The claimant (C), a limited partnership, applied for summary judgment in proceedings against the defendants (D) on the issue of whether it was entitled to bring claims based on assignments from investors to a collective investment fund prior to its insolvent liquidation.

Some of the investors were limited partners in the fund, which was an unregulated collective investment scheme. D were the operators of the fund. C alleged that D had breached the Financial Services and Markets Act 2000 s.238 and s.241 by unlawfully promoting the fund to the investors who became partners in it. C sued in its capacity as assignee of the claims enjoyed by the identified investors. Any recoveries made in respect of the assigned claims were to be treated as assets in the winding-up. The issues were whether (i) an insolvent partnership subject to a winding-up order satisfied the definition of a partnership within the Partnership Act 1890 s.1(1); (ii) CPR PD 7A para.5A precluded C from pursuing its claim on the basis that the causes of action on which the fund relied accrued to the investors in their personal capacities and not in their capacities as partners in the fund; (iii) the assignments were invalid as a device to circumvent the limitations on when claims under the 2000 Act could be maintained for the benefit of persons other than "private" persons within the Financial Services and Markets Act 2000 (Rights of Action) Regulations 2001; and (iv) the fund's liquidators had acted outside their statutory powers in purporting to take assignments on behalf of the fund.

HELD: (1) The issue was not whether the partners had continuing authority to wind up the affairs of the partnership after its dissolution, pursuant to s.38 of the 1890 Act, but the authority of the liquidators, as the action had been brought by the liquidators on behalf of the fund and not by the former partners under s.38 (see para.18 of judgment). (2) CPR PD 7A para.5A should be read broadly and in accordance with the overriding objective to provide a machinery to enable claims such as the instant one to be tested. Given that para.5A was part of a rule providing how to bring a claim, it should not be interpreted restrictively. The breadth of that provision was emphasised by the fact that para.5A.2 included "persons claiming to be entitled as partners". It was clear that the claim was being brought by the assignees of the investors' claims in the form of the fund or the individual partners in it (paras 29-30). (3) The assigned claims were not brought in a fiduciary or representative capacity. A claim under s.150 of the 2000 Act was only actionable by a private person and was not a claim which could be brought by natural and legal persons alike, Norglen Ltd (In Liquidation) v Reeds Rains Prudential Ltd [1999] 2 A.C. 1 distinguished. Regulation 6 of the 2001 Regulations did not apply. An assignee was not usually a fiduciary or someone acting in a representative capacity. In determining whether assignment was permitted, the words "at the suit of" in s.150 of the 2000 Act was not to be interpreted as removing what would otherwise be a claimant's right to assign. If Parliament had intended to restrict the right to assign, it would have said so clearly. There was nothing inherently offensive about the notion of assigning rights, and it might be positively desirable to permit private persons to assign in order to make it easier and cheaper to assert their rights, Financial Services Compensation Scheme Ltd v Abbey National Treasury Services Plc [2008] EWHC 1897 (Ch), [2009] Bus. L.R. 465 applied (paras 41, 45-46). (4) The fund already had power under the Insolvency Act 1986 Sch.4 Pt II para.4 to bring the action in issue. Sch.4 para.13 was also self-standing and enabled the liquidator to do all other things necessary for winding up and distributing property. The balancing of the risks of litigation against the prospect of making a substantial recovery for the benefit of the creditors was an issue for the liquidators in the exercise of their judgment. Provisions dealing with the affairs of a business had to be seen in the light of commercial realities. It followed that C was able to bring its claims on the basis of the assignments (paras 53, 55-57).

Application granted


For the claimant: Robert Anderson QC, Andreas Gledhill

For the first defendant: John L Powell QC, Shail Patel

For the second defendant: Aiden Christie QC, Paul O'Doherty


For the claimant: King & Wood Mallesons LLP

For the first defendant: Herbert Smith Freehills

For the second defendant: Nexus Solicitors

Link to full judgment here.