the general body of creditors. The payment was not in the ordinary course of business, not for a debt due and payable to the defender, and not a reciprocal obligation. The action was properly directed against the defender as the benefited creditor. The discount of £10,000 to Mr Dempster was also a preference in favour of the defender as it reduced his liability as guarantor.

Court Disposition

Summary decree granted for the pursuer (liquidator) against the defender for repayment of £270,750 as an unfair preference; decree de plano for the £10,000 discount claim refused (requires proof).

Orders

  • Defender to repay £270,750 to the liquidator of New Alba (Redwood House) Limited.
  • No summary decree for the £10,000 discount; issue to proceed to proof.