Mr Rowan Pennington-Benton (instructed by Pinder Reaux) for the RESPONDENT
I.C.C. Judge Jones (Sitting in Retirement)
A) Introduction
- The judgment of 16 October 2025 (“the First Judgment”), with which this judgment is to be read, adjourned the Trustees’ annulment application (“the Application”) and granted permission to amend the Application Notice to address the following two issues:
a) Whether the Bankruptcy Order (“the Order”), made by an Adjudicator on 21 December 2021, ought not have been made and should be annulled because Mr Jones’ domicile was in Austria with the result that there was no jurisdiction to make the Order (“the First Issue”); or
b) Whether the Order should be annulled or rescinded because: Mr Jones had no assets (or only nominal assets) within this jurisdiction when the Order was made; he incorrectly asserted in his bankruptcy application that he owned a half share in the equity of his former matrimonial home in England; the assets which would form the bankruptcy estate were in Austria; Austrian law does not recognise a bankruptcy based on domicile but requires it to be based on the location of the centre of main interests, which was in Austria not England; and such an order is justified in the context of post Order conduct (“the Second Issue”).
- In a nutshell, the first issue turns upon whether Mr Jones retained his domicile of origin or had acquired a domicile of choice in Austria. At this stage, it is sufficient to describe the legal test of change of domicile as being: whether the Trustees have proved on the balance of probability whether directly or by inference from the evidence that Mr Jones’ domicile of origin was superseded at the time of the Bankruptcy Order by his domicile of choice because Mr Jones not only resided in Austria but had the intention that Austria was his permanent home, the place where he would reside indefinitely, where he was an inhabitant.
- Mr Jones would not have abandoned his domicile of origin if, for example, his intention had been to reside in Austria for a limited period or for a particular purpose on the basis that he would leave there once that purpose was completed. If he abandons a domicile of choice, the domicile of origin will revive in the absence of a new domicile of choice. There can only be one place of domicile. It is more difficult to prove abandonment of the domicile of origin than abandonment of a domicile of choice (see generally paragraph 6-042 of Dicey, Morris & Collins, “The Conflict of Laws” (“Dicey“) and the law as set out in paragraph 19 of the First Judgment).
- As to the Second Issue, the Trustees abandoned their claim for rescission at the hearing. It was agreed with Mr Jones that I am bound by precedent to conclude there is no jurisdiction for such an application before the Companies and Insolvency Court when the Order was made by an Adjudicator on a debtor’s application. That is because there can only be a review of a decision made by a Court of co-ordinate jurisdiction (see section 375(1) of the Insolvency Act 1986 (“the Act“) and Sands v Layne and Another [2016] EWCA Civ 1159, [2017] 1 WLR 1782).
- The Second Issue, addressing annulment, first concerns the Court’s discretionary power to refuse to make a bankruptcy order even if the statutory requirements are met. Mr Jones disputes that this power applies to an Adjudicator’s decision upon a debtor’s application. If it does, the Second Issue asks the question, whether the Order ought not to have been made because that discretion should be exercised. If the answer is that it ought not to have been made, the further question is whether the Court should exercise its discretion to annul.
B) The Respective Cases
- There are no statements of case other than the Amended Application Notice, to which was added (by agreement between counsel) details set out in an email sent by the Trustees’ solicitors on 20 October 2025 (“the October 2025 Email”). The substance of the respective cases is to be derived from the evidence. The First Judgment has addressed the evidence filed in support and in opposition, so that material is not repeated except when it is necessary to do so. Over the adjournment, there has been filed further evidence in support addressing the position of creditors, further evidence in answer setting out facts and matters relied upon in opposition to the amended Application and additional evidence in reply.
- As to the First Issue, the following summary of the Trustees’ case is taken from Counsel’s skeleton argument:
“The Trustees’ case as to domicile is that at the time of the bankruptcy application the Bankrupt had acquired a domicile of choice in Austria. He was resident there and the relevant intention can be inferred (in addition to the Bankrupt’s previous evidence in the family proceedings as to his intention and domicile). There had been material changes since the family proceedings. Reliance will be placed on the matters set out in our evidence and skeleton arguments.
In the alternative, the order ought not to have been made and ought in the court’s discretion be annulled and/or rescinded in all the circumstances set out in the evidence and skeleton arguments. These include:
i) The incorrect contents of the bankruptcy application – the Bankrupt wrongly suggesting he had an interest in the former matrimonial property in England and therefore an asset in England; this would have been a material consideration as to whether a bankruptcy order ought to be made
ii) The asset position of the bankruptcy estate – there are no substantial assets in the UK; there are assets in Austria, however the Trustees are unable to realise such
iii) The subsequent conduct of the bankrupt – including non-cooperation and actions taken to thwart recognition in Austria / realisation of assets; not facilitating the Trustees in recovering property vested in them
iv) The lack of recognition of the Bankruptcy in Austria and its consequences, including the consequences for the unsecured creditors
Continue reading this Judgment here.
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