O'Kane Poultry Ltd v Henry

[3] It is quite clear that in order to have a members' voluntary liquidation it is a prerequisite that there is in place a statutory declaration and that is provided for in Article 75 of the Insolvency Order. Article 75 provides:

For directors of a company to make a statutory declaration of solvency it is quite clear that they must have made a full inquiry into the company's affairs, and they must have formed the opinion that the company would be able to pay its debts in full with interest within the maximum period of twelve months.

[6] Mr Hanna, on behalf of the plaintiff, seeks to avoid the consequence of that by contending that in the circumstances the obligation is on Garth Henry to procure the necessary steps. This implies with it an obligation, if necessary, to vote for and trigger the removal of Nigel Henry as a director of the company if he is not prepared to, as it were, swear up to the statutory declaration which Mr Hanna argues the court should require of Mr Garth Henry.

[7] That is an unusual scenario and a court would be extremely slow to make an order which impacts on the rights of a person who is obviously involved in the procedure but who is not involved in these proceedings. That is one problem that lies in the path of the plaintiff in relation to the application.

[8] When one turns to the argument in relation to the case that Mr Garth Henry ought to make the statutory declaration, the case is really based upon the proposition that Mr�Henry has material evidence which should satisfy him to reach the opinion that his father, Robert Henry, has quite sufficient assets to meet the liability on foot of the indemnity under the Indemnity Agreement. It is argued that the evidence points to the conclusion that Mr Robert Henry is a man of considerable substance who would have the wherewithal to meet the shortfall in the assets of Farmfed�Chickens.