Conflict liquidators appointed

The High Court considered whether to appoint additional liquidators to TB Realisations Limited (formerly Travelex Bank Notes Limited) following concerns raised by Rawbank S.A., its largest unsecured creditor, regarding potential conflicts and inadequate investigation of claims arising from pre-administration transactions.

Rawbank applied under section 108 of the Insolvency Act 1986 for the appointment of two Grant Thornton partners as additional liquidators. The application followed Travelex Bank Notes Limited’s failure to deliver US$60 million in banknotes ordered in March 2020 and subsequent refusal to refund, leading to summary judgment against the company. The company entered administration in July 2020 and liquidation in August 2023, with PwC partners acting throughout.

Rawbank alleged that PwC’s prior advisory role during the “Pre-Administration Period” (March–July 2020) created an actual or perceived conflict when investigating transactions such as cash sweeps to Travelex Limited and significant payments to another creditor (Creditor A), which appeared to satisfy the statutory requirements for a preference under section 239. Although PwC obtained legal advice from Brown Rudnick and later a review by its own contentious insolvency team, the court found disclosure of these reviews inadequate and noted that the advice summary raised more questions than it answered.

Judge Barber held that the jurisdiction under section 108(1) extends to appointing additional liquidators where conflicts exist and concluded that PwC had effectively “marked its own homework” for six months post-administration. The court determined that there was a strong prima facie case for a preference claim and that potential benefits outweighed any delay, particularly as Rawbank undertook to fund costs and indemnify against adverse orders. Nicholas Nicholson and Robert Starkins of Grant Thornton were appointed as conflict liquidators for an initial 18-month term to investigate potential claims.

Key points:

1. The court has the jurisdiction to appoint additional liquidators pursuant to section 108(1) of where an actual or perceived conflict exists. This includes circumstances where the incumbent officeholders previously advised the company during a critical pre-insolvency period.
2. Where insolvency practitioners have prior involvement, conflicts cannot simply be “managed” belatedly. The judgment emphasises that steps such as obtaining independent legal advice must be timely and properly evidenced. Failure to disclose instructions, underlying documents, and advice summaries undermines confidence in the adequacy of investigations. Conflict management must be immediate and transparent.
3. Although majority creditors’ views carry significant weight, they are not determinative. The court will scrutinise whether those views are commercially rational and independent. Where creditors are associated with former management or have vested interests (eg through assignments or restructuring benefits), their opposition may be discounted.

Rawbank SA v Banfield [2025] EWHC 3054 (Ch) (21 November 2025) (Barber J).