Winding-up petition dismissed

The High Court has dismissed a winding-up petition against Binomia Ltd, finding a genuine and substantial dispute over the debt’s enforceability under a parent company guarantee. The judgment offers key reminders on insolvency petition standards.

In Abcor Finance Securities Ltd v Binomia Ltd, Deputy ICC Judge Arumugam dismissed a winding-up petition based on a £305,811.91 debt allegedly arising under a parent company guarantee. The debt related to a trade finance facility and loan agreement between the Petitioner, Abcor and Binomia’s subsidiary, Circular Tech Solutions Limited (CTS).

Binomia opposed the petition, arguing the debt was not legally due and payable. The Court agreed, identifying genuine and substantial disputes on three fronts: (1) whether an event of default had occurred under the loan agreement; (2) whether valid notice had been given under clause 11.2; and (3) whether notice complied with clause 15’s formal requirements.

The judgment emphasised that the clause of the loan agreement detailing the terms of repayment was internally inconsistent and unsuitable for summary determination in insolvency proceedings. The Court also noted that email communications relied upon by the petitioner did not meet the contractual notice requirements.

The Court also noted that Abcor’s the seizure of stock belonging to CTS from a third-party site could be potentially unlawful, further supporting the discretionary refusal to wind-up.  (Binomia argued that CTS has a cross-claim, arising from Abcor’s action in confiscating the stock, that equalled or exceeded the petition debt).  It was expressly noted that there was no determination on this point, which may be the subject of separate Part 7 proceedings

This judgment is a reminder that:

1. Petitions must be based on debts that are clearly due and payable
2. The courts will scrutinise contractual notice provisions and compliance
3. Disputes over underlying contractual terms are inappropriate for resolution via winding-up proceedings
4. Self-help remedies, especially involving third-party property, may undermine a petitioner's position

Abcor Finance Securities Ltd v Binomia Ltd [2025] EWHC 2374 (Ch)