Sands v (1) Layne (2) Wycombe District Council  EWHC 3665 (Ch);  BPIR 163
(Chancery Division, David Donaldson QC
(sitting as a deputy High Court judge), 12 November 2014)
The decisions of appellate courts are not
reviewable under s 375(1) IA.
The First Respondent (‘CL’) was declared
bankrupt on the Second Respondent’s (‘WDC’) petition. CL appealed the decision
to the High Court where it was disposed of by consent. The consent order
provided that WDC would be given security over CL’s home and that he would also
make monthly payments to discharge his indebtedness.
Almost a year after the consent order was drawn
by the court, CL’s Trustee in Bankruptcy appealed the consent order on the
basis that the court had failed to give sufficient regard to the interests of
the Bankrupt’s (CL’s) other creditors.
The issue upon which the court had to rule was
whether s 375(1) of the Insolvency Act 1986 (‘IA’) (which provides a court
with jurisdiction to review or vary its own order) is applicable when the court’s
decision is made pursuant to s 375(2) (appeal from the decision of a
County Court Judge or a Registrar in the High Court).
The judge held that s 375(1) did not give a
litigant an unlimited right to a second bite at the cherry. The court would
only review its own orders in the light of fresh evidence or a change of
circumstances. In Appleyard v Wewelwala
 EWHC 3302 (Ch), the High Court had held that the decisions of appellate
courts could not be reviewed under s 375(1). Whilst the judge was of the
view that this could create potential anomalies, he did not find that the
decision in Appleyard v Wewelwala was
wrong and therefore he concluded that he was bound by it.
The judge then addressed
the question of whether, in the event that he was wrong to find that the
decision was not susceptible to review, the interests of creditors were a
material consideration under s 271(3), which set out the grounds upon
which the court could dismiss a bankruptcy petition. The judge held that the
creditors’ interests were not material considerations, it being neither
necessary nor appropriate for their interests to be considered in the context
of a dispute between the petitioning creditor and the debtor.