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Insolvency Law

Expert guidance on all aspects of corporate and personal insolvency

26 SEP 2013

Darbyshire v Turpin and Another [2013] EWHC 954 (Ch); [2013] BPIR 558

(Chancery Division, Arnold J, 1 March 2013)

D applied to set aside a statutory demand that had been served on him on 18 January 2010. That application was dismissed on 27 April 2010, but the order did not include any date on or after which a bankruptcy petition could be presented. It was presented the following day. Eventually, in the face of opposition from D on the grounds of asserted cross-claims, a bankruptcy order was made on that petition on 28 May 2012 and D appealed. Arnold J allowed the appeal and remitted the petition for directions and a further hearing. The purpose of r 6.5(6) of the Insolvency Rules 1986 was to enable the debtor to ask for time in which to pay the debt before a petition was presented or, if not to pay the debt, to try to arrive at some compromise. If no date was specified in the order, r 6.5(6) should not be interpreted as prohibiting the petitioner from presenting a petition forthwith. But, the district judge had been wrong to dispose of the petition summarily without giving D the chance to substantiate the grounds of opposition by evidence as, if the cross-claims were substantiated in evidence they would extinguish the petition debt. 

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