130:
229:, its bank. The charge said it was a "first specific charge" and did not allow Brightlife to sell, factor or discount debts without written consent. A debenture holder gave the company a notice converting the floating charge into a fixed charge a week before a voluntary winding up resolution was passed. Counsel argued public policy required restriction on crystallising events, one reason being that an automatic crystallisation clause could take effect without knowledge of company or debenture holder. It could be prejudicial to a third party, because it does not get registered. Counsel referred to the Canadian case
24:
465:‘significant feature is that Brightlife was free to collect its debts and pay the proceeds into its bank account. Once in the account, they would be outside the charge over debts and at the free disposal of the company. In my judgment a right to deal in this way with the charged assets for its own account is a badge of a floating charge and is inconsistent with a fixed charge.
461:
that there was a floating charge if a company can continue to use book debts without the consent of the chargee. He added that although clause 3(A)(ii)(a) referred to a ‘first specific charge’ over book debts and others, ‘the rights over the debts created by the debenture were in my judgment such as to be categorised in law as a floating charge.'
470:
I do not think that it is open to the courts to restrict the contractual freedom of parties to a floating charge on such grounds. The floating charge was invented by
Victorian lawyers to enable manufacturing and trading companies to raise loan capital on debentures… without inhibiting its ability to
460:
crystallisation clauses were a necessary incident of parties’ freedom to contract and policy objections should be dealt with by
Parliament. He noted various statutory already, including priority to preferential debts. And certainly he at first instance was not going to add to the list. It followed
476:
The public interest requires a balancing of the advantages to the economy of facilitating the borrowing of money against the possibility of injustice to unsecured creditors… arguments for and against the floating charge are matters for
Parliament rather than the
208:
into a fixed charge ("crystallisation"). It held that an automatic crystallisation clause was part of the parties’ freedom of contract. It could not be limited by court created public policy exceptions. The significance of the case was largely outpaced by the
281:
321:
369:
264:
333:
564:
454:
held that in reality, the charge on book debts was a floating charge, but had crystallised a week before, and so took priority over other debts. Following
487:
491:
129:
257:
504:(at paragraph 87) in relation to the recharacterisation of a charge described as a fixed charge over book debts as a floating charge.
41:
107:
451:
163:
231:
88:
295:
60:
250:
45:
67:
381:
74:
34:
357:
307:
456:
56:
140:
496:
396:
210:
81:
513:
441:
226:
201:
437:
214:
205:
181:
427:
414:
558:
501:
401:
386:
23:
235:, where Berger J rejected the concept of a "self generating crystallisation".
242:
246:
17:
225:
Brightlife Ltd had a charge over book debts in favour of
169:
159:
154:
146:
136:
122:
48:. Unsourced material may be challenged and removed.
463:
217:was one that was created as a floating charge.
258:
8:
283:Re Panama, NZ & Australian Royal Mail Co
265:
251:
243:
232:R v Consolidated Churchill Copper Corp Ltd
128:
119:
108:Learn how and when to remove this message
309:Re Yorkshire Woolcombers Association Ltd
524:
334:Siebe Gorman & Co v Barclays Bank
204:case, concerning the conversion of a
7:
322:Aluminium BV v Romalpa Aluminium Ltd
46:adding citations to reliable sources
565:United Kingdom insolvency case law
14:
428:[2011] EWHC 1948 (Ch)
415:[2007] EWHC 1443 (Ch)
411:Russell Cooke Trust Co v Elliott
296:Salomon v A Salomon & Co Ltd
22:
370:Royal Trust Bank v NatWest Bank
33:needs additional citations for
1:
581:
486:The case was cited by the
382:Re Brumark Investments Ltd
213:section 251, which said a
457:Re Manurewa Transport Ltd
434:
421:
408:
393:
378:
366:
358:Re New Bullas Trading Ltd
354:
342:
330:
318:
304:
292:
278:
273:Cases on floating charges
174:
127:
502:[2005] UKHL 41
479:
402:[2005] UKHL 41
387:[2001] UKPC 28
497:Re Spectrum Plus Ltd
424:Re Rayford Homes Ltd
397:Re Spectrum Plus Ltd
42:improve this article
287:(1870) 5 Ch App 318
211:Insolvency Act 1986
57:"Re Brightlife Ltd"
186:Recharacterisation
514:UK insolvency law
490:with approval by
448:
447:
442:UK insolvency law
346:Re Brightlife Ltd
337:2 Lloyd’s Rep 142
202:UK insolvency law
197:Re Brightlife Ltd
193:
192:
123:Re Brightlife Ltd
118:
117:
110:
92:
572:
541:
538:
532:
529:
438:Floating charges
310:
284:
267:
260:
253:
244:
155:Court membership
132:
120:
113:
106:
102:
99:
93:
91:
50:
26:
18:
580:
579:
575:
574:
573:
571:
570:
569:
555:
554:
549:
544:
539:
535:
530:
526:
522:
510:
484:
449:
444:
430:
417:
404:
389:
374:
362:
350:
338:
326:
314:
308:
300:
288:
282:
274:
271:
241:
223:
215:floating charge
206:floating charge
189:
182:Floating charge
114:
103:
97:
94:
51:
49:
39:
27:
12:
11:
5:
578:
576:
568:
567:
557:
556:
553:
552:
548:
545:
543:
542:
533:
523:
521:
518:
517:
516:
509:
506:
488:House of Lords
483:
480:
446:
445:
435:
432:
431:
422:
419:
418:
409:
406:
405:
394:
391:
390:
379:
376:
375:
367:
364:
363:
355:
352:
351:
343:
340:
339:
331:
328:
327:
319:
316:
315:
305:
302:
301:
293:
290:
289:
279:
276:
275:
272:
270:
269:
262:
255:
247:
240:
237:
222:
219:
200:1 Ch 200 is a
191:
190:
188:
187:
184:
179:
175:
172:
171:
167:
166:
161:
157:
156:
152:
151:
148:
144:
143:
138:
134:
133:
125:
124:
116:
115:
30:
28:
21:
13:
10:
9:
6:
4:
3:
2:
577:
566:
563:
562:
560:
551:
550:
546:
537:
534:
528:
525:
519:
515:
512:
511:
507:
505:
503:
499:
498:
493:
489:
481:
478:
474:
472:
468:
466:
462:
459:
458:
453:
443:
439:
433:
429:
425:
420:
416:
412:
407:
403:
399:
398:
392:
388:
384:
383:
377:
372:
371:
365:
360:
359:
353:
348:
347:
341:
336:
335:
329:
324:
323:
317:
312:
311:
303:
298:
297:
291:
286:
285:
277:
268:
263:
261:
256:
254:
249:
248:
245:
238:
236:
234:
233:
228:
220:
218:
216:
212:
207:
203:
199:
198:
185:
183:
180:
177:
176:
173:
168:
165:
162:
160:Judge sitting
158:
153:
149:
145:
142:
139:
135:
131:
126:
121:
112:
109:
101:
98:February 2017
90:
87:
83:
80:
76:
73:
69:
66:
62:
59: –
58:
54:
53:Find sources:
47:
43:
37:
36:
31:This article
29:
25:
20:
19:
16:
536:
527:
495:
485:
475:
473:
469:
467:
464:
455:
450:
423:
410:
395:
380:
368:
356:
345:
344:
332:
320:
306:
294:
280:
230:
224:
196:
195:
194:
104:
95:
85:
78:
71:
64:
52:
40:Please help
35:verification
32:
15:
547:References
492:Lord Scott
452:Hoffmann J
361:1 BCLC 485
178:Insolvency
164:Hoffmann J
141:High Court
68:newspapers
531:5 WWR 652
482:Authority
325:1 WLR 676
559:Category
540:NZLR 909
508:See also
349:1 Ch 200
313:2 Ch 284
239:Judgment
227:Norandex
170:Keywords
147:Citation
477:courts.
471:trade.
373:BCC 316
82:scholar
150:Ch 200
84:
77:
70:
63:
55:
520:Notes
500:
426:
413:
400:
385:
299:AC 22
221:Facts
137:Court
89:JSTOR
75:books
436:see
61:news
494:in
440:in
44:by
561::
266:e
259:t
252:v
111:)
105:(
100:)
96:(
86:·
79:·
72:·
65:·
38:.
Text is available under the Creative Commons Attribution-ShareAlike License. Additional terms may apply.
