Monday, 14 January 2019

UK: England and Wales: section 423 of the Insolvency Act 1986

Judgment was given last Friday in Deansgate 123 LLP v Workman & Anor [2019] EWHC 2 (Ch). The decision is of interest because of the discussion it contains about the extent to which the bringing of a claim under section 423 ("Transactions defrauding creditors") of the Insolvency Act 1986 would amount to an abuse of process. It is interesting, too, because of what the trial judge, HHJ Eyre QC, said about section 423: it "provides the the court with a discretion to set aside transactions in certain circumstances but it is not to be seen as some form of punishment of wrongdoers – if only because the recipient of a transfer which is ultimately set aside may be entirely innocent of any wrongdoing" (para. [57]).

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