Vol 15 (2018) - Issue 2

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No Assets, No Problem: Court of Appeal Upholds Validity of Floating Charge Even in the Absence of Any Assets to which the Charge Could Attach

Introduction

In the recent decision SAW (SW) 2010 Ltd and another v Wilson and others [2017] EWCA Civ 1001, the Court of Appeal considered the validity of the appointment of administrators by the holder of a purported qualifying floating charge which had been granted in breach of the terms of a prior floating charge, thereby triggering crystallisation of the prior charge. The central issue was whether the later floating charge was valid given that, at the time it was created, there were no unencumbered assets to which it could have attached.