 |
[Home] [Databases] [World Law] [Multidatabase Search] [Help] [Feedback] | |
Jersey Unreported Judgments |
||
|
You are here: BAILII >> Databases >> Jersey Unreported Judgments >> In the matter of the Desastre of Dr Gail Cochrane [2024] JRC 043 (23 February 2024) URL: http://www.bailii.org/je/cases/UR/2024/2024_043.html Cite as: [2024] JRC 43, [2024] JRC 043 |
||
[New search] [Help]
|
Before : |
M. J. Thompson Esq., Commissioner, sitting alone |
IN THE MATTER OF THE DÉSASTRE OF DR GAIL COCHRANE
AND IN THE MATTER OF THE DÉSASTRE OF ORB A.R.L.
AND IN THE MATTER OF ARTICLE 7 OF THE BANKRUPTCY (DÉSASTRE) (JERSEY) LAW 1990
Advocate J. D. Garrood for the Representor.
Advocate O. J. Passmore for the Viscount.
judgment
the COMMISSIONER:
1. This judgment contains my written reasons for convening the Viscount as a Respondent to an application by Dr Gail Cochrane ("the Representor") seeking a recall of the orders for désastre made in respect of the estates of the Representor and Orb A.R.L. ("Orb") pursuant to Article 7(1) of the Bankruptcy (Désastre) (Jersey) Law 1990 ("the Désastre Law").
2. The declarations of désastre against the Representor and Orb were made on 24 November 2016. The Court set out its reasons for doing so in a judgment reported at Harbour v Orb [2017] JRC 007, which in turn referred to an earlier judgment, Representation of Harbour II LP [2016] JRC 171, for the background. It is not necessary for the purposes of this judgment to set out the background leading to the désastre orders being made, save to note that the background is complex. This is confirmed by subsequent judgments of the Royal Court dealing with applications for the Royal Court to issue letters of request Rep of Viscount re Cochrane and Orb ARL [2017] JRC 025 and to authorise the Viscount entering into settlement arrangements Viscount v Smith re: Cochrane and ORB A.R.L [2020] JRC 043. In the latter case, the Court noted the background of this matter as being "overwhelmingly complex" (see paragraph 2).
3. The short issue I had to determine concerned whether or not the Viscount was a proper party to the application beyond performing what Advocate Garrood described in his further submissions as "the administrative tasks of providing an up to date list of creditors".
4. Advocate Garrood's position for the Representor arose by reference to Article 7 of the Désastre Law which provides as follows:
5. By reference to In Blue Horizon Holidays [1994] JRC 031, Advocate Garrood contended that the test as to whether or not the Royal Court would recall any declaration of désastre was a simple arithmetic test. This was described in Blue Horizon as follows:
6. This decision, as well as a number of other applications brought by Blue Horizon Holidays Limited and its director, Mr Eves, was appealed to Court of Appeal in 1997 (see In re Blue Horizon Holidays [1997] JLR 124). I note on the appeal, the Viscount appeared in person at page 130, line 27. The Court of Appeal noted:
7. There does not appear to be any suggestion in the Court of Appeal judgment that the Viscount was not a proper party to be before the Court.
8. Mr Garrood however contended that the views of the Viscount were irrelevant to the exercise of the Court's discretion under Article 7 because Article 7(4) only required the Court to have regard to the interests of creditors and the debtor. He also expressed concern that the Viscount might be acting unlawfully or prejudicially to the interests of the Representor by incurring unnecessary costs in the désastre process.
9. I was not however persuaded by this submission. Firstly, Article 7(2) requires the debtor to give the Viscount not less than forty-eight hours' notice of the debtor's intention to make an application to recall a declaration of désastre. There must be some purpose to this notification. It clearly envisages the Viscount playing some role in relation to an application to recall a désastre; otherwise there would be no point in giving the Viscount notice of such an application.
10. Secondly, while directing that the Court shall have regard to the interests of creditors who file a statement of claim or who will be doing so and to the interests of the debtor, Article 7(4) does not preclude the Court from also having regard to the views of the Viscount. Article 7(4) simply states that the Court should have regard to the interests of creditors. It does not preclude the Court from hearing from the Viscount.
11. Thirdly, the position advanced by Advocate Garrood would be a surprising outcome. The Viscount on any application for a recall is likely to have significant information about whom the Viscount considers to be creditors or who might be filing a claim in the désastre. The Viscount might also have views based on information received during the désastre about the value of claims filed by creditors. Such information is highly likely to be of assistance to the Court in the Court determining the arithmetical exercise referred to by Advocate Garrood.
12. What Advocate Garrood's position fails to take into account is that before performing any arithmetical test, the Court will have to determine who are creditors and the value of their claims. The Court also has to determine the value of the property held by the Viscount. The Viscount may well be in possession of significant information to assist the Court to resolve these questions.
13. This is certainly the case in the present application where the désastre is complex and where the Viscount has been involved for a number of years in relation to the operation of the désastre.
14. My decision does not however mean that the role of a Viscount is without limits. Ultimately, if a debtor, seeking a recall of a declaration of désastre, disputes that individuals are creditors, the Viscount's role is to provide to the Court any conclusions or evidence it has in relation to such an assertion. Ultimately however, it may well be for the creditor concerned to set out why it is a creditor if the position is disputed or is contentious. In this case I ordered that all creditors identified by the Viscount should be notified of the proceedings and given an opportunity to indicate whether they wished to take part. I also required the Representor to file all her affidavit evidence that she intended to rely on in support of her application and to make the same available by the time creditors were to be notified of the application. This was to enable creditors to understand the stance the Representor was taking in relation to each creditor's claim and to evaluate whether that creditor wished to challenge the Representor's stance.
15. In the case of one entity listed as a creditor, Harbour Fund II LP ("Harbour"), I joined that party as a respondent. This was because the Representor was contending, by reference to the Supreme Court decision in R v Competition Appeal Tribunal and Others [2023] UKSC 28, that Harbour was precluded from making any claim in the désastre by virtue of that decision. While the Viscount may have material information the Viscount wishes to lay before the Court in relation to this argument, primarily it is for Harbour to respond to the argument advanced by the Representor, rather than the Viscount.
16. The Viscount's role is therefore limited firstly to providing information on the balance sheet test to the Court and to the other parties which the Viscount has received as part of the désastre process and any conclusions the Viscount has already reached about the information received prior to the application for a recall being made.
17. Secondly, if the balance sheet exercise results in a positive outcome, the Court must also still decide how to exercise its discretion as to whether or not to recall the désastre. The Viscount should not be fettered in making submissions on the exercise of such a discretion again while taking care not to fight battles on behalf of creditors who are able to protect their own position.
18. Accordingly, I determined that the Viscount should be joined as a Respondent to the Representation and should be entitled to have access to all material filed by the Representor.