Swift v Ahmed: transactions defrauding creditors

The Hon. Mr Justice Norris, Vice-Chancellor of the County Palatine, handed down a reserved judgment on 17th November in Swift Advances Plc v Ahmed [2015] EWHC 3265 (Ch). Josephine Hayes appeared on behalf of the successful Applicant, Swift Advances Plc. This was an application made under section 423 of the Insolvency Act 1986 (transactions defrauding creditors).

The High Court set aside two trust deeds on which the Respondents sought to rely to defeat Swift’s concurrent claims as mortgagee for possession of two properties. The two deeds were transactions at an undervalue, and the issue was whether Mr Ahmed had entered into the deeds for the purpose of putting assets beyond the reach (or otherwise prejudicing the interests) of someone who might at some time make a claim against him. The learned Judge held that he had.

In the course of his judgment Mr Justice Norris also ruled, applying the dictum of Lord Wilberforce in Mulholland v Mitchell [1971] AC 666, that a document which had come to light between the conclusion of the main hearing and the delivery of his reserved judgment should be admitted, because to have refused to admit it would have affronted common sense, or a sense of justice. The learned Judge also considered that the Respondents could not properly object to the document being adduced, in view of the principle stated by Stuart-Smith LJ in Vernon v Bosley (No.2) [1999] QB 18 at 37D that it was the duty of every litigant not to mislead the court, which would occur if, having led the court to believe a fact to be true, he failed to correct it when he discovered it to be false. This duty continued until the judge had given judgment.

Judgment available here: Swift v Ahmed judgment.