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	England and Wales Court of Appeal (Civil Division) Decisions
You are here: BAILII >> Databases >> England and Wales Court of Appeal (Civil Division) Decisions >> BST Properties Ltd v Reorg-Aport Penzugyi RT [2001] EWCA Civ 1071 (19 June 2001) URL: http://www.bailii.org/ew/cases/EWCA/Civ/2001/1071.html Cite as: [2001] EWCA Civ 1071

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IN THE SUPREME COURT OF JUDICATURE
IN THE COURT OF APPEAL (CIVIL DIVISION)
APPLICATION FOR PERMISSION TO APPEAL

		Royal Courts of Justice Strand London WC2 Tuesday, 19th June 2001

1. LORD JUSTICE CHADWICK: This is an a renewed application for permission to appeal against the order made by Mr Justice Laddie on 15th February 2001. He refused to restrain proceedings following the presentation of a winding up petition against the applicant, BST Properties Ltd. The petition was subsequently heard and a winding up order was made. The application before me is made by Mr Patrick Malcolm Reynolds, a director - indeed, he tells me, the sole director - of BST Properties Ltd who appears on his own behalf and on behalf of the company with permission, in the circumstances that he is not in a position to instruct legal representatives.
2. The petition was based on an alleged debt of US$5 million; being monies lent to BST Properties in connection with the purchase of companies in Gibraltar and their assets. The arrangement was of some complexity. It is explained, as it appears from the documents, by the judge in the judgment which was delivered on 15 February 2001. Put very shortly, it is said on behalf of BST Properties Ltd that the lender agreed to make a loan to BST in order to enable BST to purchase the Gibraltar companies and their assets; with the intention that those assets would then immediately be transferred to a second company, Telnan SL, as a vehicle for further acquisitions. Telnan SL, it is said, was nominated as transferee by the lender. The position therefore, as advanced by Mr Reynolds on behalf of BST, is that either (i) the loan should have been written off at the time when the assets were transferred by BST to Telnan SL or (ii) if the loan were not to be written off, then BST has never been paid for the assets - the purchase of which was funded by the loan - and should be entitled to recover those assets from the lender's nominee.
3. The matter is plainly of some complexity. The judge took the view that there was no dispute in substance that $5 million had been lent and had not been repaid. All the documents pointed to that conclusion. The application to restrain the petition which was before him appears to have been made on the basis that the documentation was a sham; and that what was really happening was that BST was acting as agent for the lender. The judge rejected that contention on the basis, as he explained, that he found it incredible in the face of the documents that were signed.
4. The judge's attention was not drawn - so far, at least, as appears from his judgment - to paragraph 18 of the loan agreement made between the creditor and BST Properties on 5th June 1998. The agreement was made in the Hungarian language but an authorised translation has been provided. Clause 18 provides that the parties should attempt to settle any disputes arising in connection with the agreement by conciliation, and in the event of an unsuccessful outcome the Metropolitan Court of the Republic of Hungary shall have sole competency. Mr Reynolds has submitted to me that if this dispute were before the Hungarian court that court would have access to information which would not be available to a court in England; and, for that reason, BST is entitled to object to winding up proceedings here.
5. The only question with which I am concerned is whether an appeal against the judge's order has any real prospect of success. In the light of clause 18 of the loan agreement, I find it impossible to say that there is no real prospect of success. It seems to me that - without intending to give Mr Reynolds any encouragement - this a case in which the appeal should be entertained by the Court of Appeal.
6. Accordingly, I give the permission that is sought. Do you need an extension of time?
7. THE APPLICANT: No, my Lord.
8. LORD JUSTICE CHADWICK: I do not think so. You will have to serve your appellant's notice in the ordinary way within a very short time; is it seven days? That direction is automatic. I will direct that costs of this application be costs in the appeal.
Order: Application allowed.