Thursday 13 May 2021

UK: England and Wales: winding-up in the public interest

Judgment was delivered yesterday in Secretary of State for Business Energy And Industrial Strategy v Celtic Consultancy & Enterprises Ltd & Ors [2021] EWHC 1240 (Ch). The decision is noteworthy because of the trial judge's discussion of the circumstances in which winding-up on public interest grounds might be justified in respect of a company's inability to explain the basis on which it has received money.  The trial judge (HHJ Cawson QC) stated (paras. [128] and [129]): 
.... [it is argued that] a failure simply to explain the basis upon which monies are received cannot properly form the subject matter of a winding up petition presented on public interest grounds. There is force in this point, and in the main I consider that this must be right, but I do not consider that one can exclude there being circumstances in which a failure to explain might, in itself in the particular circumstances of the case, be indicative of the relevant company operating in an illegal or otherwise inherently objectionable way, or should be taken to be so indicative, such that the Court is entitled to proceed on the basis that the affairs of the Company have been, or are being, conducted in an inherently objectionable way so as to disclose a lack of probity."

Update (19 May 2021) - the ICLR has published a summary of the decision: see here.

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