Court clarifies extra-territorial effect of section 236—Official Receiver v Norriss

Court clarifies extra-territorial effect of section 236—Official Receiver v Norriss

Is Re MF Global still good law for the proposition that section 236 of the Insolvency Act 1986 (IA 1986) does not have extra-territorial effect? Marc Brown, a barrister at St Philips Chambers, considers the judgment in the recent case of Official Receiver v Norriss and what it means for practitioners.

Original news

Official Receiver v Norriss; subnom Re Omni Trustees Ltd [2015] EWHC 2697 (Ch), [2015] All ER (D) 69 (Nov)

The Chancery Division allowed the official receiver's (OR's) application, under IA 1986, s 236, for an order that the respondent, a Hong Kong resident, was to produce a witness statement, with supporting documents. IA 1986, s 236(3) had extra-territorial effect and, provided the considerations identified in previous authority were satisfied, the court had jurisdiction to require a person resident outside the jurisdiction to submit to the court an account of his dealings with a company, or to produce any books, papers or other records in his possession or under his control relating to the company.

Briefly, what was the background to the application?

This was the hearing of an application by the OR in his capacity as the liquidator of Omni Trustees Ltd (the company) for an order under IA 1986, s 236 that Mr Tristram Michael Norriss produce a witness statement detailing and exhibiting various matters concerning dealings with the company.

What were the legal issues that the judge had to decide in this application?

This case concerned the extra-territorial effect of IA 1986, s 236, particularly in light of the decision of the High Court (David Richards J, as he then was) in Re MF Global (UK) Ltd [2015] EWHC 2319 (Ch), [2015] All ER (D) 22 (Aug). The correctness of that decision was challenged in this case.

For further reading on Re MF Global, see blog post: Territoriality following MF Global.

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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.