Wilson v APG Holdings Ltd (in liq)

In the case of Wilson v APG Holdings Ltd (in liq), the liquidator sought to recover payments made to Mrs Wilson by the company within the specified period under Section 298(2) of the Companies Act 1993. The dispute centred on whether these payments, which were in excess of the value of any consideration received by the company, were recoverable. The court had to determine the validity of the liquidator's claim and whether the payments could be treated as loans by APG to Mr Wilson, with the promise to repay on each advance and the work done by Mr Wilson considered as valuable consideration.

The primary legal issue was whether the liquidator could recover the full amount of the payments to Mrs Wilson or if the value of the consideration received by the company was equal to the value of the advances, as argued by the liquidator. This hinged on whether Mr Wilson's promise to repay the loans and the services he performed could be considered valid consideration. The liquidator contended that the payments exceeded the value of any consideration, while Mr Illingworth argued that the value of the consideration was equal to the value of the advances.

The Associate Judge identified that the liquidator must establish three facts to apply Section 298(2). These were: the disposition of property within the specified period, the disposition to a person within the specified categories, and the value of the disposition exceeding the value of any consideration received by the company. The first and second facts were not disputed, but the third was contested. The liquidator argued that the value of the consideration was not equal to the value of the advances, while Mr Illingworth argued that the promise to repay and the services performed constituted valid consideration. Ultimately, the court ruled that the liquidator could only recover the amount by which the money paid to Mrs Wilson exceeded the value of any consideration received by the company.

The court's decision was that the liquidator could recover only the excess amount of the payments to Mrs Wilson that exceeded the value of any consideration received by the company. The court found that the value of the consideration provided by Mr Wilson, which included the promise to repay the loans and the services performed, did not equal the value of the advances. As a result, the liquidator's claim was partially upheld, and the liquidator was entitled to recover the excess amount.