Re Spectrum Plus: Difference between revisions

Re Spectrum Plus (view source)

Revision as of 10:01, 17 January 2018

1,478 bytes added , 17 January 2018

no edit summary

Amwelladmin

Bureaucrats, Interface administrators, Administrators

83,229

edits

@@ Line 1: / Line 1: @@
 {{Cite1|Re Spectrum Plus|2005|UKHL|41}} is an important case about [[fixed charge]]s.
-{{seealso}}
+===Issue===
+Whether a {{tag|charge}} over present and future [[book debts]], where:
+*the chargor cannot dispose of or charge the uncollected book debts but
+*the charger ''can'' deal with debtors and collect the debts and
+*the chargor ''must'' deposit collected debts in a designated account with the charge, ''but''
+*the chargor can then freely draw on the account as long as it doesn't exceed the overdraft
+is capable in law of being a {{tag|fixed charge}}.
+===The facts===
+*Spectrum had an overdraft with the [[NatWest]].
+*NatWest took a fixed charge over its book debts to secure the overdraft. it required Spectrum to pay the debts into the overdraft account. It did not prevent Spectrum withdrawing them.
+*The bank never sought to exercise any control over Spectrum’s withdrawals from the account.
+*Spectrum never exceeded its overdraft. Nor did Spectrum ever go into credit.
+You can see where this is going, can’t you.
+When Spectrum, inevitably, went bust, it owed NatWest £165,407 on the account. Its uncollected book debts had a face value of £291,293, and a likely collection value of £156,544. You know, like roughly. Other unsecured creditors wanted a piece of the action.
+So ...?
+===Ruling===
+“The correct conclusion, in my opinion, is that the debenture, although expressed to grant the bank a {{tag|fixed charge}} over Spectrum's [[book debts]], in law granted only a {{tag|floating charge}}.
+===In other words===
+*[[Beware of magic words]].
+”{{seealso}}
 {{casenote1|Re Lehman Brothers International}}