Trust or loan?

Insolvency Litigation

We acted for a company seeking to set aside a charging order and third party debt order obtained by a trustee in bankruptcy of an individual who established a trust whose fund was used to purchase the property registered in our client’s name. 

The trustee in bankruptcy alleged that funds paid by the bankrupt into a trust structure which were used to purchase the property were not settled on trust, but were instead paid by way of a loan which the trustee was therefore entitled to collect in.  There were various contradictory documents which were created over a period of around 12 years and which involved dissolved companies in various jurisdictions. 

The trustee in bankruptcy’s case relied on default judgment obtained in Gibraltar against a company which had been newly restored to the register for the sole purpose of the litigation to be brought by the trustee in bankruptcy.  That company had no directors and was not, therefore, able to defend those proceedings.  Our client successfully applied to set aside the default judgment in Gibraltar and to be joined into the proceedings.  The third party debt order and charging order were entirely based on the default judgment and could not survive without that judgment.

Insolvency Litigation Case Studies

Insolvency Litigation Case Studies

Challenge to divorce

Sham trusts

Trust or loan?

Challenge to former administrators’ fees

Director’s disqualification

Challenge to statutory demand

Freezing assets

Liquidators’ failure to adjudicate

Section 236 interviews and document requests

Out of court administration (no qualifying floating chargeholder)

Out of court administration (with qualifying floating chargeholder)

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