The Insolvency Act 1986 contains an armoury of sections empowering the court, on an application by an office-holder of an insolvent estate, to avoid (set aside/render void) antecedent voidable transactions where the relevant criteria is satisfied. One such section, is section 423 of the Insolvency Act 1986, though its application is not limited to insolvent estates, and, importantly for the purpose of this article, is not limited to office-holder applicants. There is an additional category of eligible applicant with s.423, namely ’a victim’ of the (impugned) transaction. Sometimes however, the law requires that where such ‘a victim of the transaction’ wishes to issue an application under s.423, that would-be applicant must obtain leave of the court (i.e. court permission) in order to issue.
This article will explore: (1) when ‘a victim of the transaction’ requires leave and, where leave is required, (2) in what circumstances might it be granted. It will consider the cases of Carillion Construction Ltd v Zelf Hussain and Robert Jonathan Hunt (the joint liquidators of Simon Carves Ltd); Re Simon Carves Ltd (in liquidation)  EWHC 685 (‘Simon Carves’), Dora v Simper  BCLC 561;  BCC 836;  Lexis Citation 2600 and  Lexis Citation 2146 (‘Dora’), Godfrey v Torpy (No.2)  EWHC 919 (Ch) (‘Godfrey’), Menzies v National Bank of Kuwait SAK  B.C.C. 119 (‘Menzies’), Bank of Scotland Plc (t/a Birmingham Midshires) v Breytenbach  B.P.I.R. 1 ('Breyenbach') and Lemos v Church Bay Trust Co Ltd  EWHC 1173 (Ch)('Lemos')
Section 424 of the Insolvency Act 1986 - Who May Apply for a s.423 Order
Section 424 of the Insolvency Act 1986 ('IA 1986') sets down who may apply for a s.423 order, and when a would-be applicant requires leave of the court. That section is entitled ‘Those who may apply for an order under s.423’ and s.424(1) provides:
‘An application for an order under section 423 shall not be made in relation to a transaction except-
(a) in a case where the debtor has been made bankrupt or is a body corporate which is being wound up or is in administration, by the official receiver, by the trustee of the bankrupt’s estate or the liquidator or administrator of the body corporate or (with the leave of the court) by a victim of the transaction;
(b) in a case where a victim of the transaction is bound by a voluntary arrangement approved under Part I or Part VIII of this Act, by the supervisor of the voluntary arrangement or by any person who (whether or not so bound) is such a victim; or
(c) in any other case, by a victim of the transaction.’
So in short, the law stipulates that a ‘victim of the transaction’ does not require leave to apply for a s.423 order unless the debtor/transferor[2a] has, if an individual, been made bankrupt, or if the debtor is a body corporate, is being wound up (in liquidation) or is in administration. Where leave is required, the question then becomes the question posed by Sir William Blackburne in Simon Carves, in the High Court, at paragraph 27:
‘What are the circumstances in which the court will give leave to a victim of the transaction to bring proceedings under section 423 in cases where the debtor, being an individual, has been adjudged bankrupt or, being a body corporate, is being wound up or is in administration?'
Discretion and Important Considerations
Whether any particular circumstances warrant leave being granted is a matter of discretion for the Court[2b]. In exercising that discretion, there are, seemingly, at least two important considerations for the Court:
(1) whether the office-holder at the 'helm' of the relevant insolvency regime has considered and/or declined to bring s.423 proceedings, and if declined, why now the would-be applicant should be permitted to bring s.423 proceedings; and
(2) the prospects of success of the proposed s.423 application (a merits based test);
Insolvent Estate already has an Office-holder Appointed
A bankrupt estate or a company (in liquidation or administration)’s estate, will have at the ‘helm’ one of the 4 office-holders listed, administering the insolvent estate:
(1) The bankrupt estate will have either the official receiver or a private insolvency practitioner; and
(2) A company in liquidation or administration, will have at the ‘helm’, a liquidator or administrator.
(together, the 'insolvency regimes').
Parliament has decided that these office-holders are entitled to make an application under s.423, whereas, as Buckley J said in Dora, at page 6 'It is only with the Court's leave that a victim of any transaction may do so''. This is an indication of how the law categorizes who might be the proper applicant for a s.423 application. That the ‘victim of the transaction’ would-be applicant is not, prima facie, the proper applicant for a s.423 application. This is because a s.423 application is a class remedy/action[5a].
Section 424(2) reads:
‘An application made under any of the paragraphs of subsection (1) is to be treated as made on behalf of every victim of the transaction.’
The relief typically awarded on a s.423 will be that the impugned antecedent voidable transaction is set aside (rendered void/avoided)[5b] and an order made restoring back into the debtor's insolvent estate (on restitutionary based principles), the transferred out property/value. This is for the benefit of the general body of creditors, not for any particular individual. As Sir William Blackburne said in Simon Carves, at paragraph 25:
‘By restoring the position to what it would have been if there had been no transaction the relief which the court grants is for the benefit of the creditors as a whole. This is mirrored in section 424(2)…’
The relevant office-holder appointed to the relevant insolvency regime is charged with performing his obligations for the benefit of the general body of creditors to that estate. Therefore, prima facie, it ought to be the office-holder (tasked with looking after the general body of creditors and holding professional skills), and not an individual victim/creditor (who may wish to look after his own interests and may lack the same professional skills) who commences and steers class remedy/actions.
Giving judgment in one instance of this (where the debtor company was in liquidation), but having, seemingly, much broader application, Sir Christopher Slade in Menzies made this point, at 122C to D, that:
‘…prima facie the proper plaintiff in proceedings to recover property or obtain reimbursement for the benefit of a company in liquidation is the company itself acting through its liquidator; the circumstances in which such proceedings can properly be brought in a winding up by a person other than the company or its liquidator are to be regarded as exceptions to the general statutory principle…’ (‘Proper Plaintiff’)
In Lemos, ICCJ Barber said, at paragraphs 57 an 58:
'The legislature has recognised that in cases where the debtor (for the purposes of s.423(5)) is bankrupt, the official receiver or the trustee in bankruptcy are the most appropriate persons to bring s.423 proceedings. This is reflected in s.424(1) IA 1986, which requires all other persons wishing to bring s.423 proceedings to seek the leave of the court.
The [joint trustees in bankruptcy/applicants for joinder] have a clear and direct economic interest in the outcome of the proceedings. As the trustees in bankruptcy of [the bankrupt], they have a duty to get in the assets of [the bankrupt's] estate for the benefit of his creditors as a whole. Any recovery made in the proceedings will be an asset of [the bankrupt's] estate which the [joint trustees in bankruptcy/applicants for joinder] will have to deal with as part of their administration of his estate. They are the obvious people to prosecute the s.423 claim...'
In Simon Carves, Sir William Blackburne, quoted this Proper Plaintiff passage, at paragraph 27, seemingly with approval. Then, as part of his formulation of the considerations on granting leave, Sir William Blackburne said the Court would consider whether the would-be applicant has a 'realistic prospect of establishing’ that ‘there is good reason why he should bring the proceedings even though the liquidator or administrator does not.’ This phraseology:
(1) rather suggests that the relevant office-holder is expected to have given consideration to the issue and declined to issue his own s.423 proceedings, prior to the application for leave. Where the relevant office-holder has considered and declined to issue, the would-be applicant will have to satisfy the Court that there is a ‘good reason’ why, though that independent professional has declined to issue, the would-be applicant ought to now be able to commence the action for a class remedy; and
(2) involves the curious inclusion of the preceding phrase ‘realistic prospect of establishing; considered in a footnote[5c]
Sufficient Merits to Would-be Applicant’s Application
It is clear that the court will take into account the merits of the s.423 application proposed, including the likelihood that the would-be applicant is 'a victim of the transaction' (i.e standing)
In Menzies, a creditor of the debtor company (in liquidation) sought leave to commence s.423 proceedings. In determining the application, Sir Christopher Slade considered it a material consideration whether the ingredients to the proposed s.423 application had ‘realistic prospects’ of being established. This can be seen from Sir Christopher Slade's conclusions, at 126 and 128, that the creditor/would-be applicant had ‘no realistic prospect’ of establishing that a certain document, the 1987 letter of instructions, ’…constituted a transaction ‘entered into at an undervalue’ in the relevant sense’ (at 128) - which is of course a necessary ingredient in any s.423 application. Because of this, he continued ‘his s.423 claim would therefore be bound to fail in limine.’(at 126)
In Simon Carves, Sir William Blackburne, formulated the legal position, at paragraph 27, as follows:
'It is not sufficient, therefore, for the victim, in cases where the office holder declines to bring proceedings to set the transaction in question aside, simply to show that he is a victim of the transaction. The court has a discretion in the matter. The applicant must demonstrate that he has a realistic prospect of establishing, first, that the transaction in question comes within the scope of section 423 and he is a victim of the transaction…’
Prospective and Retrospective Leave
Where the debtor is in a relevant insolvency regime, s.424(1) sets down that a s.423 application ‘shall not be made…except...(with the leave of the court) by a victim of the transaction’. So, a s.423 cannot be made (issued/commenced) until leave has been obtained to do so. Leave is something that must be obtained before the s.423 application is issued/commenced.
Where proceedings are commenced without leave they are irregular and are liable to be struck out, unless leave can be obtained retrospectively. Retrospective leave is sometimes called 'leave nunc pro tunc’.
In Dora, Buckley J considered, amongst other things, an application to strike out a claim (for conspiracy and under s.423), issued by a plaintiff against 4 Defendants. The plaintiff was a judgment creditor of the judgment debtor 3rd Defendant, a company in liquidation. Also a defendant was the purchaser of assets from the judgment debtor company, while the judgment debtor company had been in administrative receivership (just prior to liquidation). Though the judgment debtor company was in liquidation when the claim was issued, the plaintiff had issued without first obtaining leave under s.424(1). Subsequently the plaintiff applied for retrospective leave to make the s.423 claim.
Buckley J said:
'I heard interesting submissions from Counsel as to whether in any event I had jurisdiction to grant leave retrospectively. In view of the conclusions I have reached it is not necessary to resolve the point....Without wishing to express a considered view, my present impression is that the jurisdiction should exist and that the Court could in the exercise of it, sufficiently protect the liquidator's position.'
On the facts, Buckley J said 'In all the circumstances I do not consider it appropriate to grant leave retrospectively in respect of the s.423 proceedings... I consider that the Plaintiff should reconsider the position carefully and only if so advised reapply for leave.'
Consequently, he struck out the s.423 claim from the rest of the claim (since it had no leave). The Court of Appeal refused permission to appeal (Dora v Simpler  Lexis Citation 2146).
The ability of the Court to grant leave to regularise the proceedings was confirmed, albeit obiter, in Godfrey. In Godfrey, Mr Godfrey had, in earlier proceedings, obtained a declaration that Mrs Powers held legal title to a property (The Old Rectory) on trust for herself (50%) and for him (50%). Ms Powers was also, amongst other things, ordered to pay costs to Mr Godfrey. Mr Godfrey then alleged, amongst other things, that certain transfers of 2 properties (‘Shamrock’ and ‘Harewood Avenue’) from Mrs Powers to others, were antecedent vulnerable transactions liable to be set aside under s.423. He issued a s.423 application and, importantly, while the s.423 was ongoing, Mrs Powers was adjudged bankrupt.
Peter Leaver QC sitting as a deputy High Court judge in Godfrey found that the statute provided for 'leave to commence', but stipulated no 'leave to continue' requirement if the debtor became bankrupt after s.423 proceedings were commenced by a ‘victim of the transaction’. However, the Deputy Judge said that if he was wrong about that, then ‘I would none the less give retrospective permission for these proceedings to be continued. I am satisfied that I have the power to do so.’ (Paragraph 43).
The strong indications are therefore that the Court has jurisdiction to regularise s.423 proceedings through granting leave, during the currency of s.423 proceedings. But the question remains to be definitively answered.
It is noteworthy that the ability of the Court to grant retrospective leave under s.424(1) is consistent with the law in respect to s.285(3) of the Insolvency Act 1986. Section 285(3) reads:
‘After the making of a bankruptcy order no person who is a creditor of the bankrupt in respect of a debt provable in the bankruptcy shall –
(a) have any remedy against the property or person of the bankrupt in respect of that debt, or
(b) before the discharge of the bankrupt, commence any action or other legal proceedings against the bankrupt except with the leave of the court and on such terms as the court may impose.'
The ability of the Court to grant retrospective leave under s.285(3) was confirmed in Breytenbach, at paragraph 25, a decision of Registrar Baister.
Office-Holders Option for Adoption/Abandon, Joinder and Sole Conduct
There can only be 1 set of proceedings under s.423 in respect of any transaction. In Lemos, ICCJ Barber seemingly confirmed this, at paragraph 72:
'I acknowledge the guidance given in Muir Hunter on Personal Insolvency at 3-2959, which provides:
'Under this subsection, [s424(2)], any application for an order under s.423 is to be treated as made on behalf of every victim of the transaction. It follows, ... that only one application under s.423 can be made in respect of any transaction...'
This raises an issue where a 'victim of a transaction' has already commenced s.423 proceedings (with permission) and a trustee(s) in bankruptcy wishes to pursue proceedings to impugn the transaction.
The deputy High Court Judge in Godfrey highlighted options available to the relevant office-holders in Godfrey circumstances. The deputy High Court Judge found, at paragraph 40, that:
‘The person in charge of the insolvent entity’s affairs, and possessed of that entity’s property and assets, can decide whether to adopt the proceedings for the benefit of the creditors as a whole or to abandon them.’
In Lemos, ICCJ Barber heard an application for joinder made by joint trustees in bankruptcy ('JTBs') to existing s.423 proceedings, pursuant to CPR r.19.2 The original s.423 applicant consented to the application (as she was contractually required to do, pursuant to earlier agreement between JTBs and the original s.423 applicant). The Third Defendant, the bankrupt's wife, resisted joinder.
ICCJ Barber acceded to the application and joined the JTBs as co-claimants. Furthermore, though not contractually required to, the original s.423 applicant/claimant was content for a direction to be given that the JTBs should have sole conduct of the proceedings. In light of this, ICCJ Barber also directed that '...from the date of their joinder until further order, the JTBs should have sole conduct of the s.423 claim' (paragraph 1). In essence therefore, the original s.423 applicant/claimant, though remaining an applicant/claimant, gave up control of the s.423 claim to the JTBs.
SIMON HILL © 2020-2021
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NOTICE: This article is provided free of charge for information purposes only; it does not constitute legal advice and should not be relied on as such. No responsibility for the accuracy and/or correctness of the information and commentary set out in the article, or for any consequences of relying on it, is assumed or accepted by any member of Chambers or by Chambers as a whole.
 Section 423(5) of the Insolvency Act 1986, which defines 'a victim of a transaction' as a person "who is, or is capable of being, prejudiced by it" is intended to apply to a wider category than simply creditors. The correct approach in any given case is to ask whether, on the facts of the case, the claimant was a person who was, or was capable of being, prejudiced by the impugned transaction. On the concept of 'victim' being much wider than creditor, see Clydesdale v Smailes  EWHC 3190;  BPIR 77.
In Ali v Bashir  EWHC 3853 (Ch), the s.423 applicant (claimant) was a judgment creditor on a costs order, and the debtor/transferor (first defendant), was the applicant's judgment debtor. At paragraph 12, HHJ Pelling QC (sitting as a Judge of the High Court) said:
'The first defendant was ordered to pay the claimant's costs of the proceedings. The amount payable was established by a default costs certificate dated 30 September 2013 in the sum of £172,860.84. These proceedings are concerned with the enforcement of that costs award.'
Later, at paragraph 36, HHJ Pelling QC recorded 'There is no dispute that the claimant is a victim for the purpose of section 423.'
For examples and discussion of categories of ‘victims of a transaction’ see Moon v Franklin  B.P.I.R. 196; Re Ayala Holdings Ltd  B.C.L.C. 256 (creditor of an insolvent estate; leave hearing - leading to substantive s.423 hearing: National Bank of Kuwait v Menzies  B.C.C. 119) and New Media Distribution Co Sezc Ltd v Kagalovsky  EWHC 2876 (Ch). Also, consider Pinewood Joinery v Starelm Properties Ltd  B.C.C. 569.
[2a] The debtor/transferor is the party that did have the asset/property, but who transferred (assigned/conveyed/gifted/sold etc) it to a transferee/3rd party. Section 424(1) of the Insolvency Act 1986 just refers to this person as the debtor and this article will adopt that simple label also.
[2b] In Re Simon Carves  EWHC 685, Sir William Blackburne said, paragraph 27 ‘The court has a discretion in the matter'. In Bank of Scotland Plc (t/a Birmingham Midshires) v Breytenbach  B.P.I.R. 1, Registrar Baister said, of leave under s.285(3) of the Insolvency Act 1986, at paragraph 26: ‘Granting leave involves the exercise of a discretion.’
 The important thing to appreciate is that s.424(1)(a) is engaged and applicable ‘where the debtor has been made bankrupt’ i.e from the moment the bankruptcy order is made. As is made clear by the wording of s.287(1) of the Insolvency Act 1986, from the moment the bankruptcy order is made, there is a bankrupt estate. And the official receiver is the receiver and manager (subject to section 370 special mangers) of the bankrupt estate from the moment it is formed. This is all to be distinguished from the (potentially later) moment when the bankrupt estate vests in the trustee in bankruptcy (who may be a private insolvency practitioner or the official receiver acting in a different role) under section 306(1) of the Insolvency Act 1986.
To set out some of these sections:
Section 287 of the Insolvency Act 1986 is entitled ‘Receivership pending appointment of trustee’ and s.287(1) reads:
‘Between the making of bankruptcy order and the time at which the bankrupt’s estate vests in a trustee under Chapter IV of this Part, the official receiver is the receiver and subject to section 370 (special manager) the manager of the bankrupt’s estate and is under a duty to act as such.’
See further Dadourian Group International Limited v Simms  EWHC 723 (ch).
Section 306 is entitled ‘Vesting of bankrupt’s estate in trustee’ and section 306(1) reads:
‘The bankrupt’s estate shall vest in the trustee immediately on his appointment taking effect or, in the case of the official receiver, on his becoming trustee.’
On the Official Receivers role, see Part XIV of the Insolvency Act 1986.
Note, a trustee in bankruptcy can be appointed when a bankruptcy order is made under s.297 ‘Special Cases’. The result being in such circumstances that s.287 does not apply.
 Strictly speaking, the official receiver may be a receiver and manager over the bankrupt estate, until a trustee in bankruptcy is appointed, which may be a private insolvency practitioner or may be the official receiver (undertaking the different role). See Section 287(1) of the Insolvency Act 1986 and Dadourian Group International Limited v Simms  EWHC 723 (ch).
[5a] In Dora v Simper  Lexis Citation 2146, at a permission to appeal hearing, Morritt LJ referred, at page 3, to Buckley J at first instance reasoning: ‘whereas under s.423, the claim is in the nature of a class action.’
[5b] In Pinewood Joinery v Starelm Properties Ltd  B.C.C. 569 (1994), His Honour Judge Moseley QC (sitting as a High Court judge) said, at 570:
'The purpose and effect of s. 423 is to enable a person who is a victim of a transaction defrauding creditors to have it set aside. Under the section the court has a discretion as to whether or not it will set aside the transaction and there has been brought to my attention a decision of Mervyn Davies J, Moon v Franklin (reported, so far as I know, only in the Independent of 22 June 1990), in which he exercised that discretion by making a declaration rather than setting aside the transaction.'
[5c] Here the author ventures to suggest that the law may have taken a wrong turn. In the author's view, it is logical that the leave test contains a merits based threshold, with the threshold for permission to bring s.423 proceedings being set at whether the would-be applicant has a ‘realistic prospect of establishing’ the substantive merits of the proposed s.423 application. This may also apply to whether or not the would-be applicant is 'a victim of the transaction' - though it might be said that standing to apply ought to be dealt with as a preliminary issue if possible.
However, with respect, it does not seem quite so logical for the question of whether or not the would-be applicant has a good reason for being permitted to pursue the proposed s.423 application, notwithstanding the office-holder having declined, to also be only to the threshold of ‘realistic prospect of establishing’. Whether the would-be applicant has a good reason to commence and steer a s.423 application, ought simply to be finally determined, on the balance of probabilities, at the leave stage (rather than merely that there is a ‘realistic prospect of establishing’ that the would-be applicant has a good reason to pursue such an application). If leave is granted, the substantive hearing will be on the substantive ingredients making up the s.423 application. It seems rather late in the process to be considering also whether there exists of a good reason for the (then) applicant to pursue the application. It would seem more logical to have the issue of good reason determined at the earlist stage.
When one considers the relevant passage:
'The applicant must demonstrate that he has a realistic prospect of establishing, first, that the transaction in question comes within the scope of section 423 and he is a victim of the transaction and, second, that there is good reason why he should bring the proceedings even though the liquidator or administrator does not.'
It is respectfully suggested that the test would have been better formulated if the word 'first' in the above passage had come after the word 'demonstrate' in the first line. It is suggested that some reformulation/refinement in this area would be beneficial. To be clear though that, until any such reformulation/refinement, the law is as set down by Sir William Blackburne in Re Simon Carves Ltd (in liquidation)  EWHC 685.
 In National Bank of Kuwait SAK v Menzies  B.C.C. 119 (1993), Sir Christopher Slade similarly said, at 126: 'It follows that in my judgment [the applicant for leave]’s proposed application under s. 423 would fail in limine because the primary requirement of subs. (1) could not be satisfied.’
 The relevant insolvency regimes are: (1) bankruptcy for an individual; and (2) liquidation or administration for a company (body corporate).
 In Dora v Simpler  Lexis Citation 2600, Buckley J listed matters which were not addressed in the plaintiff (claimant)’s affidavit, nor explained orally, to Jacob J (who was the judge on the earlier hearing) as:
'(iii) Leave is required for an application under s.423 (s.424(1)(a)). It had not been granted. The proceedings commenced were therefore irregular in so far as they included the s.423 claim;’
The alternative to the proceedings being irregular would have been for the proceedings to have been a nullity. See Seal v Chief Constable of South Wales  UKHL 31,  1 W.L.R. 1910,  7 WLUK 70 and Bristol and West Building Society v Saunders  Ch. 60;  B.C.C. 83. Whether proceedings without leave are irregular or a nullity turns on the particular legislative and case law history. A (perhaps) unique instance where proceedings issued without leave are a nullity, are proceedings issued under section 139 of the Mental Health Act 1983 - see Seal v Chief Constable of South Wales  UKHL 31,  1 W.L.R. 1910,  7 WLUK 70 and Bank of Scotland Plc (t/a Birmingham Midshires) v Breytenbach  B.P.I.R. 1, where Registrar Baister said, at paragraphs 23 'A need to invalidate such proceedings unless leave is first obtained is undoubtedly exceptional and may be unique.’ and 25 ‘the decision in Seal …is unique in holding proceedings issued without leave as a nullity’
 In Dora v Simpler  Lexis Citation 2600, Buckley J also considered an application to discharge an ex parte (without notice) application world-wide Mareva injunction granted on the Plaintiff's application, in respect of assets of the Defendants. Grounds included non-disclosure of material facts by the Plaintiff when making the without notice application.
 For completeness, it is noted that Buckley J did not accede to the application to strike out the whole statement of case.
 In Godfrey v Torpy (No.2)  EWHC 919 (Ch), Peter Leaver QC sitting as a deputy High Court judge said, at paragraphs 39 and 40, that the wording of s.424(1):
‘…demonstrates that a victim needs the leave of the court after the debtor’s insolvency, but that such leave is not required before the debtor’s insolvency...
What is the position when, as in the present case, proceedings have been commenced, inter alia, for relief under section 423 and the individual or company against whom the claim is made is thereafter adjudicated bankrupt or becomes insolvent or goes into administration or enters into a voluntary arrangement? In my judgment, the answer, so far as concerns an individual, is that unless an application for a stay is made pursuant to section 285, the proceedings can continue.'
The Deputy Judge reasoned, at paragraph 39:
‘If Parliament had intended the position to be that, unless an application for leave to continue were made, proceedings in which relief was sought under section 423 of the Act would automatically be stayed if the party against whom relief was claimed was adjudged bankrupt or was in the process of being wound up or in administration or bound by a voluntary arrangement, it would have clearly stated that to be the position.'
 It is unclear how far an analogy should be drawn between the leave provisions in s.285(3) and s.424(1). Section 285(3) relates to the would-be claimant commencing an action/other legal proceedings, which would seem to be on their own cause of action, whereas s.424(1) relates to commencing/steering a s.423 application for relief restoring/replenishing value back into the debtor’s insolvent estate, a class remedy/action for the benefit of the insolvent estate/general body of creditors to the insolvent estate.
In Dora v Simper  Lexis Citation 2600, Buckley J recorded similar arguments on the distinction, towards the end of his judgment:
'[Counsel for the Defendants'] submission was that an application for leave pursuant to s.424 could be distinguished from other requirements for leave, eg. Section 285, considered by Lindsay J in In re Saunders (a Bankrupt)  Ch 60,  3 All ER 992 on the ground that under s.423/4 the Court is concerned with the augmentation of the estate as opposed to judging whether an action which would diminish it should be permitted and that prejudice could be caused to the liquidator by the irregular commencement of proceedings.'
Uncertainty as to how far an analogy can be drawn, limits what, if any assistance, can be obtained from: (1) Bristol & West Building Society v The Trustee of the Property of Back and Another (bankrupts)  1 BCLC 486, where David Young QC sitting as a Deputy High Court Judge set down 7 matters to be taken into account; and (2) Registrar Baister’s adoption of David Young QC’s 7 matters, and application of them, in Bank of Scotland Plc (t/a Birmingham Midshires) v Breytenbach  B.P.I.R. 1, from paragraphs 26 to 34.