Centre of main interests and rebutting the registered office presumption (Re Melars Group)

Centre of main interests and rebutting the registered office presumption (Re Melars Group)

On the hearing of a winding up petition, the court held that the presumption that a company’s centre of main interests (COMI) was in the place of its registered office did not operate as a default. Even where it was difficult to ascertain the actual place of administration of the company’s interests, the court was obliged to conduct that inquiry.

Having determined that no relevant administration was undertaken in the place of the registered office, the court turned to establishing the physical location that represented the centre of its administration albeit that it was said to ‘trade in the ether’. While leaving open the question of whether, under the preamble to the Recast Regulation on Insolvency, the company could be ordered to submit additional evidence to support its assertion as to its COMI (in this case, the company made no positive case), the court was prepared to draw adverse inferences in favour of the petitioner from the company’s silence.

Written by Edward Knight, barrister at XXIV Old Buildings.

Re Melars Group Ltd [2020] EWHC 2090 (Ch), [2020] All ER (D) 18 (Aug)

What are the practical implications of this case?

The judgment demonstrates that the court will be astute to preventing a debtor from taking advantage of an evidential presumption by silence or obscurity and will ensure that a move of registered office reflects a real move of its interests.

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About the author:

Stephen qualified as a solicitor in 2005 and joined the Restructuring and Insolvency team at Lexis®PSL in September 2014 from Shoosmiths LLP, where he was a senior associate in the restructuring and insolvency team.

Primarily focused on contentious and advisory corporate and personal insolvency work, Stephen’s experience includes acting for office-holders on a wide range of issues, including appointments, investigations and the recovery and realisation of assets (including antecedent transaction claims), and for creditors in respect of the impact on them of the insolvency of debtors and counterparties.