BL-2024-000734 - [2025] EWHC 2166 (Ch)

The next group of the Claimants points go to the question of whether there was in fact an Event of Default arising from either the failure to respond to the request for information or the failure to notify the chargee of claims.

For this purpose, we begin with the formal request for information under 1.11.1. This was contained in an e-mail of 15 July 2019 from David Fergusson, who described himself therein as “Partner, Nimoi Holdings Pte Ltd”. It reads:

“Dear Jason,

Pursuant to the Assignment of the Brahma Finance Loan Facility to our subsidiary, Niven Alpha, please would you provide to us:

1.

Minutes of any Board meeting held since entering into the Facility;

2.

Cash balances for Glint Pay Ltd and all its subsidiaries as at the end of each calendar month since entering into the Facility;

3.

A list of trade and other creditors for Glint Pay Ltd and all its subsidiaries as at the end of each calendar month since entering into the Facility;

4.

Details of any intercompany lending or creditor arrangements between Glint Pay Ltd and any of its subsidiaries at the end of each calendar month since entering into the Facility;

5.

Any information relevant under Clause 1.4 and 1.11 of Schedule 3 or the Guarantee and Debenture.

For the avoidance of doubt, we reserve all our rights.

Yours

David

David Fergusson

Partner, Nimoi Holdings Pte Ltd”

The Claimants make a number of points about this request. The first is that the request is not in fact from Niven, but from Nimoi, and therefore is not a valid request. The basis of the argument is the e-mail signature and the fact that it is sent from the email address “NIMOI – D Fergusson [[email protected]]”. It is notable that after receipt of this e-mail, Mr Cozens replied, making exactly this point – that the request should have come from Niven – and received a response to the effect that Mr Ferguson had made the request in his capacity as sole director of Niven. However, the Claimants still say that the form of the e-mail invalidates it.

This argument is clearly wrong. There can have been no doubt in the mind of either the sender or the recipient of the e-mail as to what was being requested, the basis of the request, or that the request was being made on behalf of Niven. Detailed textual exegesis of e-mail signatures and addresses is simply not an appropriate basis for the analysis of commercial transactions.

The second point relates to the scope of the information requested. The Claimants say that the request does not address the “location, condition, use and operation” of anything. In particular, they say that the request did not ask for the “location, condition, use and operation” of cash balances, that creditors are not an asset, and therefore fall outside the scope of the provision, and that “intercompany lending” might in part be an asset, but again Niven did not ask for the “location, condition, use and operation” of intercompany lending, which again would have been a meaningless request.

The Defendants say two things in response to this. First, they say that the words “location, condition, use and operation” do not have the limiting effect that the Claimants say that they do. The more significant point, however, is that since no information at all was provided, the Claimants can only succeed on this point if they can show that no part of what was asked for fell in any way within the narrow scope that they say that these words have.

I have addressed the significance of the “location, condition, use and operation” wording above, and I do not intend to repeat it here. In summary, I do not believe that the use of these words has the effect of limiting the power conferred by the section which is for the chargee to ask for information about the charged property in general. Consequently I am satisfied that the Claimants’ failure to provide any information at all in response to this request constituted a breach of its obligations, and therefore an event of default. However, I also note that, even if this were wrong, the Claimants clearly fail on the Defendants’ second argument - cash balances, for example, have a location and a use, trade creditors may have a condition (in the sense of their days due) and so on. Thus, even if the Claimants were correct on their narrow construction of the 1.11.1 power, they would still have been required to provide some response to the request, and by providing none at all, they breached their obligations under 1.11.1.

It therefore seems to me that the fact that an Event of Default had occurred by reason of the Claimants’ breach of their obligations under 1.11.1 is clearly established.

The Defendants advance a second ground on which they say an Event of Default had occurred, that being the failure of the Claimants to notify the chargee of a claim or potential claim in breach of 1.11.3. Given my finding above that there is a clear breach of 1.11.1 this is no longer a live issue. However, since I heard argument on this point, I would note that I am by no means sure that the Defendants would have succeeded on this ground.

The terms of 1.11.3 are that the chargor must:

“promptly notify the Lender in writing of any action, claim, notice or demand made by or against it in connection with all or any part of a Secured Asset or of any fact, matter or circumstance which may, with the passage of time, give rise to such an action, claim, notice or demand, together with, in each case, the Obligors's proposals for settling, liquidating, compounding or contesting any such action, claim, notice or demand and shall, subject to the Lender's prior approval, implement those proposals at its own expense.”

The question here is the difficult one of what level of certainty is required for a communication to constitute a circumstance which may give rise to a claim.

The specific points which the Defendants rely upon to show a breach of this provision are a concerned letter written by an unpaid supplier, an employment tribunal claim, and an action to restrain dealings with shares in Glint.

The first of these relates to an email letter dated 5 December 2018 (before the rights under the security arrangement were transferred to Niven) from a supplier called AIM. The Claimants say that this letter is neither a demand nor a claim, it is a request for a “firm level of commitment” and for information. Insofar as the letter contained a threat of further measures if the issues were not resolved, the issues were in fact resolved. There was never an “action, claim, notice or demand” by AIM during the currency of the Facility Agreement, nor any likelihood of one.

The second is an Employment Tribunal Claim, stamped “09 Apr 2019” against the First Claimant. The claim was for unfair dismissal and “whistleblowing”. The Claimants argue that a mere application to an Employment Tribunal is not an event which has a direct effect on the secured assets. Employment Tribunals do not enforce their own money awards, and a separate enforcement procedure through the High Court is required to be commenced once an award has been made. They say – and I think I agree – that it is only the commencement of enforcement proceedings in respect of an award made (or an agreement by the company to pay such an award) which would have triggered an obligation to notify under this clause.

The third is a claim by Mr Mahaffey. On 5 September 2019, Clarke Wilmott, on behalf of Mr Mahaffey, wrote a letter before action to the First Claimant putting them on notice of his intention to seek declaratory/injunctive relief preventing the disposal, transfer sale or otherwise of his shares in Glint. This was not a claim “in connection with all or any part of a Secured Asset”, nor could it have given rise to such a claim, since Mr Mahaffey’s shares were not a Secured Asset.

I think that there is real doubt as to whether the failure to notify these as claims to the chargee constituted an Event of Default under the Guarantee and Debenture. However, given that I am satisfied that such an event had taken place, the point is not relevant to the issue before me.