Re Capitol Films Ltd (In Administration)

[2010] EWCH 2240 (Ch)

3rd September 2010

High Court


The company was a film distributor in administration. The majority of its assets consist of the contractual rights to distribute films, and many of those were claimed by various respondents to be the subject of fixed charges. The applicant administrators had entered into a contract to sell all of the rights, title and interest that the company might have to a purchaser. However by way of preliminary issue, the administrators asked the court to determine whether the company’s rights had previously passed to another company.


If the directors caused an insolvent company to transfer assets away without regard for the interests of the general body of creditors, they might commit a breach of duty to the company (West Mercia Safetywear Ltd v Dodd (1988) 4 B.C.C. 30). The court was not satisfied on the evidence that the prior assignment was effective

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