Angel Group Ltd v British Gas Trading Ltd

A winding-up petition cannot be used to determine a debt that is genuinely disputed on substantial grounds. The court must nevertheless examine the evidence and may reject a debtor’s unparticularised objections. On a running account, the petitioner need not prove the exact balance at the interlocutory stage. It is enough to establish an indisputable net debt exceeding the statutory threshold after making proper allowance for identifiable disputes and cross-account credits.

A contractual obligation to pay estimated energy bills may support a petition. A possible future adjustment following actual meter readings does not itself create a substantial dispute or set-off. The debtor must identify a reasonably estimable counterclaim or credit.

Angel Group Ltd sought an injunction restraining British Gas Trading Ltd from proceeding on a winding-up petition and sought to strike it out. The parties operated two running energy-supply accounts for a large portfolio of properties. The accounts involved estimated readings, changes of occupier, tariff and standing-charge disputes, alleged double charging, and VAT issues.

The petition asserted a debt of £619,733.60. During the proceedings British Gas made further billing adjustments. Angel contended that no part of the balance was ascertainably undisputed and that the petition was abusive. The central issue was whether British Gas had established an indisputable net debt exceeding £750 which was not bona fide disputed on substantial grounds.

1. Application refused. British Gas had established that Angel was indebted in a sum well above £750 which was not bona fide disputed on substantial grounds. The court therefore refused an injunction restraining further proceedings on the winding-up petition.

2. The court rejected the allegation that the petition was an abuse. Further credits and billing corrections after presentation did not show that British Gas had knowingly made false averments or deliberately exaggerated the debt. With a complex running account, a time lag between accounting adjustments and the petition was unsurprising, and British Gas communicated reductions as they arose.

3. A Companies Court should not determine a substantial bona fide dispute through a winding-up petition, but it must examine the evidence. It should not allow a debtor to defeat a petition merely by raising an unparticularised cloud of objections. The relevant question was whether an indisputable debt exceeding £750 existed, not whether the exact final balance could be fixed on the application.

4. There was a triable contractual dispute about estimated bills, occupier changes, standing charges and tariff issues on the SME account. There were also genuine, but unquantified, disputes concerning some occupation changes, double payments and VAT. The Corporate Account terms, however, required payment of estimated bills. The possibility that future actual readings might produce an unspecified credit did not create a substantial dispute or set-off.

5. After excluding invoices post-dating the petition and setting off an SME-account overpayment in Angel’s favour, the Corporate Account showed a net balance of £106,541. Angel alone had the information needed to particularise remaining objections. It had not done so, and the court could make no sensible further allowance. The debt plainly exceeded £750 and was of the order of £100,000.

not stated in the judgment.