BL-2024-000734 - [2025] EWHC 3003 (Ch)

The fourth ground of appeal is that I was wrong to consider that the meaning of the words “location, condition, use and operation” did not imply a restriction of the power to obtain information in respect of charged assets. I pointed out as part of my discussion of this point that it would be contrary to ordinary commercial practice for a floating charge holder to confine his information rights to fixed assets only (at [45]). The Claimants say (correctly) that there was no evidence as to ordinary commercial practice before me, and that the fact that the agreement had been drafted between lawyers meant that it could be assumed that it was not intended to reflect ordinary commercial practice in any event.

I did not rely on any particular factual finding as to ordinary commercial practice for any part of my decision. My finding was that the term as drafted appeared to “give the lender rights of information as to the assets which he is funding, and which constitute his security” ([45]), and that this is exactly which one would expect to find in a typical charge document, and that this, applying the principles set out by Lord Hodge in Wood (cited in [26]), supported the construction of the Charge advanced by the Defendants.

The Claimants’ submissions in support of this ground also suggest that I should have taken into account the fact that the Chargee might not have required these rights because of the alternative rights available to them under s.431 of the Companies Act 2006 to financial information, and the right contained in the Charge for them to attend board meetings. If this argument had been put forward at trial (which it was not) I would have rejected it – the Chargee unquestionably did have such rights, but they do not provide any kind of substitute for a right to require information about the state of the assets subject to the charge.

This ground of appeal therefore has no reasonable prospect of success.