EWHC 377 (Ch),  All ER (D) 72
The claimant owned four properties within the borough covered by the defendant local authority. The authority assessed the claimant in respect of council tax in the total amount of £11,480.40, and subsequently served a statutory demand on the claimant. The claimant unsuccessfully applied to have that demand set aside. On or after 14 November 2007, the registrar authorised the authority to present a bankruptcy petition against the claimant, and that was issued on 11 December 2007. The petition was adjourned on two occasions by the deputy registrar. However, the claimant herself had requested an adjournment on the basis that she wanted to approach other tribunals, including the Valuation Tribunal (the tribunal), for a review of her liabilities. The petition was further adjourned to 30 June 2008. Meanwhile on 13 June, the claimant had issued an application for review of liability orders made against her by Stratford magistrates' court, and she had also unsuccessfully applied to the Administrative Court for interim relief, seeking to prevent the authority or the bankruptcy court from dealing with the bankruptcy proceedings. At the hearing on 30 June, the registrar made a bankruptcy order against the claimant, which the claimant sought to annul. On 23 July, having considered the annulment application on paper, the deputy registrar dismissed it. Shortly after, the Administrative Court refused her application for permission to apply for judicial review. In September, the claimant made a further application to annul the bankruptcy order, which was dismissed by the deputy registrar. The authority and the tribunal separately, further considered the evidence in respect of the assessments made against the claimant's properties, with the effect that the original petition debt was reduced to £1,385.00. The claimant appealed, inter alia, against: (i) the bankruptcy order made against her on 30 June 2008; and (ii) the decision of the deputy registrar on 23 July 2008 to refuse to annul the bankruptcy order.
Held – The appeals would be dismissed.
(1) Having considered the challenges raised by the claimant to the bankruptcy order of 30 June 2008, on the basis that they were not all fanciful, the appropriate order would be to extend time for the claimant's application for permission to appeal and to grant permission to appeal, but to dismiss the appeal.
(2) In respect of the decision of 23 July 2008 to refuse to annul the bankruptcy order, the deputy registrar had failed to take into account a material matter when he had dismissed the claimant's application to annul. He had failed to take into account that the claimant had made an application to the tribunal, challenging some or all of the assessments made against her, and that that was a circumstance which, although it had been in existence at the time of the bankruptcy order, had not been drawn to the attention of the registrar. Had the deputy registrar appreciated the significance of the reference to the tribunal proceedings, he ought to have called for an oral hearing of the application, at which the significance of the tribunal proceedings would have been explored. Consequently, the court was entitled to interfere with the exercise of discretion by the deputy registrar, and to exercise that discretion afresh itself. In the instant case, the court would proceed to re-exercise that discretion on the basis of the information before it, and not by trying to recreate the right decision by reference to the facts as they had been at a point in time six months ago. All the conditions for a valid bankruptcy petition having been met, in the exercise of the court's discretion, the annulment of the bankruptcy order would be refused.