Innovate Logistics Ltd (In Administration) v Sunberry Properties Ltd [electronic resource]
Innovate Logistics Ltd (In Administration) v Sunberry Properties Ltd [electronic resource]
- 2008
[2008] EWCA Civ 1321, 18 November 2008. Case shows that the interests of creditors of an insolvent tenant may take precedence over those of a landlord. An appellant company (R) in administration, appealed against a prior decision giving R's landlord (S) permission to commence legal proceedings seeking an order to terminate an occupational license granted by R to another company (Y). Y had bought R's business from the administrators as a going concern and was the lessee of food storage premises for six months so that it could continue trading. The administrators passed on rent payments by Y to S. S argued that the license breached the lease and sought to evict the occupier. Held: appeal allowed. The Court of Appeal refused permission for the proposed eviction. It ruled that Y could continue to trade at the premises, allowing creditors to recover debts, as long as S continued to receive its rent. The Court considered that the administration benefitted S by securing rent. The original judge ought to have carried out the balancing exercise required by authority between the interests of S and those of the other creditors and considered if the application was equitable. Atlantic Computer Systems Plc, Re applied.
ATLANTIC COMPUTER SYSTEMS PLC, RE
INSOLVENCY ACT 1986
England and Wales--1543-
[2008] EWCA Civ 1321, 18 November 2008. Case shows that the interests of creditors of an insolvent tenant may take precedence over those of a landlord. An appellant company (R) in administration, appealed against a prior decision giving R's landlord (S) permission to commence legal proceedings seeking an order to terminate an occupational license granted by R to another company (Y). Y had bought R's business from the administrators as a going concern and was the lessee of food storage premises for six months so that it could continue trading. The administrators passed on rent payments by Y to S. S argued that the license breached the lease and sought to evict the occupier. Held: appeal allowed. The Court of Appeal refused permission for the proposed eviction. It ruled that Y could continue to trade at the premises, allowing creditors to recover debts, as long as S continued to receive its rent. The Court considered that the administration benefitted S by securing rent. The original judge ought to have carried out the balancing exercise required by authority between the interests of S and those of the other creditors and considered if the application was equitable. Atlantic Computer Systems Plc, Re applied.
ATLANTIC COMPUTER SYSTEMS PLC, RE
INSOLVENCY ACT 1986
England and Wales--1543-