Despite his bankruptcy, K lived in a flat in South Kensington and drove luxury cars. He was not fully forthcoming with details as to how his lifestyle was funded. Further, he did not provide full details as to a family trust, shareholdings and bank accounts. Penelope Reed QC (sitting as a deputy judge of the High Court) suspended K’s discharge on the application of the trustee in bankruptcy. Whilst the mere fact of K’s lifestyle could not found an application, because the court had to act on the basis of evidence, not suspicion, there was sufficient evidence from K’s unsatisfactory answers for the court to conclude that the threshold requirement that K had failed, or was failing, to comply with his obligations under the Insolvency Act 1986 were not being complied with. Since K had been more compliant since the application to suspend was issued, a period of suspension until May 2014 would encourage further compliance.
As a matter of construing the R3 Standard Conditions for Individual Voluntary Arrangements, the costs of existing proceedings against a debtor as at the date of the creditors' meeting fell to be treated as a debt provable within the IVA. The deputy judge also passed some observations as to the possibility that the Glenister v Rowe line of authorities as regards costs orders not being a contingent debt being overruled or recast by the Supreme Court in the Nortel litigation.
P and G were co-owners of a leasehold property. A bankruptcy order was made against G, and his trustee in bankruptcy negotiated for the sale of G's interest in the property to P. A second bankruptcy order was made against G and M was appointed as his trustee in bankruptcy. M asserted that G might still have had an interest in the property pursuant to the previous dealings with the first trustee, and so registered a restriction against it. The adjudicator cancelled the restriction, on the basis that, construing the previous transaction, G had no such interest that could be protected. Mann J dismissed M's appeal. Construing the correspondence, neither G nor the first trustee had retained any interest as a constructive trust of the beneficial interest had been created in P's favour.
At a time when B was made bankrupt, he had interests in various overseas companies. Post-bankruptcy, B sought to back-date a transfer of some shares to an associate. On that basis, the registrar acceded to the trustee in bankruptcy's application to suspend discharge, even though more recently B had been more co-operative. Discharge was suspended until the trustee confirmed that full co-operation had been given. Rose J dismissed B's appeal. The registrar had reached the right decision and B's remedy to revoke the suspension was to co-operate.
After his property empire collapsed, K moved to Florida. K was made bankrupt on his own petition, and trustees in bankruptcy were appointed. A bank commenced proceedings in New York in respect of loans to K and also issued proceedings there to avoid allegedly fraudulent transfers of K's Florida property. K sought anti-suit injunctions in respect of those two sets of proceedings, asserting that the bank had brought them to obtain an unfair advantage over his other creditors. Roth J dismissed the application. The bank had given an undertaking to make available any proceeds of the litigation to the trustees. Further, since it was arguable that K's centre of main interests was in the US, it would be unfair to prevent the US courts determining the issues in those proceedings.