Strategic Advantages PC (for and on behalf of HSG Rooftops SP) v Gary Ronald Forrest

A bankruptcy petition may be dismissed where the petitioner seeks withdrawal or dismissal and supporting creditors do not seek substitution or carriage of the petition. Where the court cannot confirm whether registration of the petition as a pending action has occurred, it may make protective directions rather than an ineffective order based on unavailable registration details. Those directions may give the debtor liberty to provide the registration details if an application is later identified, so that registration can then be vacated.

Strategic Advantages PC petitioned for the bankruptcy of Gary Ronald Forrest in respect of an alleged debt exceeding £36 million. The petition had been contested and listed for trial. Shortly before the hearing, the petitioner applied for withdrawal or dismissal under sections 266(2) and (3) of the Insolvency Act 1986 and Rule 10.30 of the Insolvency Rules.

Two supporting creditors had been notified. Neither sought substitution as petitioner or carriage of the petition. The central issues were whether the petition should be dismissed and how the order should address possible registration of the petition with the Chief Land Registrar.

1. The bankruptcy petition was dismissed. The petitioner and respondent agreed that the matter could be dealt with by withdrawal or dismissal, and the supporting creditors did not seek any further participation, substitution or carriage. In those circumstances, dismissal was appropriate under sections 266(2) and (3) of the Insolvency Act 1986 and Rule 10.30 of the Insolvency Rules.
2. The court had not been given the reference number or registration date for any registration of the petition as a pending action. Enquiries indicated that the Land Registry had no record of an application and no pending registration, although the possibility of an overlooked or unprocessed application could not be excluded.
3. An order directing vacation of a registration on the debtor’s application would therefore have been ineffective because the relevant registration details were unavailable. The court instead adopted alternative wording to the provision contemplated by Rule 10.31(4)(g). If a pending application for registration were later identified, the respondent would have liberty to provide the date of entry and registration number and request an order vacating the registration. The court would also be informed not to seek registration if none had been made.
4. The order recorded that the petition had been heard, provided for service of sealed copies by email, and made no order as to costs.