The High Court granted a stay until 1 January 2015 on execution and registration of a US$683,922.31 judgment against two respondents in a dispute over the sale of shares in Josar Holdings Limited. The judge refused to give them a further opportunity to seek an extension.
The judgment, delivered by Mr Justice Kelly on 24 October 2014, followed a settlement under which the respondents agreed to buy the petitioner’s shares for US$11 million and pay his costs. The settlement, signed on 10 October 2012, set out staged payments. The petitioner had received more than US$3 million under it, but payments were overdue.
The agreement allowed the petitioner to return to court for judgment if at least US$600,000 of the share purchase price remained unpaid after 1 November 2013. The judge found that threshold had been met and entered judgment on 15 October 2014. He had rejected a separate argument that the petitioner could include costs to reach the higher threshold for judgment on the full amount payable under the agreement.
The respondents sought to pause enforcement until the end of 2014, with liberty to seek an extension. They said efforts to sell the shares were advancing, including through Investec, and that enforcement could damage negotiations, complicate replacement banking arrangements and threaten the company’s finances and employees. The petitioner disputed that enforcement of a judgment below US$700,000 against the respondents personally would imperil the company, and challenged the explanations for missed payment deadlines.
Justice Kelly said the petitioner had a strong prima facie right to enforce the judgment. He found the respondents’ explanation for late payment plausible, though not an excuse, and said substantial progress had been made towards a share sale and discharge of the obligations. He considered there was a realistic prospect that refusing a stay would cause serious damage to the company and jeopardise the settlement’s implementation.
The stay was granted in light of an undertaking offered by the respondents that they would not deal in their shares during the stay, including by pledging or charging them, and the petitioner’s contractual entitlement to interest on late payments. The order prevents execution and registration only until 1 January 2015. The judge said the period was ample and refused any further opportunity to apply for an extension.