The Supreme Court has refused a debtor permission to appeal against a bankruptcy order in the case of Howell v Hughes & Hughes.
Mr and Mrs Hughes had granted a tenancy of a house to Mr Howell. He did not pay all of the rent and so they issued possession proceedings. In September 2015 a possession order and money judgment were made against him. He did not satisfy the judgment debt and a bankruptcy petition was presented.
After dismissing various objections to the petition, including an argument that the creditors had unreasonably refused to accept an offer so that the petition should be dismissed under Insolvency Act 1986, s.271(3), an Insolvency and Companies Court Judge adjourned the petition to allow the debtor to put in place an arrangement whereby he instructed the executors of an estate that he was a beneficiary of to pay his share of the proceeds of the estate to the petitioning creditors. The ICC Judge adjourned the petition for three months to allow the main asset in the estate, a house, to be sold.
At the next hearing, it was apparent that the sale of the house and final distribution of the estate was still some way off, and that Mr Howell’s share of the likely value of the estate was going to leave a significant shortfall of at least £10,000. He made an offer to pay £10,000 and then during the hearing said “if someone thought it ought to be more than £10,000 then I would go along with that but at the moment it seems to me that £10,000 would be more than adequate.”
ICC Judge Burton held that the creditors had been entitled to refuse the debtor’s offer and made a bankruptcy order.
Mr Howell applied to stay the bankruptcy order but this was refused:  EWHC 1559 (Ch);  BPIR 1211. He then appealed to the High Court against the bankruptcy order. That appeal was dismissed by Birss J:  EWHC 747 (Ch). The Judge held that there had not been a concrete offer to pay more than £10,000 and the ICC Judge had been entitled to consider that this offer was insufficient.
Mr Howell was granted permission to bring a second appeal on the ground that the High Court should have considered his offer to have been more than £10,000. The Court of Appeal (The Master of the Rolls, Lewison LJ, and Coulson LJ) dismissed that appeal:  EWCA Civ 1431;  BPIR 135. The Court of Appeal held that where an uncertain amount of a debt was subject to a form of security an offer to pay an unspecified amount towards the remainder of the debt was too uncertain to be accepted by the petitioning creditors.
Mr Howell sought permission to appeal to the Supreme Court and an extension of time for bringing that appeal. The Supreme Court (Lord Hodge, Lord Sales, and Lady Rose), refused the application for an extension of time and refused the application for permission to appeal as it raised no arguable point of law and no point of general public importance.
Robert Brown represented the successful respondents in the Court of Appeal and drafted their grounds of opposition for the Supreme Court, instructed by Clifford Tibber of Anthony Gold.