| Siebe Gorman & Co Ltd v Barclays Bank Ltd | |
|---|---|
 A Siebe Gorman rebreather. | |
| Court | High Court of Justice |
| Citation(s) | [1979] 2 Lloyd’s Rep 142 |
| Court membership | |
| Judge(s) sitting | Slade J |
| Keywords | |
| Floating charge | |
Siebe Gorman & Co Ltd v Barclays Bank Ltd [1979] 2 Lloyd's Rep 142 is a UK insolvency law case, concerning the definition of a floating charge. It was an influential decision for many years, but is now outdated as authority in light of the House of Lords decision in Re Spectrum Plus Ltd .
Siebe Gorman, a diving equipment company, granted a debenture in favour of Barclays Bank to secure a loan. The document was expressed to create a ‘first fixed charge’ over all present and future book debts. It required Siebe Gorman to pay the proceeds of its book debts into a Barclays Bank account, and prohibited Siebe Gorman from creating any other charges on those book debts, or assigning the book debts to anyone else. So there was a prohibition on dealing with the book debts before collection of them. Barclays also had the right to obtain absolute control by giving notice, but that right was never exercised.
Slade J held that it was a fixed charge. The restrictions on Siebe Gorman's power gave the bank enough control to be inconsistent with being a floating charge.
Although the case remained good law for many years, it was doubted by the Privy Council in Re Brumark Investments Ltd [2001] UKPC 28, and then formally overruled by the House of Lords in Re Spectrum Plus Ltd [2005] UKHL 41.
Liquidation is the process in accounting by which a company is brought to an end in Canada, United Kingdom, United States, Ireland, Australia, New Zealand, Italy, and many other countries. The assets and property of the company are redistributed. Liquidation is also sometimes referred to as winding-up or dissolution, although dissolution technically refers to the last stage of liquidation. The process of liquidation also arises when customs, an authority or agency in a country responsible for collecting and safeguarding customs duties, determines the final computation or ascertainment of the duties or drawback accruing on an entry.
Siebe Gorman & Company Ltd was a British company that developed diving equipment and breathing equipment and worked on commercial diving and marine salvage projects. The company advertised itself as 'Submarine Engineers'. It was founded by Augustus Siebe, a German-born British engineer chiefly known for his contributions to diving equipment.
In finance, a floating charge is a security interest over a fund of changing assets of a company or other legal person. Unlike a fixed charge, which is created over ascertained and definite property, a floating charge is created over property of an ambulatory and shifting nature, such as receivables and stock.
Salomon v A Salomon & Co Ltd[1896] UKHL 1, [1897] AC 22 is a landmark UK company law case. The effect of the House of Lords' unanimous ruling was to uphold firmly the doctrine of corporate personality, as set out in the Companies Act 1862, so that creditors of an insolvent company could not sue the company's shareholders for payment of outstanding debts.
Re Spectrum Plus Ltd[2005] UKHL 41 was a UK company law decision of House of Lords that settled a number of outstanding legal issues relating to floating charges and recharacterisation risk under the English common law. However, the House of Lords also discussed the power of the court to make rulings as to the law that were "prospective only" to mitigate potential harshness when issuing a ruling that was different from what the law had previously been understood to be.
United Kingdom insolvency law regulates companies in the United Kingdom which are unable to repay their debts. While UK bankruptcy law concerns the rules for natural persons, the term insolvency is generally used for companies formed under the Companies Act 2006. Insolvency means being unable to pay debts. Since the Cork Report of 1982, the modern policy of UK insolvency law has been to attempt to rescue a company that is in difficulty, to minimise losses and fairly distribute the burdens between the community, employees, creditors and other stakeholders that result from enterprise failure. If a company cannot be saved it is liquidated, meaning that the assets are sold off to repay creditors according to their priority. The main sources of law include the Insolvency Act 1986, the Insolvency Rules 1986, the Company Directors Disqualification Act 1986, the Employment Rights Act 1996 Part XII, the EU Insolvency Regulation, and case law. Numerous other Acts, statutory instruments and cases relating to labour, banking, property and conflicts of laws also shape the subject.
Agnew v Commissioners of Inland Revenue, more commonly referred to as Re Brumark Investments Ltd[2001] UKPC 28 is a decision of the Privy Council relating to New Zealand and UK insolvency law, concerning the taking of a security interest over a company's assets, the proper characterisation of a floating charge, and the priority of creditors in a company winding-up.
Re Bank of Credit and Commerce International SA [1998] AC 214 is a UK insolvency law case, concerning the taking of a security interest over a company's assets and priority of creditors in a company winding up.
Illingworth v Houldsworth [1904] AC 355 is a UK insolvency law case, concerning the taking of a security interest over a company's assets with a floating charge. In the Court of Appeal Romer LJ held that a key to a floating charge, as opposed to a fixed charge was that the company can carry on its business with assets subject to the charge.
Re Yeovil Glove Co Ltd [1965] Ch 148 is a leading UK insolvency law case, concerning voidable floating charges for past value. It holds that a floating charge can harden when it secures a debt in an overdraft account, when the bank keeps the facility open as a company takes money out and puts money in.
Re New Bullas Trading Ltd [1994] 1 BCLC 485 is a UK insolvency law case, concerning the definition of a floating charge. It held, somewhat controversially, that it was possible to separate a book debt from its proceeds, and that it was possible to create a fixed charge over the book debt but only a floating charge over the proceeds. At the time the decision attracted a great deal of academic commentary, much of it hostile.
The Preferential Payments in Bankruptcy Amendment Act 1897 was an Act of Parliament of the United Kingdom, affecting UK insolvency law. It amended the category of "preferential payments" for rates, taxes and wages, to take priority over a floating charge in an insolvent company's assets. The Act was passed in broad response to the decision of the House of Lords in Salomon v A Salomon & Co Ltd[1896] UKHL 1, [1897] AC 22.
Buchler v Talbot[2004] UKHL 9 is a UK insolvency law case, concerning the priority of claims in a liquidation. Under English law at the time the expenses of liquidation took priority over the preferred creditors, and the preferred creditors took priority over the claims of the holder of a floating charge. However, a crystallised floating charge theoretically took priority over the liquidation expenses. Accordingly the courts had to try and reconcile the apparent triangular conflict between priorities.
Re Brightlife Ltd [1987] 1 Ch 200 is a UK insolvency law case, concerning the conversion of a floating charge 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 Insolvency Act 1986 section 251, which said a floating charge was one that was created as a floating charge.
Barclays Bank Ltd v W J Simms, Son and Cooke (Southern) Ltd [1980] 1 QB 677, [1979] 3 All ER 522 was a decision of the High Court of Justice relating to the recovery of a payment mistakenly made by a bank after the customer had countermanded the cheque.
Royal Trust Bank v National Westminster Bank plc [1996] BCC 613 was a decision of the Court of Appeal in relation to the nature of a floating charge.
Re MC Bacon Ltd [1991] Ch 127 is a UK insolvency law case relating specifically to the recovery the legal costs of the liquidator in relation to an application to set aside a floating charge as an unfair preference.
Re Nanwa Gold Mines Ltd [1955] 1 WLR 880 was a trust law decision relating to subscription monies for shares and what would subsequently come to be known as Quistclose trusts. The court held that where subscription monies had been paid over to enable the company to accomplish a specific purpose, if that purpose failed then the money was held on trust for the subscribers and did not form part of the assets of the company. Even though the decision was only a first-instance ex tempore decision, it has been repeatedly upheld, including by the House of Lords in Barclays Bank Ltd v Quistclose Investments Ltd[1968] UKHL 4
Re Peachdart Ltd [1984] Ch 131 is a judicial decision relating to retention of title clauses, and the extent to which the vendor of a raw material can seek to assert title to goods into which those raw materials are subsequently worked. The court held that seeking to assert title to the subsequently worked goods had the effect of creating an equitable charge, which was void for non-registration under the Companies Act.
Barclays Bank plc v Quincecare Ltd [1992] 4 All ER 363 is a judicial decision of High Court of Justice of England and Wales in relation to the banker-customer relationship, and in particular in connection with the bank's duties in relation to payment instructions from a customer's agent or purported agent which give rise, or ought to give rise, to a suspicion of fraud.