The Debtor failed to make the payments. As such, the Petitioner served a statutory demand followed by a bankruptcy petition, it then withdrew that petition and was ordered to pay the Debtor’s costs, and finally it served a second bankruptcy petition in which it set-off the amount of the costs award against the judgment debt.
Despite the Debtor’s objections on the grounds, the Court made a bankruptcy order and held that:
- The Petitioner had complied with its obligations under the settlement agreement.
- It would “manifestly unjust” to require the Petitioner to pay the costs award when the Debtor continue to be in breach of the order to pay the underlying debt.
- The petition, which attempted to recover interest from the date of the statutory demand, could be cured of this defect as it caused no detriment to the Debtor.
- The Debtor had not satisfied any of the criteria to evidence that he had a reasonable prospect of paying the petition debt in full.
Moorgate Industries UK Ltd v Pramod Mittal (2020)