Judging the adjudication process

Based on recent Grand Court decisions, it is clear that potential creditors are expected to give cogent evidence to meet the threshold of satisfying liquidators and the court that a real debt exists.   We wrote about this topic here following the handing down of judgment in Ardon Maroon in the middle of last year.  More recently, in a decision concerning China Branding Group Limited, the Grand Court reiterated that the burden of proof rests on the prospective creditor.  The court must be satisfied on a balance of probabilities that in the circumstances the putative creditor has established the existence of a debt in the liquidation. 

In assessing the evidence before him, Mr Justice McMillan noted that "applying lengthy legal concepts and principles to what in fact transpired does not per se elevate what transpired into something which it never was in the first place."  In other words, as opposed to relying on legal arguments with the benefit of hindsight, the contemporaneous evidence put forward on behalf of the creditor should speak for itself.

 Read the full judgment here.