Barclays Bank Plc (t/a Barclays Global Payment Acceptance) v The Registrar of Companies & Ors

This was a first instance decision on whether a creditor may have a dissolved company restored to the register, seek its winding up and obtain a direction under s.1032(3) Companies Act 2006 to treat the winding‑up petition as presented at an earlier date. The court held that restoration under section 1029 may be granted where it is "just" to do so and where creditors with an economic interest justify investigation of the company’s books and transactions. The former administrator had standing to apply to set aside the restoration order but no sufficient grounds were shown to rescind it. The court made a winding‑up order but refused to give the retrospective direction under s.1032(3) because the applicant had not shown what new material emerged after dissolution, and affected third parties had not been given fair notice. The judgment explains the limited and cautious exercise of the s.1032(3) power and the relationship between administration, dissolution and the periods relevant to actions under Insolvency Act 1986 sections 238–240 and Schedule B1.

Background and parties. Client Connection Limited entered administration on 9 October 2012 and was dissolved on 26 December 2013. Barclays, the principal creditor (c.£2m), alleged there were transactions requiring further investigation. Barclays applied to restore the company, to wind it up and to obtain a direction under s.1032(3) Companies Act 2006 deeming the petition to have been presented at an earlier date so that a liquidator could pursue claims available during the administration.

Procedural posture. District Judge Troy restored the company to the register and adjourned other relief. The present hearing determined: (i) whether the District Judge’s restoration order should be reviewed or rescinded; (ii) whether the company should be wound up; and (iii) whether the petition should be treated as presented on an earlier date.

Issues framed by the court.

• Did the former administrator (Ms Sharma) have standing to challenge restoration and intervene?
• Was it just to rescind the restoration order?
• Should a winding‑up order be made?
• Should the court exercise its s.1032(3) power to backdate the presentation of the petition (to create a seamless insolvency and preserve limitation or the "relevant period" for sections 238–240 claims)?

Reasoning and conclusions. The judge held that Ms Sharma had an interest and standing to challenge the restoration. Rule 7.47 did not apply but there was jurisdiction to entertain her challenge. Restoration was not inconsistent with the creditors’ approval of dissolution and may properly be sought by a creditor to enable investigation; the administrator’s limited investigations and failure to disclose their content weighed in favour of restoration. The court endorsed that restoration may be appropriate to recover or to investigate books and records even where asset recovery is uncertain. The court therefore refused to rescind the restoration and made a winding‑up order.

As to s.1032(3), while that provision permits wide directions to put persons "as nearly as may be" in the position they would have been had the company not been dissolved, it must be exercised with caution. The court refused to direct that the petition be deemed presented on an earlier date because Barclays had not shown what new material after dissolution justified such a direction, and because potentially affected third parties had not had fair notice. The judge therefore made the winding‑up order but declined the retrospective backdating direction.

At first instance the court refused to set aside the restoration order, held that the former administrator had standing to oppose the relief, ordered that the restored company be wound up, but refused to exercise the s.1032(3) Companies Act 2006 power to treat the petition as presented on an earlier date. The judge concluded restoration was "just" given the limited investigations by the administrator and the creditor's evidence, but that backdating the petition would be unjust in the absence of identified new material and fair notice to affected third parties.