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On appeal from: [2016] CSIH 59

This appeal considered the construction of the expression ‘final distribution’ in a voluntary trust deed for creditors, and whether this includes a distribution made when the creditors receive less than 100 pence in the pound and there remain (following that distribution) assets vested in the trustee, albeit the trustee is unaware of their existence.

The Supreme Court unanimously dismissed the appeal, stating that Dooneen and Mr Davidson are entitled to the payment of compensation. The Court rejected the contention of Mr Mond that, regardless of whether or not the trustee knew of all of the assets, a “final distribution” can only occur when either all assets are distributed or enough assets are distributed so as to pay all creditors in full. This is because, to accept this construction would have consequences which the debtor would not have intended when granting the deed, including that it would make it impossible for the debtor or anyone doing business with him to know whether or not the debtor has been finally discharged.

For judgment, please download: [2018] UKSC 54
For Court’s Press Summary, please download: Court’s Press Summary
For a non-PDF version of the judgment, please visit: BAILII

To watch the hearing, please visit: Supreme Court Website (3 Jul 2018 morning session)