Ciaran Charles Little & Anor v Olympian Homes Limited

For an application to set aside a statutory demand, “substantial grounds” require a genuine triable issue, equivalent in substance to a real prospect of success. A merely arguable dispute is insufficient, and a factual dispute must support a legally recognisable defence.

A contractual waiver may fail where the contract requires writing and the evidence shows no clear request, acceptance or consideration. Promissory estoppel is distinct. It may arise despite a no-oral-variation clause and without consideration, but requires a clear representation or conduct, intended reliance, reasonable reliance or change of position, and consideration of whether it would be inequitable to resile.

The applicants sought under rule 10.4 of the Insolvency (England and Wales) Rules 2016 to set aside statutory demands for approximately £102,165.81 claimed under personal guarantees securing a facility agreement.

They argued that interest had been waived contractually or that the respondent was estopped from recovering it. The applications were filed six days late. The central questions were whether the debt was disputed on substantial grounds, whether the demands were abusive, and whether time should be extended.

1. Disposition. The applications were granted. The statutory demands were set aside, and a further hearing was directed for consequential relief unless agreed.
2. Under rule 10.5(5)(b) of the Insolvency (England and Wales) Rules 2016, the applicants had to establish a genuine triable issue. This was materially the same as a real prospect of success. The threshold was not low, and a dispute had to support a legally coherent and legally recognisable defence.
3. The contractual waiver case failed. The facility agreement contained an effective requirement that waivers be in writing. The October emails contained no clear request that interest be waived and no clear acceptance. The alleged consideration was not shown to have been communicated or agreed. If the arrangement was a variation, it also required consideration and compliance with the amendment clause. Emails qualified as writing, and the relevant emails were electronically signed, but those findings did not cure the substantive defects.
4. The promissory-estoppel case disclosed a genuine triable issue. The 10 October email objectively represented that the principal debtor and applicants were released from the facility and guarantees, and the accompanying draft deed supported that representation. The alleged earlier discussion and subsequent conduct provided relevant context. It was arguable that the representation was intended to be relied upon, that reliance was reasonable, and that the applicants changed position by failing to arrange payment and, in the case of the first applicant, agreeing to interest-free lending. Consideration was unnecessary. Whether it would be inequitable to resile was also a triable issue.
5. The abuse-of-process ground added nothing because the debt was already substantially disputed. The six-day delay was de minimis, the explanation was acceptable, and there was no prejudice. An extension was therefore granted.

First-instance decision. No prior appellate decision is stated in the judgment.