Court Upholds Winding-up Order Against Property Services LDN Ltd

Re Lendinvest BTL Ltd v Property Services LDN Ltd ?[2023] EWHC 1778 (Ch) (18 July 2023)

In a recent case, Property Services LDN Ltd (hereafter referred to as the "Respondent Company") faced a winding-up order after failing to pay a costs order of ￡20,000, which was made against it in previous legal proceedings where it was the claimant. The Chancery Division allowed the petitioner's application for winding-up, leading to the legal dissolution of the Respondent Company.

The petitioner, a commercial lender specialising in short-term bridging finance, had provided financial services to Laverstock Management Corporation Ltd (Laverstock). The main issues in the case were twofold:

(i) Validity of the Costs Order:

The court needed to determine whether the costs order made against the Respondent Company was 'flawed' and 'invalid'. The contention here was that the interested parties, including the petitioner, were not joined to the proceedings as they should have been under CPR 46.2(1)(a).

(ii) Crossclaim for Damages:

The Respondent Company claimed that it had a serious and genuine crossclaim for damages in tort against the petitioner. The basis of this claim was that the petitioner induced or procured Laverstock to breach its contracts to sell properties to the Respondent Company.

The court, after careful consideration of the arguments presented, upheld the costs order against the Respondent Company. It was noted that the order had not been challenged or appealed, and it was made on the company's application to set aside or discharge the order made on the application of the 'interested parties', including the petitioner.

Furthermore, the alleged crossclaim for damages in tort against the petitioner was not deemed to be properly articulated and lacked proper evidence. The court found no substantiated evidence to suggest that the petitioner acted wrongfully or induced Laverstock to breach its contracts with the Respondent Company. Additionally, there was no adequate explanation provided regarding how such inducement was said to have occurred.

As a result of the court's decision, the winding-up order against the Respondent Company stands, leading to its dissolution.

NB Facing insolvency or have you received a winding-up petition? Contact us today 0207 467 3980 https://bit.ly/3irysFy