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In Maud v Libyan Investment Authority, the Chancery Division had todecide whether a statutory demand should be set aside in circumstances where the debtor claimed he was unable tomake any payment as todo so would be illegal.
Maud v Libyan Investment Authority  EWHC 1625 (Ch),  All ER (D) 101 (Jun)
The applicant debtor sought an order setting aside a statutory demand served on him by the respondent creditor, claiming that any payment made by him tothe respondent would be in breach of a sanctions regime imposed by the UN that prohibited people in certain circumstances from dealing with certain Libyan individuals and entities, including the respondent.
The Chancery Division (Mrs Justice Rose) granted the application and set aside the statutory demand. Having considered the sanctions regime by reference tothe international, EU and UK law enacted togive it effect, the judge held that any payment made by the applicant tothe respondent would be in breach of the sanctions regime and that it would be unjust in those circumstances toallow a creditor topresent a bankruptcy petition when the payment of the debt would expose the debtor tocriminal penalties. It did not matter whether or not the applicant was able topay the debt.
The debtor (Mr Maud) entered into a guarantee in April 2008 with the Libyan Investment Authority (LIA) in support of the indebtedness of his company, Propinvest Group Ltd (Propinvest), tothe LIA. Propinvest defaulted in March 2010 and in February 2014 the LIA served a statutory demand on Mr Maud in the sum of about £17.5m. The LIA then presented a bankruptcy petition against Mr Maud, and he applied toset aside the statutory demand.
Mr Maud did not dispute that he entered into the guarantee, or that he was liable topay
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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.
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