John J Greenwood and Hadley J Chilton and Another v FuturesOne Diversified Fund SPC Ltd and Others

JurisdictionCaribbean States
CourtEastern Caribbean Supreme Court
Judgment Date17 Apr 2013
Docket NumberCLAIM NO: BVIHCM (COM) 2012/0113, 0116, 0114 and 0115

IN THE HIGH COURT OF JUSTICE

IN THE EASTERN CARIBBEAN SUPREME COURT

CLAIM NO: BVIHCM (COM) 2012/0113, 0116, 0114 and 0115

In the matter of FuturesOne Diversified Fund SPC Ltd.

And in the matter of FuturesOne Innovative Fund SPC Ltd.

And in the matter of Phi R (squared) Investment Fund SPC Ltd.

In the matter of Anchor Hedge Fund Limited

And in the matter of The Insolvency Act 2003

(1) John J Greenwood and Hadley J Chilton, as Joint Liquidators of FuturesOne Diversified Fund SPC Ltd, FuturesOne Innovative Fund SPC Ltd, Phi R (squared) Investment Fund SPC Ltd, Anchor Hedge Fund Limited
(2) FuturesOne Diversified Fund SPC Ltd, FuturesOne Innovative Fund SPC Ltd, Phi R (squared) Investment Fund SPC Ltd, Anchor Hedge Fund Limited
Applicants
and
(1) FuturesOne Diversified Fund SPC Ltd.
(2) FuturesOne Innovative Fund SPC Ltd.
(3) Phi R (squared) Investment Fund SPC Ltd.
(4) Anchor Hedge Fund Limited
Respondents

(Joint Liquidators seeking order that Receiver pay Joint Liquidators' costs of proceedings brought to establish validity of their appointments -Receiver not joined as respondent to the proceedings — Receiver making unsuccessful intervention at the hearing — whether Receiver a party for the purposes of CPR 64.10(1)(b) — whether fact that applications had been made in response to conduct of the Receiver casting doubt on the validity of the appointments of itself rendered him liable to indemnify the Joint Liquidators against their costs of the applications — whether Receiver liable to pay increased costs of the hearing attributable to his unsuccessful intervention)

1

Bannister J [Ag]: On 20 March 2013 I gave judgment declaring, on their applications, that the appointments of Mr Hadley Chilton and Mr John Greenwood as Joint Liquidators of the above mentioned companies were valid as made.

2

Those applications had been prompted in substantial part by the stance taken by a Receiver appointed by the United States District Court for the Northern District of Illinois Eastern Division on 27 September 2012 (‘the Receiver’), over certain property comprised within a group of companies owned or controlled by a Mr Battoo. It was the Receiver's contention that the assets of the companies of which Mr Chilton and Mr Greenwood are the Joint Liquidators and which are part of Mr Battoo's former empire, are assets in the US Receivership and there is no doubt that the Receiver has been at pains to sow doubts as to the validity of the Joint Liquidators’ appointments and, thus, as to their ability to deal with those assets. A fuller account of this background is set out in my judgment herein of 20 March 2013.

3

The Joint Liquidators' applications were issued on 20 February 2013 and copies of the papers for the applications were delivered to those acting for the Receiver on the following day. Although the Receiver was asked to communicate what were his intentions with regard to the applications, which were returnable on 7 March 2013, he declined to respond. Instead, it transpired, he set about obtaining reports from experts on foreign law with the intention of deploying them (without having obtained the permission required by CPR 32.6) at the hearing and without notifying the Joint Liquidators that he was doing so. On 5 March 2013 the Receiver filed a cross application for various relief aimed at dismantling the liquidations, including an application to be joined as party to the Joint Liquidators' applications. That was served on the Joint Liquidators on the following day. On 7 March 2013, having applied unsuccessfully for an adjournment, the Receiver played an active part, by Counsel, in arguing that the Joint Liquidators had not been validly appointed and in seeking to have their acts to date set aside or declared invalid. The Receiver's opposition was wholly unsuccessful and I refused his application to be joined as a party to the Joint Liquidators' applications on the grounds that he had no standing to intervene in any of the liquidations in any way.

4

In these circumstances, the Joint Liquidators now ask that the Receiver be ordered to pay all, or at any rate some, of the costs of each of the Joint Liquidators' four applications. It is common ground and the Receiver has very properly accepted that hemust pay the costs of his own failed cross application, and quantum has sensibly been agreed. But the Receiver says that he should not be made liable to pay any of the costs of the Joint Liquidators' applications.

5

Mr Addo, who has appeared for the Receiver on the Joint Liquidators' costs application, submits that I cannot order the Receiver to pay any part of the costs of the Joint Liquidators' applications, because, he submits, he has never been a party to them (indeed, he stresses that I expressly decided that the Receiver has no...

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