The Facts

The liquidator of a company refused to requisition a meeting of creditors on the basis that it was being called by the potential defendants to actions arising out of his investigations with the purpose of removing him and stymying any claims. The liquidator applied to Court for a direction not to summon the meeting.

The Decision

  • The Court has jurisdiction to override the provisions of the relevant insolvency rules and intervene and, in principle, restrain the calling of a meeting
  • The burden of proof is on the liquidator to establish that the direction sought is required for the just and beneficial winding up of the company
  • On the facts, there was no or insufficient evidence that there were any claims to be stymied by removal from office, as there was no proof of tangible claims or even funding in respect of the same.

Comment

This case is useful confirmation for liquidators that, subject to providing sufficient proof, they can defy the will of creditors in a voluntary liquidation where it would not be beneficial to the liquidation. That, however, will always be a matter of evidence.

Kean v Lucas [2017] EWHC 250 (Ch)