Licensed insolvency practitioner Edward Avery-Gee, of firm CG Recovery, was not entitled to add a penal notice to a Court Order without the Court’s permission, a High Court Judge has found. Mr Avery-Gee was acting as a Trustee in Bankruptcy in the matter.
The existence of the notice was subsequently used to justify a so-called Committal Application for a contempt of court. This is a serious application and can result in a civil court imposing a punishment of imprisonment or an unlimited fine.
His Honour Judge Richard Pearce, in a judgment published yesterday (21st Nov 2022), reveals that a court order was made against a Ms Lesley Ann Coppen, 56, in September of this year.
The order required Ms Coppen, as a director of Taray Brokering Ltd, to change the company records to show Edward Avery-Gee as the owner of the entirety of its shares.
The order, which did not contain a penal notice, was served on Ms Coppen by letter dated 23 September 2022 and required her to make the changes within 5 business days. This did not occur.
By letter dated 11 October 2022, Mr Avery-Gee wrote to Ms Coppen, enclosing a further copy of the order and requiring compliance within 24 hours. The copy of the order served was in identical terms to the order originally made, except that appended to the front of it a notice in the following terms:
IMPORTANT – PLEASE READ
PENAL NOTICE
IF YOU, LESLEY ANN COPPEN, DO NOT COMPLY WITH THE TERMS OF THE ATTACHED ORDER YOU MAY BE HELD IN CONTEMPT OF COURT AND MAY BE IMPRISONED OR FINED, OR YOUR ASSETS CONFISCATED OR INCUR ANOTHER PUNISHMENT UNDER THE LAW.
The judge “expressed concern that the second version of the order that had been sent to the Court had never directed that a penal notice be attached, yet the second version of the order served had such a penal notice attached“. Despite the parties settling and withdrawing their application, the Judge ordered a hearing should take place to investigate what had occurred.
Barrister Lisa Feng, representing Mr Avery-Gee, submitted to the court that it was open to the party who sought the injunction to append a penal notice to the order. Ms Feng stated to the Court that Mr Avery-Gee relied on past case law, the civil procedure rules, and a leading textbook in support of his position.
The Judge disagreed, stating “A party to litigation is not at liberty to add a penal notice to an order of the court of its own motion; rather, that party must apply to the court to vary the order if it wishes a penal notice to be added.“
“I am satisfied that a party is not at liberty to add a penal notice to an order of its own volition“.
The judgment concluded that even where the order does not contain a penal notice breach of the order may still have penal consequences.
Update 9th December 2022: Some doubt has been raised over the validity of the decision by solicitor advocate Mr David Burrows. His report ‘To prosecute a contempt application’ can be read on the ICLR website.
Mouse in the Court 