The High Court postponed its determination of James Elliott Construction Limited’s petition to wind up Irish Asphalt Limited, directing the parties to provide further information about how appointing a liquidator could affect separate deceit proceedings. The court did not make a winding-up order or dismiss the petition in this judgment.
Mr Justice Tony O’Connor delivered the judgment on 31 July 2017. James Elliott Construction (JECL) petitioned on 14 February, after Irish Asphalt (IAL) did not pay a debt of €2,411,228.83, plus continuing interest at 2% a year. The debt arose from earlier contract proceedings and was undisputed in the petition. The judge recorded that no payment had been made.
The court considered whether the petition was driven partly by a potential litigation advantage in JECL’s separate deceit claim against IAL and other defendants. IAL, its parent company Lagan Holdings Limited and other defendants argued that winding up IAL could affect its defence in that case, which was scheduled for trial from 14 November 2017. JECL acknowledged that appointing a liquidator might provide an advantage, while submitting that it also sought an investigation into IAL’s affairs for unsecured creditors.
The judgment set out evidence and submissions about IAL’s finances and corporate history. It recorded that IAL knew by 2011, or earlier, that its liabilities exceeded its assets; that its trade had ceased in 2012; and that its net assets had fallen from €43 million in 2009 to a net liability of €9.9 million in 2015. The judge noted possible areas for a liquidator to review, but said he could not determine in advance what a liquidator would find or report. He also said the court could not assess the merits of the deceit proceedings.
The judge concluded that further consideration was needed before deciding whether to grant a potentially lengthy adjournment. He proposed directions for written submissions addressing the litigation advantages that might follow appointment on specified dates, possible steps to reduce those effects, and conditions for any winding-up order or further adjournment. The judgment invited the parties to address the proposed directions; it did not itself finally determine the petition.