Brian English v Secretary of State for Business and Trade

A prohibition on re-use of company names under the Insolvency Act 1986, s 216(3), expressly extends to involvement in a non-corporate business trading under a prohibited name. The Third Excepted Case in rule 22.7 of the Insolvency (England and Wales) Rules 2016 is, however, drafted by reference to a company and corporate dormancy provisions. It cannot be judicially expanded to cover a sole trader or to add an alternative established-and-trading test. The natural and ordinary meaning controls. The rule was not shown to be ultra vires or unreasonable, and no rectifying construction was permissible. The statutory leave mechanism remains available where the prohibition reaches beyond the policy mischief.

This was an appeal by case stated under section 111 of the Magistrates Courts Act 1980 from Poole Magistrates’ Court. The appellant, formerly a director of an insolvent company, had continued a sole-trader business under a name similar to the liquidated company’s name. He had been convicted of breaching section 216(3)(c) of the Insolvency Act 1986. The magistrates’ judge referred whether the Third Excepted Case in rule 22.7 of the Insolvency (England and Wales) Rules 2016 applied to an unincorporated business as well as an incorporated association. The central issue was whether the court could read additional words into the rule.

Disposition. The appeal was dismissed. The referred question was answered no: rule 22.7 does not apply to an unincorporated business as well as to incorporated associations.

1. Statutory structure. The prohibition in section 216 arises from a name used by the liquidating company before liquidation. Limb (c) deliberately extends the prohibition to involvement in a business carried on otherwise than by a company under a prohibited name.
2. Meaning of rule 22.7. The phrase company there referred to means a company. The rule was designed around the corporate dormancy provisions in section 1169 of the Companies Act 2006, which in turn engage the corporate accounting-records duties in section 386. There was no legitimate basis for adding a reference to business or an alternative established-and-trading condition.
3. No rectifying construction. The natural and ordinary meaning of the rule was clear. The provision was not shown to be ultra vires or unreasonable. Expanding it would amount to judicial rule-making, whereas the statutory power to make or amend the insolvency rules belonged to the Lord Chancellor.
4. Safeguard. The leave mechanism in section 216(3), including the prompt-application procedure in rule 22.6 and the right of the Secretary of State or official receiver to be heard under section 216(5), provided a means of addressing cases said to fall beyond the policy mischief. The scheme was therefore neither unfair nor incoherent.

The appellant was ordered to pay the respondent’s costs, to be assessed if not agreed.

1. High Court (Administrative Court) — On the appeal by case stated, the court dismissed the appeal and answered the referred question in the negative: [2026] EWHC 1711 (Admin) .
2. Poole Magistrates’ Court — Following a trial, the appellant was convicted on 21 November 2024. The district judge stated the question for the High Court under section 111 of the Magistrates Courts Act 1980 and had answered it no.