BWCI Pension Trustees Ltd v Hurst House Holdings Ltd & Ors

In the Applications Court, asserted commercial urgency must be assessed against the practical steps required to complete the proposed transaction. Where completion depends on a sale which is unlikely to occur within the necessary timetable, and a further application is required to authorise the transaction during a winding-up petition, the matter is not suitable for immediate determination.

Where an application to discharge an injunction is closely connected with the substantive relief sought in an unfair-prejudice petition, the court may direct that both matters proceed together urgently to trial or another suitably listed hearing. The Applications Court’s usual time constraints must also be respected.

The petitioner, a pension trustee and shareholder in Hurst House Holdings Ltd, presented an unfair-prejudice petition concerning proposed transfers of subsidiary companies and assets to a company controlled by the second respondent. An injunction restraining the proposed transactions had previously been granted and continued until trial.

The respondents applied urgently to vary the injunction. They argued that the proposed transaction was necessary to raise funds and avoid insolvent liquidation. The court had to decide whether the application was sufficiently urgent for determination in the Applications Court and, if not, what procedural course should follow.

1. The application to vary the injunction was not determined in the Applications Court and the injunction remained in force until trial. The court was not satisfied that the asserted urgency justified proceeding with a matter estimated to require substantially more than the ordinary Applications Court time allowance.
2. Urgency had to be tested by reference to the transaction’s actual requirements. The proposed mechanism depended on raising £300,000 through a sale to NGT. Draft contracts had only recently been sent, and completion by the date of the pending winding-up petition was improbable. In addition, no application under section 127 of the Companies Act had yet been prepared or issued, although such an application would be needed to permit the proposed disposition during the winding-up petition.
3. The court recognised the established practical limitation that matters taking more than about two hours should not ordinarily be heard in the Applications Court. That limitation preserved capacity to deal with genuinely urgent ex parte applications and to prepare for the following day’s list.
4. The injunction application was closely related to the unfair-prejudice petition. Discharging the injunction could, given the limited nature of the petition, confer in substance the relief which the respondents would seek by successfully resisting the petition. The appropriate course was therefore for the petition and the application to vary the injunction to proceed together, with further evidence and directions, and with urgent listing by the Listing Office at the earliest practicable date.