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Umbrella Care Ltd v Nisa & Ors. [2022]

Acting for the liquidators on a summary judgment application arising from a multimillion pound labour supply fraud committed by an umbrella payroll company, which deducted VAT, PAY and NICs and then submitted false returns to conceal the true position. The directors then extracted substantial sums from the company which should have been paid over to HMRC. HMRC’s claim in the liquidation totals about £36 million. Some of the money was traced into bank accounts and some used to acquire numerous properties through a network of companies. At the outset the Company obtained freezing and proprietary orders. The Company sought summary judgment against some of the Defendants arising out of its claims for breach of fiduciary duty, dishonest assistance and knowing receipt. Following a two-day hearing the Judge ruled in favour of the Claimant and found that that there was no real prospect of the Defendants successfully defending the breach of duty and knowing receipt claims. He ordered judgment with damages/equitable compensation to be assessed and substantial interim payments. The court also made declarations that 19 properties and a bank account held in the name of the Defendants were held on constructive trust for the Claimant and made an order requiring the bank to pay the money direct to the Claimant.