Peter Raymond Henrikson & Ors v Charles Riley Constant & Ors

The court rejected the Henrikson Parties' application under section 1096 of the Companies Act 2006 to rectify the register by marking Truth Data Insights (Holdings) Limited as dissolved, finding that the Company was restored validly and that the presence of the restoration material on the register did not, on balance, cause or risk damage to the Company sufficient to justify removal. The judge held that at the date of striking off (6 November 2018) the Company was not "carrying on business" or "in operation", but the section 1096(3) balancing exercise required the court to consider the Company's interest in remaining on the register to pursue the Texas litigation versus the interests of third parties in the register remaining accurate. The court dismissed the Henrikson Dissolution Application but granted relief under section 125 to create a register of members and to record the stock transfer made via the Bona Vacantia Division: the Share was to be registered as jointly held by the SR Trust and the HF Trust (in that order) with retrospective effect from 27 May 2021. The court also declared invalid and ordered removal from the register of the purported director appointments and terminations filed in September 2020 under section 1096.

This is a first instance Companies Court decision concerning applications about the status of Truth Data Insights (Holdings) Limited following its administrative strike off and subsequent administrative restoration. The factual backdrop is a dispute between two former co‑founders about beneficial interests in a Texas limited liability company (TDI LLC) and the role of English holding companies incorporated for tax structuring.

Parties and procedural posture:

• The Henrikson Parties sought, by Part 8 claim, declarations and orders under section 1096 (rectification) to mark the Company as dissolved and to remove the Restoration Form and subsequent filings from the register (the Henrikson Dissolution Application).
• Mr Constant cross-applied under section 1031 to restore the Company and under section 125 for rectification of the register of members (the Constant Restoration and Constant Rectification Applications). There was also an injunction application that became largely academic after interim undertakings.

Key issues:

• Whether the administrative restoration via form RT01 was void, invalid or factually inaccurate because the Company was not "carrying on business or in operation" when struck off under section 1025 of the Companies Act 2006.
• Whether the documents delivered to the Registrar on restoration were "properly delivered" as required by section 1025(5).
• If material on the register was factually inaccurate or derived from invalid acts, whether the court should order removal under section 1096 having applied the balancing exercise in section 1096(3) (the Company’s interest in removal versus interests of other persons in the material remaining).
• Whether the stock transfer effected by the Bona Vacantia Division (BVD) was void because it named both trusts while only one trust had negotiated the purchase, and whether the register of members should be rectified under section 125 to reflect beneficial or legal interests and the order of joint holders.

Court’s reasoning and rulings:

• The judge concluded, on the balance of probabilities, that the Company was not "carrying on business" nor "in operation" when struck off in November 2018: the company acted only as a holding vehicle, its filed accounts described it as dormant, directors’ minutes recorded adoption of dormant accounts and a resolution to dissolve, and there was no evidence of active steps to assert or develop rights under the disputed Subscription Agreement.
• However, the statutory conditions for administrative restoration involve separate elements. The documents submitted on restoration were "properly delivered" in the technical sense required by the Registrar's delivery rules and related provisions: there was no ground to treat delivery as improper because of alleged internal defects in board approval.
• Applying section 1096(3), even accepting factual inaccuracy of the Restoration Form, the court concluded that removal was not justified because the Company’s interest in remaining on the register to pursue the Texas litigation and potential recovery outweighed the interest of other persons in the material remaining on the register. The court refused to pre‑judge the merits of the Texas proceedings and noted the risk of extinguishing any real chance of recovery by scrapping the restoration.
• On the Bona Vacantia transfer, the court held the contract by which the SR Trust paid the BVD for the stock transfer form that named both trusts was not void. The HF Trust was treated as a volunteer for having been named without paying consideration. The court exercised its section 125 discretion to order creation of a register of members and to record the SR Trust and the HF Trust as joint holders of the single share (in that order) with retrospective effect from 27 May 2021 when the transfer form was delivered to the Company's registered office. The court added that if the HF Trust disclaims membership, the SR Trust (having paid) should be registered sole legal owner.
• Finally, the court declared the September 2020 filings purporting to change directors invalid and ordered the Registrar to remove them under section 1096, because at the relevant time the share was vested in the Crown and the procedural requirements for valid appointment/removal were not satisfied.

The judgment emphasises the interplay between technical compliance with registrar delivery requirements and the substantive balancing exercise under section 1096(3), and recognises the court’s discretion to preserve a company’s procedural capacity to pursue substantive claims abroad despite defects in its prior status.

This is a first instance judgment. The Henrikson Dissolution Application (seeking removal of the Restoration Form and marking the Company as dissolved) is dismissed because, although the Company was not "carrying on business or in operation" when struck off, the section 1096(3) balancing exercise favoured leaving the Company restored so it can pursue its Texas litigation. The court ordered, under section 125 of the Companies Act 2006, that a register of members be established and that the single issued share be registered as jointly held by the SR Trust and the HF Trust, in that order, with retrospective effect from 27 May 2021; if the HF Trust declines to be entered, the SR Trust should be registered as sole legal owner. The court also declared the September 2020 filings relating to directors invalid and directed the Registrar to remove them under section 1096. The reasoning was that removal of the restoration material would unjustifiably extinguish the Company’s ability to pursue potentially substantive rights in the United States and that the Bona Vacantia transfer was not void despite the HF Trust not having provided consideration.