H&J purchased a claim against two directors who had purchased the entire share capital of a subsidiary of an insolvent company.
H&J purchased a claim against two directors who had purchased the entire share capital of a subsidiary of an insolvent company. The directors claimed that they had paid approximately £110,000 for the shares – which had been purchased by the insolvent company a year earlier for £150,000.
The form of consideration allegedly provided was complex and the claim appeared to hold relatively low value (of up to £40,000 – being the difference between the two purchase prices). The liquidators had therefore resolved that they were unwilling to bear the cost and risk of taking the claim forward.
H&J purchased the claim and committed resource into detailed forensic investigatory work and pre-action correspondence with the directors. Investigations identified that the directors had fabricated certain documents submitted to the liquidators in an attempt to substantiate their claim to have paid £110,000 for the shares. They had, in fact, paid nothing!
H&J asserted claims in fraud and produced compelling evidence – including computer forensic analysis of the metadata contained within certain electronic documents. Within nine months of H&J’s assignment the defendants settled following mediation – resulting in payment of almost the entire value of the claim.
H&J secured the recovery of more than £7m pursuant to a judgment handed down on 5 January 2024.
