Auteur

Stephen O'Grady

Associé

Londres

Auteur

Stephen O'Grady

Associé

Londres

5 mai 2021

Disputes Quick Read – 24 de 62 Publications

Disputes Quick Read: One Blackfriars administrators cleared of misfeasance

Quick read

On 23 March 2021, the 2011 sale of the One Blackfriars development site in London by administrators was cleared of misfeasance by the High Court, in Re One Blackfriars Ltd [2021] EWHC 684 (Ch).

In a £250 million claim, the company's liquidators had alleged that the former administrators had breached their duties by failing to act independently of the banking syndicate which appointed them, failing to properly assess the value of the site, and selling the site at an undervalue.

Here, we recap the facts of the case and outline the key takeaways to consider.

Case overview

The administration had been agreed as a "light touch administration", a term which meant something different then to what it does now (where administrators authorise directors to continue to exercise management powers). As an Objective 3 administration (to make a distribution to secured or preferential creditors), the administrators were entitled to put the interests of a secured creditor above the interests of other creditors, subject to a duty to avoid unnecessary harm.

The liquidators alleged the administrators effectively surrendered their discretion and control to the banking syndicate. However, the High Court accepted that the administrators acted properly and independently, and the reference to "light touch" related only to the level of day to day management (and therefore fees) expected.

In dismissing all the liquidators' wide-ranging allegations, the High Court also found that:

the administrators properly marketed the development site
they were entitled to instruct and rely on the advice of CBRE and DP9 as agents and planning consultants, and
it was reasonable for them to not pursue a revised planning application, and to rely on proper marketing rather than obtaining a further valuation.

Key takeaways

The court followed the principles laid down in Davey v Money in holding that:

the administrators' duty to obtain the best reasonably obtainable price is not absolute – it is only to take reasonable care to do so
the administrators' duty upon sale was not "non-delegable" (in contrast to mortgagees) in that administrators can reasonably rely on advice from agents which appeared to be competent
in selecting the statutory objective to follow, the standard of review is good faith and rationality.

It's also worth noting that the five-week trial was conducted fully remotely, as a result of the COVID-19 pandemic. This followed the judge's refusal of the liquidators' application in April 2020 (at the outset of the pandemic) for the trial listed for June 2020 to be adjourned (which we previously covered here).

The court remarked on the success of the remote trial, and some of its clear advantages – for example, the trial bundle was displayed on screen to everyone attending the hearing. The judge was able to see witnesses clearer than possible in a physical court room, and did not consider the inability to view witnesses' full body language or demeanour as a significant disadvantage.

The trial was made available to the public by livestream, and was watched by 60 people a day on average, with a peak of 428 viewers. It will be interesting to see the extent to which the developments (and many advantages) in remote trials and hearings are retained and adapted once there is a physical return to court rooms.

Find out more

To discuss the issues raised in this article in more detail, please reach out to a member of our Restructuring & Insolvency or Disputes & Investigations teams.

Services et Groupes Résolution des litiges Restructuration et insolvabilité

Dans cette série

Résolution des litiges

Disputes Quick Read: A new approach to giving evidence? WhatsApp with that?

3 October 2022

par Gemma Broughall

Résolution des litiges

Disputes Quick Read: Ethereum Merge - what legal issues arise?

22 September 2022

par Ben Jones, Emma Allen

Cryptoactifs, blockchain et technologie des registres distribués (DLT) et projets Web 3.0

Disputes Quick Read: New obligations on cryptobusinesses to report under the UK sanctions regime

9 August 2022

par Nick Maday, Katie Fry-Paul

Résolution des litiges

Disputes Quick Read: Disclosure - What information can be redacted?

25 July 2022

par Lizzie Hancock

Résolution des litiges

Disputes Quick Read: what claims exist when a smart contract is breached?

6 July 2022

par Emma Allen

Résolution des litiges

Disputes Quick Read: New gateway for serving Norwich Pharmacal Orders and Bankers Trust orders out of the jurisdiction

Welcome news for those pursuing fraud claims in the English Courts

28 July 2022

par Emma Allen, Samantha Brendish

Résolution des litiges

Disputes Quick Read: Disclosure Pilot Scheme – here to stay

21 July 2022

Résolution des litiges

Disputes Quick Read: Defining the duty - the limits of the responsibility assumed by professionals

27 July 2022

par Stuart Broom

Résolution des litiges

Disputes Quick Read: Climate change litigation – successful challenge to government's Net Zero Strategy

29 July 2022

par Jessica Thomas, Lucy Waddicor

Résolution des litiges

Disputes Quick Read: Judicial Review and Courts Act 2022 – now in force

17 June 2022

par Stephanie High

Résolution des litiges

Disputes Quick Read: an important reminder of the duty to disclose electronic documents in native format

13 June 2022

par Lizzie Hancock

Résolution des litiges

Disputes Quick Read: ENRC prevails in claim against former solicitor

26 May 2022

par Emma Allen, David de Ferrars

Résolution des litiges

Disputes Quick Read: Climate change litigation update – McGaughey v Universities Superannuation Scheme Limited

31 May 2022

par plusieurs auteurs

Résolution des litiges

Don't lose your keys: Bitcoin developers do not have a duty to assist owners in recovering lost cryptocurrency

4 April 2022

par Emma Allen, Samantha Brendish

Résolution des litiges

Disputes Quick Read: The new witness statement preparation rules – a year on

5 April 2022

par Stephanie High, Laura Singleton

Résolution des litiges

Disputes Quick Read: ClientEarth v Shell – climate change litigation shifts focus to UK companies

31 March 2022

par plusieurs auteurs

Résolution des litiges

Disputes Quick Read: High Court rules that failure to provide adequate data security is not a positive act

21 September 2021

par Michael Yates, Matthew Caskie

Résolution des litiges

Disputes Quick Read: Key changes to the Disclosure Pilot Scheme

13 September 2021

Résolution des litiges

Disputes Quick Read: Judicial Review and Courts Bill – unpacking the UK government's proposed amendments

6 September 2021

par Stephanie High

Résolution des litiges

Disputes Quick Read: Will litigants be compelled to participate in alternative dispute resolution?

2 August 2021

par David de Ferrars, Stephanie High

Résolution des litiges

Disputes Quick Read: Freezing injunctions – maximum custodial sentence imposed for breach

21 July 2021

par Nick Storrs, Georgina Jones

Résolution des litiges

Disputes Quick Read: The online future of civil justice – the end of the legal profession or the end of legal drudgery?

15 July 2021

par Jessica Thomas

Résolution des litiges

Disputes Quick Read: Will the courts change forever post-COVID?

26 May 2021

par David de Ferrars

Résolution des litiges