Muddy Litigation

Muddy Litigation

Muddy Litigation and apparently pejorative mudslinging did not assist the applicant in Moulds Fencing (Torksey) Ltd & Ors v Butler & Ors [2020] EWHC 2933 (Ch).

According to the Court it appeared to it as though the “mud” throwing attempts were deemed little more than Mr Moulds’ assertion and were without foundation.

The case seems to have been about complaints concerning some company Administrators. The Court did not seem impressed with the application.

In the end the Administrators were granted approval to make a distribution and the creditors’ application did not succeed.

The Court had this to say about the way the creditors’ application was brought:

It is not helpful for Mr Mould’s evidence (which has obviously been professionally prepared and which contains little evidence but a great deal of submission) to spend time and ink on trying to undermine Mr Butler’s evidence in this manner when cross-examination was not proposed (and was clearly not appropriate).

On the evidence as it is before me, I also reject Mr Moulds’ suggestions that the Administrators took undue time in reaching the conclusions that they say that they reached, or in formulating and putting forward the Proposals that they did. Mr Mould impliedly suggests, at the best, incompetence and, at the worst, something more, in saying that:
“16. … It is not clear why the Proposals were only filed on 21 July 2020, over two months after the Joint Administrators were appointed in respect of the Company, with which they had been familiar since March 2020.”

I do not accept this implicit criticism at all, nor the hypothesis upon which it is based. As regards the hypothesis on which the allegation is based, there were no grounds to assume that the Administrators had been “familiar” with the Company since March to a depth that meant they should have produced their Proposals much earlier. Indeed, inter-solicitor correspondence had revealed that the Administrators had, with the benefit of specialist advice, investigated the position and that expectations had changed and new facts come to light. I am not satisfied that this was a situation where the Administrators had failed to put forward their Proposals as soon as reasonably practicable after the Company first entered into administration: see paragraph 49(5)(a) Schedule B1. This is one of a number of pejorative comments which have no basis and, in any event, the relevance of which are wholly unclear, other than as some form of “mudslinging”. Mr Mould’s position in this respect amounts to little more than assertion and could only be established (if at all) following cross-examination or the provision of far more material than I have before me. I deal separately below with the legal analysis carried out by the Administrators. As regards timing, I accept that the administration and its management has been affected by the Covid-19 pandemic as detailed by Mr Butler in his evidence and set out by the Administrators’ solicitors in correspondence.