15(1)A person may not appoint an administrator under paragraph 14 unless—
(a)he has given at least two business days’ written notice to the holder of any prior floating charge which satisfies paragraph 14(2), or
(b)the holder of any prior floating charge which satisfies paragraph 14(2) has consented in writing to the making of the appointment.
(2)One floating charge is prior to another for the purposes of this paragraph if—
(a)it was created first, or
(b)it is to be treated as having priority in accordance with an agreement to which the holder of each floating charge was party.
(3)Sub-paragraph (2) shall have effect in relation to Scotland as if the following were substituted for paragraph (a)—
“(a)
it has priority of ranking in accordance with section 464(4)(b) of the Companies Act 1985 (c. 6) , ".
Cases considering Schedule B1, paragraph 15 10
[2017] EWCA Civ 1001 · 25 July 2017Interprets
The notice-or-consent procedure permits a lower-ranking floating charge holder to appoint administrators while preserving a prior floating charge holder’s opportunity to appoint its preferred administrators. It confirms that prior security does not make the later charge unenforceable. (see paras [30]-[32])
[2021] EWHC 94 (Ch) · 20 January 2021Interprets
The court held that failure to give notice to the holder of a prior qualifying floating charge was a procedural irregularity, not a fundamental defect automatically invalidating the appointment. The failure could be remedied under rule 12.64 where no substantial injustice resulted. (see paras [30]-[32]; [46]-[47])
The court applied the notice requirement in paragraph 15(1) and found that notice should have been given to the appropriate successor or representative of the prior security interest. (see paras [13]-[14]; [25]-[27])
The court applied the requirement for at least two business days’ written notice to the holder of a prior qualifying floating charge. The absence of notice was not treated as automatically fatal to the appointment. (see paras [32]; [46]-[47])
The court recognised written consent by the prior qualifying floating-charge holder as an alternative to notice, while deciding that the failure to comply with the paragraph remained curable in the circumstances. (see paras [32]; [44]-[47])
The court used the statutory priority rule to identify the Tudor security as prior to Metro’s later security. (see paras [11]-[13]; [32])
[2020] EWHC 1133 (Ch) · 7 May 2020Limits
Paragraph 15 is used as a comparison with the FCA-consent requirement. The judgment treats requirements protecting a prior charge holder’s opportunity to act as potentially fundamental (see paras [30], [72], [112]-[116]).
What each judgment says about Schedule B1, paragraph 15 is in the case-law panel in the full Act.