Brooks and another (Joint Liquidators of Robin Hood Centre plc in liquidation) v Armstrong and another

Liquidation – Voluntary winding up. The Chancery Division allowed, in part, a cross-appeal by the directors of a company in creditors' voluntary liquidation against an order that they were jointly and severally liable to pay compensation of £35,000 for wrongful trading in respect of a company in liquidation. The directors had argued that the process by which the registrar had calculated the compensation payable by them had been unfair. The court held that the liquidators had failed, in the earlier proceedings, to advance and establish a properly formulated case that there had been any increase in net deficiency of the company during the period of wrongful trading, and that, on the approach adopted and facts found by the registrar, there had been no such increase. Accordingly, it held that the registrar should not have ordered any payment by the directors to the liquidators, under s 214(a) of the Insolvency Act 1986.

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