Key Point

Her Majesty's Revenue & Customs ("HMRC") were not immune from the requirement to give an undertaking for damages suffered where a provisional liquidator was appointed based on HMRC allegations of fraud and tax evasion.

The Facts

A provisional liquidator (the "Provisional Liquidator") was appointed to Abbey Forwarding Limited (the "Company") on the basis of allegations of fraudulent tax evasion and an undertaking in damages given by HMRC. Proceedings against the directors of the Company for misfeasance, based on evidence provided by HMRC, were dismissed and HMRC later withdrew the allegations of fraudulent tax evasion.  The subsequently appointed liquidator of the Company (the "Liquidator") applied for an inquiry as to damages on the undertaking given by HMRC on the appointment of the Provisional Liquidator.

The Decision

  • The undertaking did not automatically terminate on the making of the winding-up order and the appointment of the Liquidator; and
  • The court therefore had jurisdiction to enforce the undertaking by ordering an inquiry as to damages.


The case is useful confirmation that an undertaking given by HMRC, a public body, is not beyond the jurisdiction of the Court.

> Abbey Forwarding Limited (in Liquidation) v Her Majesty's Revenue & Customs