Vol 16 (2019) - Issue 3

Article preview

Lehman Brothers Australia Limited (in liquidation) v Anthony Victor Lomas, Steven Anthony Pearson, Russell Downs, Julian Guy Parr (The Joint Administrators of Lehman Brothers International (Europe) (in administration)) [2018] EWHC 2783 (Ch), 24 October 20

Synopsis

In this case Hildyard J held that neither the rule in Ex Parte James (1873-74) LR 9 Ch App 609 nor paragraph 74 of Schedule B1 of the Insolvency Act 1986 justified the Court interfering in a contract which had been freely entered into by the parties. This was so even where both parties agreed that there had been a mistake in the calculation of the sum owed by the respondent, Lehman Brothers International (Europe), to the applicant, Lehman Brothers Australia. The jurisdiction conferred by the rule in Ex Parte James was limited to circumstances in which it would be unconscionable for officeholders to uphold their legal rights, and relief under paragraph 74 of Schedule B1 was restricted to situations in which officeholders proposed to act in a discriminatory manner between creditors. Since neither applied in the instant case, the application was dismissed.