A High Court judge has “dismissed in its entirety” a dispute between the current liquidators and former administrators of London plot One Blackfriars Ltd, which is now the site of office block “the Boomerang”.
The current joint liquidators, who worked for CVR Global, have been claiming damages of more than £250m, alleging the mishandling of the administration by two partners at accountancy firm BDO.
They allege that “the asset was sold at an undervalue and that, had the former administrators complied with their duties, a corporate rescue of OBL may have been achieved”.
BDO was hired as administrator to the development project in 2010, and in 2011 it sold the site to developer Berkeley Group.
In the trial, which took place last summer, lawyers for the current liquidators alleged that the former administrators failed to act independently, did not properly assess the value of the site, particularly its planning value, and sold the site to Berkeley for less than its value.
The former administrators denied the allegations, saying that the project became “hopelessly insolvent” and it was reasonable to sell it in the interests of its creditors.
In a ruling handed down yesterday (23 March), High Court Judge John Kimbell QC dismissed all the allegations.
He ruled that the former administrators “complied with their statutory and other duties throughout the course of the administration”.
Specifically, he said there was no conflict of interest, the site was appropriately marketed, the bidding process was appropriately conducted and they took “reasonable steps to obtain the best reasonable obtainable price”.
He added: “As a result of my conclusions of fact and law it has not been necessary for me to decide all the issues in the agreed list of issues. The [joint liquidators] have failed to persuade me that the [former administrators] acted in breach of any of their duties.”
Adrian Charles Hyde and Kevin Anthony Murphy (as joint liquidators of One Blackfriars Ltd) v Antony David Nygate (in his capacity as representative of the estate of James Joseph Bannon, former joint administrator of One Blackfriars Ltd appointed under Cpr R 19.8(1)) and Sarah Megan Rayment (as former joint administrators of One Blackfriars Ltd)
Business and Property Courts (John Kimbell QC), 23 March 2021
Simon Davenport QC and Tom Poole (instructed by Humphries Kerstetter LLP) appeared for the applicants. Justin Fenwick QC and Ben Smiley (instructed by Mayer Brown International LLP) appeared for the respondents.
