Court refuses adjournment request made for personal purposes

The applicants were the joint administrators of London South West SW Limited (the company). The company was incorporated for the development and sale of residential property involving the creation of 26 flats (the property). The company was the lessor of 25 of the flats. The individual flat owners all had sub-leases granted by the company.

The second respondent was incorporated to act as the management company for the property. The first respondent was the sole director of the company and the second respondent.

The administrators were appointed by two creditors of the company. When the company entered administration, there was one remaining flat under offer. The lease for the remaining flat also had to be signed by the second respondent.

Following the appointment of administrators, the first respondent had continually refused to sign the lease on behalf of the second respondent. This was because the two creditors who had appointed the joint administrators had served a bankruptcy petition on the first respondent in respect of a personal guarantee, and the first respondent was attempting to use the lease as leverage in that context.

The joint administrators sought an injunction to compel the first respondent to sign the lease. The first respondent sought two adjournments for personal reasons. The first adjournment was consented to. The second adjournment was refused by the court as:

  1. The first respondent had not put forward any legitimate basis for refusing to sign the lease
  2. The sale process had been delayed for months and there was a significant risk the company would lose the buyers if the matter was adjourned again
  3. A withdrawal by the buyers would cause loss to the insolvent estate as future offers were unlikely to be as much given the company was now in administration

The first respondent was therefore ordered to execute the lease on behalf of the second respondent and to pay the applicant’s costs.

Re London South West SW Ltd (In Administration) [2023] EWHC 1986 (Ch)

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