Validity of Out-of-Hours Administration Appointments (Re Statebourne (Cryogenic) Ltd)

Validity of Out-of-Hours Administration Appointments (Re Statebourne (Cryogenic) Ltd)

This analysis considers the recent decision in Re Statebourne (Cryogenic) Ltd, in which Zacaroli J was required to determine the validity of an out-of-court appointment of administrators by the directors of a company, and the time at which the appointment took effect, where the notice of appointment was CE-filed. Written by Simon Passfield, barrister, at Guildhall Chambers.

Re Statebourne (Cryogenic) Ltd [2020] EWHC 231 (Ch), [2020] All ER (D) 42 (Feb)

What are the practical implications of this case?

This is now the seventh reported case in the last 12 months concerning the validity of an out-of-court appointment of administrators where the notice of appointment (NOA) has been CE-filed. It is the first reported decision since the guidance note on this topic which was published in January 2020 by the Chancellor of the High Court.

In this case, as in the recent case of Carter Moore Solicitors Limited [2020] EWHC 186 (Ch), [2020] All ER (D) 61 (Feb) (decided three days earlier), it was unnecessary for the court to determine whether or not a company and its directors may CE-file an NOA when the court office is closed (a question on which there are conflicting authorities) because it took a pragmatic approach that enabled it to conclude that the NOA was validly filed before the court office closed. Accordingly, that thorny issue remains live (although it is anticipated that it will shortly be resolved by way of amendment to the Insolvency (England and Wales) Rules 2016 (IR 2016), SI 2016/1024).

This case does address the question of how to calculate the period of ten business days beginning with the date on which the notice of intention to appoint (NOIA) is filed referred to in paragraph 28(2) of Schedule B1 to the Insolvency Act 1986 (IA 1986) (ie the period within which an appointment must be made). In Re Keyworker Homes (North West) Ltd [2019] EWHC 3499

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About the author:

Zahra started working as a paralegal at Lexis Nexis in Banking and Insolvency teams in April 2019. Zahra graduated with a 2.1 honours in a BA French and Spanish, completed the GDL at BPP University and is seeking some experience before commencing the LPC. She has undertaken voluntary work for law firms in London, Argentina and Colombia.