Sub-Fund Not an “Unregistered Company” Capable of Being Wound Up under Insolvency Act 1986, says Court of Appeal: East Riding of Yorkshire Council v KMG SICAV-SIF-GB Strategic Land Fund [2025] EWCA Civ 1137
The Court of Appeal was asked to determine whether a Sub-Fund of a Luxembourg specialised investment company was an “unregistered company” within the meaning of section 220 of the Insolvency Act 1986 (“IA 1986”), and hence capable of being wound up by the Court under section 221 IA 1986.
Lord Justice Snowden (with whom Lady Justice Nicola Davies and Lady Justice King agreed) held that the Sub-Fund was not an “unregistered company” within the meaning of the 1986 Act and, therefore, dismissed the Council’s appeal.
Drawing on previous authorities, Snowden LJ found that the court was required to focus its attention not only on the nature and construction of the body in question, but also upon the nature of the process of winding up by the Court under the IA 1986.
In respect of the former, Snowden LJ expressed that to fall within s220 IA 1986 an association must be comprised of persons who have some substantive legal relationship with each other. The Sub-Fund was not in any sense a body whose existence was founded on contractual obligations undertaken by any members between themselves.
Turning to the latter, given the essential nature of the winding up process as a means of collective enforcement of debts, as the Sub-Fund was not a debtor and did not have creditors, the Court of Appeal judged that the Sub-Fund was not an association which Parliament could have intended should be wound up by the Court under s221 IA 1986.
Read the full judgment here.
Read the full case digest here; Case Digest September 2025 No. 14
