In February 2016, Mr Justice Snowden handed down his judgment in
the High Court proceedings concerning Ralls Builders Limited (in
liquidation) [2016] EWHC 243 (Ch). This matter concerned an
application by the liquidators of Ralls Builders Limited (in
liquidation) (the company) for a declaration
regarding the alleged wrongful trading of the company by its
directors, under section 214 of the Insolvency Act 1986
(the Act).
The detailed and considered judgment sets out the historical
case law regarding wrongful trading, and addresses some of the
uncertainty in this area.
Mr Justice Snowden considered, as is usual, the dates from which
it was alleged that the directors knew, or ought to have known,
that there was no reasonable prospect of avoiding an insolvent
liquidation (the usual threshold for a finding of wrongful
trading). The directors were found to have been in a position
whereby they knew (or ought to have known) by 31 August 2010 that
there was no such
