A Company

A creditor has no standing to present a winding-up petition where the debt relied on is disputed on substantial grounds. An injunction may restrain presentation of the petition. The existence of a substantial cross-claim may reinforce that conclusion, particularly where the cross-claim substantially exceeds the amount demanded.

The company applied for an injunction restraining Publishing 2000 Group Limited from presenting a winding-up petition based on a statutory demand dated 23 December 2004. The demand sought payment of two invoices totalling £320,439.27.

The company asserted that the debt was disputed on substantial grounds and that it had a cross-claim for approximately £800,000. An earlier without-notice injunction was continued before Mr Justice Rimer. The application was unopposed.

1. The application was granted. Publishing 2000 Group Limited was restrained from presenting a winding-up petition against the company.
2. The evidence established substantial grounds for disputing whether any part of the debt claimed in the statutory demand was due.
3. The company also had, at minimum, an arguable cross-claim of approximately £800,000. That cross-claim substantially exceeded the £320,439.27 demanded.
4. In those circumstances, the debt was disputed on substantial grounds. Publishing 2000 therefore had no locus standi as a creditor to present a winding-up petition against the company.

Not stated in the judgment.