Laura WilesThe High Court has granted a payment institution special administration order for JNFX Ltd – an authorised payment institution – upon application by its directors.
It was common ground between the parties that JNFX was insolvent and that a special administration order ought to be made. The key issue in the hearing was determining which administrators to appoint over the company.
Although the company’s directors proposed to appoint Mark Boast and Allister Manson of Opus Restructuring – and were supported in this proposal by the FCA due to Opus’ prior involvement with the company – the court appointed Louise Brittain and Matthew Richards of Azets, as proposed by various creditors who together represented around 57% of the JNFX’s creditors in number, and 88% of the company’s liabilities by value.
In making its decision, the court noted that all four candidates were suitable for appointment, and turned instead to a legal basis for choosing between the two proposed appointments. Here, the court cited the principle in Oracle (Northwest) v Pinnacle [2008] EWHC 1920 (Ch), that in circumstances where significant creditors have a clear preference (and in that case, where the secured and other creditors remain neutral) the court should resolve the matter in favour of the wishes of the significant creditors.