A tax expert involved with an unregistered company forced by the Financial Conduct Authority to pay back investors millions of pounds has escaped being disqualified as a company director.
A judge at the Insolvency Court in London today ruled that lawyers for the secretary of state for business had failed to prove that Nigel Lord “totally abrogated” his duties when he was non-executive director of landbanking scheme Asset Land Investment.
In 2016, the Supreme Court ruled that Asset Land should pay back investors £21m, ruling that it had been running an unauthorised collective investment scheme that should have been regulated by the FCA.
The company sold investors plots of land saying that the value would increase if the plots received planning permission.
The case had been brought by the City regulator as part of a crackdown on unregulated investment businesses.
Lawyers for the business secretary have been seeking to have the directors of the business disqualified as company directors.
The civil trial of three of the directors was scheduled to take place in November last year. Just before the trial two accepted a three-year disqualification, leaving Lord to face trial alone.
According to a ruling handed down today, lawyers for Lord argued that, as a non-executive director and tax adviser, his role was advisory, and he did not make decisions that would warrant being disqualified.
In his ruling in the Insolvency Court, Greenwood J ruled that lawyers for the business secretary had not sufficiently proven their case.
“A disqualification order has serious consequences entailing a substantial interference with the freedom of the individual, sometimes described as penal or quasi-penal,” he said.
“The burden of proof lies on the secretary of state, as claimant. In the present case, I also remind myself of the long passage of time since the material events, of the paucity of relevant documents, and of the consequent significant difficulties of proof.
“Moreover, the issue is not whether Mr Lord’s conduct was impeccable or exemplary; it is a ‘value judgment’ – whether Mr Lord’s conduct renders him ‘unfit to be concerned in the management of a company’.
“In all the circumstances, on the evidence before me, even if some criticism of Mr Lord’s conduct might in retrospect be made, I cannot find in favour of the secretary of state.”
Secretary of State for Business, Energy and Industrial Strategy v 1) Mr Nigel Jonathan Robert Lord 2) Mrs Victoria Elisabeth Grace 3) Mrs Bronwen Banner-Eve
Insolvency Court (Greenwood J) 19 January 2022
