The High Court has refused applications by Brian O’Neill and Fergus Rice to dismiss bankruptcy summonses brought by SFS Markets Limited, formerly Marketspreads Limited. Ms Justice Dunne held that the applicants had not raised a real and substantial issue requiring a separate trial on whether their share transfers had settled their debts in full.
Marketspreads obtained consent judgments against each man on 28 March 2012 for €1,686,883.66 plus statutory interest. Under a share purchase agreement signed on 17 April 2012, their shares in OR Spreadbetting Limited were sold for €400,000. The agreement applied that sum against the judgments and defined the remaining debt as €1,286,883.66. The bankruptcy summonses sought that balance, with interest.
O’Neill and Rice argued that they had agreed to transfer their entire shareholdings in full and final settlement. They said they were told the balance would not be pursued and that the agreement did not reflect what had been agreed. They also complained they had no opportunity to obtain legal advice and did not receive copies of the agreement when they signed it.
Marketspreads disputed their account. It relied on the agreement’s express acknowledgment of the remaining debt, a clause stating it contained the entire agreement, and a provision recording that the sellers had obtained or been offered the opportunity to obtain legal advice. The company also relied on later correspondence and statements of affairs that, it said, showed the men knew further sums remained due.
The judge said the consent judgments remained valid and binding, had not been appealed, and could not be looked behind in these applications. The separate plenary proceedings seeking, among other relief, rectification or rescission of the share purchase agreement and orders concerning the judgments had not established grounds to set the judgments aside in this hearing.
Under section 8(6)(b) of the Bankruptcy Act 1988, the court must dismiss a bankruptcy summons if an issue arises for trial. The judge concluded that the signed agreement contradicted the applicants’ claim of full settlement and that their other complaints did not raise an issue requiring separate litigation. She refused both applications to dismiss the summonses. The judgment does not determine the separate plenary proceedings or make a bankruptcy adjudication.