[2025] EWHC 2316 (Ch)

The argument based on ousting the powers of the court

I have already quoted at length from City Equitable and have reached the conclusion that s.212 (like s.215 CCA 1908 before it) is a jurisdictional provision providing a particular way of accessing the court, rather than a section that provides any particular powers of the court. To that extent, I agree with Mr Deacock that the liabilities that the Former Liquidators were hoping to exclude were not liabilities created by statute, but the natural incidents of their appointment arising under the general law and equity. There is, therefore, no ouster of the court’s jurisdiction that arises from a provision purporting to limit these liabilities as these are not liabilities created by the statute.

Ms Addy points out that s.212(3) appears to go beyond jurisdiction and specifically to provide the court with powers to examine the conduct of particular persons (including liquidators) and to compel liquidators to repay, restore or account for money; or to contribute as the court sees fit”. Under s.214(4), with the leave of court, this could include applications made after a liquidator has had his release. However, in this respect it is no different to s.215 CCA 1908, and so it does not seem possible to distinguish City Equitable on this point.

Ms Addy drew my attention to s.112 IA 1986 as a further example of a provision providing the court with control over liquidators. This provision allows a liquidator or any contributory or creditor to apply to the court to determine any question arising in the winding up or to exercise any of the powers which the court might exercise if the company were being wound up by the court. This seems to me to be a similar jurisdictional provision, and I cannot see how a limitation of liability could be seen as an ouster of the powers of the court under this section.

It is difficult to square the decision in City Equitable with that in Aribisala(referred to at [‎41]-[‎43] above). In Aribisala, the Deputy Judge, having found that s.49(2) LPA 1925 was a clause conferring jurisdiction on the court (rather than rights on a purchaser of land), considered that it followed that it was against public policy to allow the parties to contract out of the operation of the clause.

Mr Deacock made an argument that the difference between these two cases was that the jurisdiction conferred by s.49(2) LPA 1925 inevitably interfered with whatever contractual rights the parties had agreed, so that it was obvious that they could not contract out of the provision, whereas s.215 CCA 1908 (and now s.212 IA 1986) was purely about providing a means of accessing the court to enforce rights that already existed otherwise than under the statute.

I see merit in this argument, but even if this is not correct, if I have to choose between the two cases, then I must choose City Equitable as binding on me as a Court of Appeal decision, particularly as it seems that this case was not cited in Aribisala.

In conclusion on this point, I do not accept that the argument that allowing the parties to limit liability would operate as an ouster of the court’s jurisdiction itself provides a sound basis for the conclusion that it is impossible for the liability of liquidator to be limited. However, as I have found other grounds to support that conclusion the point is of academic interest only.