Place of debtor’s operations

Shierson v Lieland-Boddy CA TLR 26 September

On an application to serve an insolvency petition on a debtor living outside the jurisdiction, the place where he had his centre of main interests is to be determined when the court is required to decide whether to open insolvency proceedings. Where those proceedings were commenced by the presentation of a bankruptcy petition, that time would normally be the hearing of the petition. But where the issue arose in the context of an application for permission to serve the petition out of the jurisdiction, the time the centre of the debtor’s main interest should fall to be determined would be at the hearing of the application. Similar considerations would apply if the court were faced with an application for interim relief in advance of the hearing of the petition. The centre of main interest was to be determined in the light of the facts as they were at the relevant time for the determination. In making its determination, the court should have regard to the need for the centre of main interest to be ascertainable by third parties; in particular, creditors and potential creditors. It is important therefore to have regard not only to what the debtor was doing, but also as to what he would be perceived to be doing by an objective observer.