Rely on the most comprehensive, up-to-date legal content designed and curated by lawyers for lawyers
Work faster and smarter to improve your drafting productivity without increasing risk
Accelerate the creation and use of high quality and trusted legal documents and forms
Streamline how you manage your legal business with proven tools and processes
Manage risk and compliance in your organisation to reduce your risk profile
Stay up to date and informed with insights from our trusted experts, news and information sources
Access the best content in the industry, effortlessly — confident that your news is trustworthy and up to date.
With over 30 practice areas, we have all bases covered. Find out how we can help
Our trusted tax intelligence solutions, highly-regarded exam training and education materials help guide and tutor Tax professionals
Regulatory, business information and analytics solutions that help professionals make better decisions
A leading provider of software platforms for professional services firms
In-depth analysis, commentary and practical information to help you protect your business
LexisNexis Blogs shed light on topics affecting the legal profession and the issues you're facing
Legal professionals trust us to help navigate change. Find out how we help ensure they exceed expectations
Lex Chat is a LexisNexis current affairs podcast sharing insights on topics for the legal profession
Printer Friendly Version
David Mohyuddin QC, barrister at Exchange Chambers, examines Secretary of State for Business, Innovation and Skills v PLT Anti-Marketing Ltd and explains the legal issues raised, and the practical implications and lessons that can be learned from the judgment.
Secretary of State for Business, Innovation and Skills v PLT Anti-Marketing Ltd  EWHC 3981 (Ch),  All ER (D) 260 (Dec)
The Chancery Division held that it had jurisdiction to grant a compulsory winding-up order in respect of a company on the company’s own application, and where there was an extant winding-up petition, which had previously been presented by the Secretary of State for Business, Innovation and Skills (SoS). The company was no longer trading and, notwithstanding that the SoS’s petition had been presented on public interest grounds, it had sought the winding-up of the company on the just and equitable ground, which was sufficient to found jurisdiction in the court to make a winding-up order on the company’s application. There was no requirement that the case be ‘thoroughly exceptional’ where, as in the present case, there was an extant winding-up petition.
PLT carried on business selling the purported service of preventing unwanted telephone sales calls and junk mail. It mainly recruited its customers by cold calling, during which customers were required to make an immediate decision whether to purchase PLT’s service.
By the petition as amended, the SoS sought the compulsory winding-up of PLT because:
Notably, the SoS did not rely on PLT’s insolvency as a ground for making a compulsory winding-up order.
PLT avoided the appointment of the official receiver as provisional liquidator by giving undertakings as to its trading, so as to require it, in advance of making sales, specifically to advise customers that it would register their details with the telephone and mail preference services, and that such services were free services otherwise available to customers individually.
PLT applied to vary those undertakings on the basis of a proposed manner of trading. This application was dismissed. PLT appealed. Its appeal was allowed in part because the Court of Appeal considered that the question over the way in which PLT proposed to trade (upon which its application to vary the undertakings was premised) should have been considered after trial, but that the judge was correct not to have varied the undertakings.
There was then substantial procedural delay, not least because criminal proceedings were brought against PLT’s directors.
PLT then applied for an order that it be wound-up on the basis that it was irretrievably insolvent and for the SoS’s petition (which did not include insolvency as a ground for winding-up) to be amended if need be. The SoS had made no application of his own for such amendment.
The judge had to decide whether:
On behalf of PLT it was argued that:
On behalf of the SoS it was argued that:
The judge decided that:
The judge considered that publication of the judgment would be sufficient vindication of the SoS’s eagerness to enforce the public interest, which he could no longer do by reason of circumstances outside his control.
Accordingly, the judge made a compulsory winding-up order against PLT and ordered it to pay the SoS’s costs of the petition. The judge ordered that those costs were to include the cost of obtaining a transcript of his judgment so that the SoS could demonstrate the assiduity with which he had pursued what he considered to be the public interest.
It is doubtful that this judgment has clarified the law in this area. The facts of this case are entirely unusual and what appears to have played heavily on the judge’s mind was the delay that had already been incurred and the likely delay before any trial of the SoS’s petition could be heard in circumstances where PLT had ceased trading.
The competing parties in public interest winding-up petitions are, generally, the SoS as petitioner and the company as respondent. The SoS has specialist advisers who are well-versed in this area of law. As for those advising respondent companies, it would be wrong to think this decision gives companies—and those behind them—a get out of jail card where the company can demonstrate its own insolvency. Rather, what appears to have driven the judge’s conclusion to exercise the jurisdiction he said the court enjoyed was the time already taken to reach this stage and the time that would elapse before any trial.
Interviewed by Susan Ghaiwal.
The views expressed by our Legal Analysis interviewees are not necessarily those of the proprietor.
If you are a LexisPSL subscriber, click the links below for further information:
When a winding-up petition can be issued and a company wound up by the court
The appointment of a provisional liquidator
Not a subscriber? Find out more about how LexisPSL can help you and click here for a free trial of LexisPSL Restructuring and Insolvency.
First published on LexisPSL Restructuring and Insolvency
0330 161 1234