What applies—the Insolvency (England and Wales) Rules 2016 or the CPR? (Wolf Rock (Cornwall) v Langhelle)

What applies—the Insolvency (England and Wales) Rules 2016 or the CPR? (Wolf Rock (Cornwall) v Langhelle)

The case involved an appeal from a decision of the county court following the compulsory winding up of the appellant company, which had contended that the debt was disputed on substantial grounds. The appellant argued that the judge below had erred in failing to admit further evidence filed before the final hearing which, it said, was filed in accordance with rule 7.16 of the Insolvency (England and Wales) Rules 2016, SI 2016/1024 (IR 2016), (albeit outside the time set by previous court orders), making a winding-up order for an unliquidated sum, and making incorrect factual and evaluative findings. The judge dismissed the appeal and in doing so gave helpful guidance on: (1) the interaction between IR 2016, r 7.16 (which sets a time for filing evidence) and the court’s case management powers (in controlling evidence); (2) the ‘implied sanction’ doctrine; (3) the meaning of ‘creditor’ and the jurisdiction to make a winding-up order where the sum is ‘uncertain’, ’unliquidated’ or concerns damages; and (4) the parameters of an appellate court’s interference with (a) relief from sanctions decisions and (b) evidential/evaluative findings. Written by Arnold Ayoo, barrister at 23ES and counsel to the respondent.

 

What are the practical implications of this case?

The case is of both procedural and substantive importance. It will help practitioners navigate practical issues relating to the control of evidence in winding-up proceedings and substantively, in deciding whether a claim is suitable for the winding up process:

Procedural (insolvency)—IR 2016, SI 2016/1024, r 7.16

There is little reported authority on the interpretation of IR 2016, SI 2016/1024, r 7.16. The judgment fills that void and helpfully states that IR 2016, SI 2016/1024, r 7.16 applies only to the first hearing of a petition, after which the court can control the filing of evidence. Practically, the judgment prevents a party submitting evidence outside of the court timetable by attempting to rely on the five business day time limit set out in IR 2016, 

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