Abbey Forwarding v Richard Hone and Others
In a two week trial in the High Court, Bark & Co successfully defended the former directors of Abbey Forwarding Limited in the High Court in an action brought by the liquidator of the company against them for breach of fiduciary duty.
Updated 23.07.2010
Abbey Forwarding Limited was a reputable and established bonded warehouse which operated from premises in east London from 1971 until the beginning of 2009. In February of 2009 Her Majesty’s Revenue & Customs (“HMRC”) raised assessments against the company for approximately £6 million and at an ex parte hearing successfully applied to have the company placed into provisional liquidation on the basis that the company had actively participated in diversion fraud.
The HMRC appointed liquidator immediately brought proceedings against the directors for breach of fiduciary duty alleging fraud against 3 of the directors. The basis for the claim and provisional liquidation by HMRC was that the directors fraudulently, or in the alternative negligently, allowed loads of duty suspended alcohol to be illegally diverted and sold onto the UK market.
The claim was dismissed in its entirety. In his judgement Mr Justice Lewison determined that not only was there insufficient evidence of any fraudulent behaviour on the part of the directors, but that the loads of alcohol had in fact reached their destinations and there was insufficient evidence to show any fraudulent diversion at all. The directors were fully exonerated and the liquidator was ordered to pay damages to the directors as well as their costs.