Bellmex International v British American Tobacco

United Kingdom

The Bellmex International v British American Tobacco case is an interesting reminder to insolvency practitioners that section 236 of the Insolvency Act 1986 (which confers power on office-holders to force third parties to provide information about the company) is a fairly draconian power and can only be used in appropriate circumstances.

Mr Justice Evans Lombe held that while the powers contained in section 236 of the Insolvency Act 1986 could be used to deal with factual issues relating to a proof of debt by an alleged creditor, the circumstances in which this would in fact be possible would have to be such as to show a "clear necessity" for the order. In other words, the case would have to be exceptional.