Honouring Cheques after Presentation of Winding up Petition – 2

Coutts & Co v Stock (Ch D LSG 17 December)

Facts similar to those in Hollicourt, above, did not preclude the bank from looking to a guarantor of the company’s overdraft arising from the bank’s continuing to honour cheques over the period between the date of presentation of a petition to wind up the company and the date of the subsequent winding up order. Section 127 of the Insolvency Act 1986 could not be read as invalidating what was in effect a loan made by the bank to the company to enable it to make a disposition.