Retrospective Consent of Administrator

April 15, 2014

The recent case of Cyril Fulton And Ernest Fulton v. AIB Group (UK) Plc considered whether an Administrator has power to provide retrospective consent to commencement of legal proceedings against a Partnership.

This was the first time this matter was given considered the court, by Mr Justice Horner was the appointed Judge.

Consideration was given to the case of the Governor of the Company of the Bank of Ireland v Colliers International (UK) Plc (Administration where legal proceedings commenced in breach of the moratorium were cured by the retrospective grant of court permission. The judge in that case commented “in the case of administration, where consent may be given by the administrator, I can think of no convincing reason why an administrator should not be permitted to grant retrospective consent.”

Mr Justice Horner agreed with this reasoning, which he described as highly persuasive. He concluded that the administrators consent can have retrospective effect and was satisfied that no grounds remained which would permit the court to set aside either the statutory demand issued in respect of partnership liabilities or the statutory demand issued in respect of guarantee liabilities.

The case is noteworthy on a number of other points as Mr Justice Horner explains why Bankruptcy or Winding up proceedings are a „legal process‟ under the Insolvency legislation. He also sets out the basis upon which a debt can be considered as a „liquidated amount‟ even when security has not yet been realised.

Please note ; the content of this article is for information purposes only and further advice should be sought from a professional legal advisor before any action is taken.
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