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You are here: BAILII >> Databases >> England and Wales Court of Appeal (Civil Division) Decisions >> East-West Logistics Llp v Melars Group Ltd [2022] EWCA Civ 1419 (28 October 2022) URL: http://www.bailii.org/ew/cases/EWCA/Civ/2022/1419.html Cite as: [2023] Bus LR 260, [2022] EWCA Civ 1419, [2023] ILPr 29, [2023] 1 BCLC 307, [2023] BPIR 127, [2023] BCC 296 |
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ON APPEAL FROM THE HIGH COURT OF JUSTICE
BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES
INSOLVENCY AND COMPANIES LIST
Mr. Justice Miles
Strand, London, WC2A 2LL |
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B e f o r e :
LORD JUSTICE SNOWDEN
and
SIR LAUNCELOT HENDERSON
____________________
| EAST-WEST LOGISTICS LLP |
Appellant/ Petitioner |
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| - and – |
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| MELARS GROUP LIMITED |
Respondent |
____________________
James Sheehan (instructed by Hogan Lovells International LLP ) for the Respondent
Hearing date : 6 July 2022
____________________
Crown Copyright ©
Lord Justice Snowden :
"The courts of the Member State within the territory of which the centre of the debtor's main interests is situated shall have jurisdiction to open insolvency proceedings ('main insolvency proceedings'). The centre of main interests shall be the place where the debtor conducts the administration of its interests on a regular basis and which is ascertainable by third parties.
In the case of a company or legal person, the place of the registered office shall be presumed to be the centre of its main interests in the absence of proof to the contrary. That presumption shall only apply if the registered office has not been moved to another Member State within the 3-month period prior to the request for the opening of insolvency proceedings."
The factual background
i) the six commercial contracts concluded by the Company of which the Petitioner was aware (including its own charterparty) were in the English language, were governed by English law and had arbitration clauses providing for arbitration in London; and
ii) the Company participated in the LCIA arbitration in London and was represented by a London firm (or firms) of solicitors.
i) the Company did not actually have an office there, its registered office address being that of a Cypriot law firm providing company administration services;
ii) the Company did not have any employees or conduct any business in Malta;
iii) the Company's sole director was a nominee who was a Swiss national, resident in South Africa; and
iv) the Company's sole shareholder and principals were Russian.
The Judgment of Judge Baister
"(27) Before opening insolvency proceedings, the competent court should examine of its own motion whether the centre of the debtor's main interests or the debtor's establishment is actually located within its jurisdiction.
(28) When determining whether the centre of the debtor's main interests is ascertainable by third parties, special consideration should be given to the creditors and to their perception as to where a debtor conducts the administration of its interests. This may require, in the event of a shift of centre of main interests, informing creditors of the new location from which the debtor is carrying out its activities in due course, for example by drawing attention to a change of address in commercial correspondence, or by making the new location public through other appropriate means.
(29) This regulation should contain a number of safeguards aimed at preventing fraudulent or abusive forum shopping.
(30) Accordingly, the presumptions that the registered office, the principal place of business and the habitual residence are the centre of main interests should be rebuttable, and the relevant court of the Member State should carefully assess whether the centre of main interests is genuinely located in that Member State. In the case of a company, it should be possible to rebut this presumption where the company's central administration is located in a Member State other than that of its registered office, and where a comprehensive assessment of all relevant factors establishes in a manner that is ascertainable to third parties, that the company's actual centre of management and supervision and the management of its interests is located in that other Member State. […]
(31) With the same objective of preventing fraudulent or abusive forum shopping, the presumption that the centre of main interests is at the place of the registered office, at the individual's principal place of business or at the individual's habitual residence should not apply where, respectively, in the case of a company, legal person or individual exercising an independent business or professional activity, the debtor has relocated its registered office or principal place of business to another Member State within the 3-month period prior to the request for opening insolvency proceedings, or, in the case of an individual not exercising an independent business or professional activity, the debtor has relocated his habitual residence to another Member State within the 6-month period prior to the request for opening insolvency proceedings.
(32) In all cases, where the circumstances of the matter give rise to doubts about the court's jurisdiction, the court should require the debtor to submit additional evidence to support its assertions and, where the law applicable to the insolvency proceedings so allows, give the debtor's creditors the opportunity to present their views on the question of jurisdiction."
"31. The concept of the centre of main interests is peculiar to the Regulation. Therefore, it has an autonomous meaning and must therefore be interpreted in a uniform way, independently of national legislation.
32. The scope of that concept is highlighted by the thirteenth recital in the Preamble to the Regulation, which states: "The 'centre of main interests' should correspond to the place where the debtor conducts the administration of his interests on a regular basis and is therefore ascertainable by third parties."
33. That definition shows that the centre of main interests must be identified by reference to criteria that are both objective and ascertainable by third parties. That objectivity and that possibility of ascertainment by third parties are necessary in order to ensure legal certainty and foreseeability concerning the determination of the court with jurisdiction to open main insolvency proceedings. That legal certainty and that foreseeability are all the more important in that, in accordance with article 4(1) of the Regulation, determination of the court with jurisdiction entails determination of the law which is to apply.
34. It follows that, in determining the centre of main interests of a debtor company, the simple presumption laid down by the Community legislature in favour of the registered office of the company can be rebutted only if factors which are both objective and ascertainable by third parties enable it to be established that an actual situation exists which is different from that which locating it at the registered office is deemed to reflect.
35. That could be so in particular in the case of a 'letterbox' company not carrying out any business in the territory of the Member State where its registered office is situated.
36. By contrast, where a company carries on business in the territory of the Member State where its registered office is situated, the mere fact that its economic choices are or can be controlled by the parent company in another member state is not enough to rebut the presumption laid down by the Regulation."
"47. While the Regulation does not provide a definition of the term "centre of a debtor's main interests", guidance as to the scope of that term is, nevertheless, as the court stated in Eurofood, para 32, to be found in recital 13 in the Preamble to the Regulation, which states that "the 'centre of main interests' should correspond to the place where the debtor conducts the administration of his interests on a regular basis and [which] is therefore ascertainable by third parties".
48. As the Advocate General observed at point 69 of her opinion, the presumption in the second sentence of article 3(1) of the Regulation that the place of the company's registered office is the centre of its main interests and the reference in recital 13 in the Preamble to the Regulation to the place where the debtor conducts the administration of his interests reflect the European Union legislature's intention to attach greater importance to the place in which the company has its central administration as the criterion for jurisdiction.
49. With reference to that recital, the court also stated in Eurofood, para 33, that the centre of a debtor's main interests must be identified by reference to criteria that are both objective and ascertainable by third parties, in order to ensure legal certainty and foreseeability concerning the determination of the court with jurisdiction to open the main insolvency proceedings. That requirement for objectivity and that possibility of ascertainment by third parties may be considered to be met where the material factors taken into account for the purpose of establishing the place in which the debtor company conducts the administration of its interests on a regular basis have been made public or, at the very least, made sufficiently accessible to enable third parties, that is to say in particular the company's creditors, to be aware of them.
50. It follows that, where the bodies responsible for the management and supervision of a company are in the same place as its registered office and the management decisions of the company are taken, in a manner that is ascertainable by third parties, in that place, the presumption in the second sentence of article 3(1) of the Regulation that the centre of the company's main interests is located in that place is wholly applicable. In such a case, as the Advocate General observed at point 69 of her opinion, it is not possible that the centre of the debtor company's main interests is located elsewhere.
51. The presumption in the second sentence of Article 3(1) of the Regulation may be rebutted, however, where, from the viewpoint of third parties, the place in which a company's central administration is located is not the same as that of its registered office. As the court held at [34] of Eurofood, the simple presumption laid down by the EU legislature in favour of the registered office of that company can be rebutted if factors which are both objective and ascertainable by third parties enable it to be established that an actual situation exists which is different from that which locating it at that registered office is deemed to reflect.
52. The factors to be taken into account include, in particular, all the places in which the debtor company pursues economic activities and all those in which it holds assets, in so far as those places are ascertainable by third parties. As the Advocate General observed at [70] of her opinion, those factors must be assessed in a comprehensive manner, account being taken of the individual circumstances of each particular case.
53. In that context, the location, in a Member State other than that in which the registered office is situated, of immovable property owned by the debtor company, in respect of which the company has concluded lease agreements, and the existence in that Member State of a contract concluded with a financial institution - circumstances referred to by the referring court - may be regarded as objective factors and, in the light of the fact that they are likely to be matters in the public domain, as factors that are ascertainable by third parties. The fact nevertheless remains that the presence of company assets and the existence of contracts for the financial exploitation of those assets in a Member State other than that in which the registered office is situated cannot be regarded as sufficient factors to rebut the presumption laid down by the EU legislature unless a comprehensive assessment of all the relevant factors makes it possible to establish, in a manner that is ascertainable by third parties, that the company's actual centre of management and supervision and of the management of its interests is located in that other Member State."
"17. Although decided early in the life of the EC Regulation and in the context of individual rather than corporate insolvency, Shierson v Vlieland-Boddy [2005] EWCA Civ 974 still contains valuable guidance on matters relevant to the search for a debtor's centre of main interests. The following propositions from the judgment of Chadwick LJ (largely to be found in paragraphs 47 and 55) seem to me to be relevant here:
(a) An individual (and presumably a company too) is free to change his or its centre of main interests, even for a self-serving purpose.
(b) If a debtor shifts his centre of main interests in the face of possible insolvency, the court must scrutinise the facts and determine whether the change is one of substance or illusory.
(c) Regard must be had to the need for the centre of main interests to be ascertainable by third parties, in particular creditors and potential creditors.
(d) Whilst the date on which a debtor's centre of main interests is to be established is the date of presentation of the petition, evidence as to a debtor's activities and actions at other times may be significant to the extent that they cast light on the truth or otherwise of any claim to have had a centre of main interests in a particular location at the relevant time.
(e) A change of centre of main interests must have an element of permanence."
"22. This is a case about forum shopping. The petitioner seeks a winding up order here because it is easier, quicker and less costly to do here than it would be in Malta. That is understandable but is not a factor I can take into account. The company has plainly moved its registered office to Malta for precisely that reason: it wishes to avoid or put off being wound up, even though it cannot pay the petitioner's undisputed judgment debt or, it seems, debts due to other creditors. I draw that conclusion from the timing of the move of the company's registered office … The company's explanation that the reason for the move to a country with which it had no prior connection was to save overheads makes no sense without amplification; there appears to have been no attempt to notify any third party of the move: no evidence is given of the company's having done so; on the contrary, … the company continued to use a BVI address after the move ... As we know from Shierson v Vlieland-Boddy, a debtor is entitled to move his centre of main interests and to do so for self-serving reasons. The question is whether the move is real or illusory.
23. As the Court of Appeal said in Shierson v Vlieland-Boddy, the court must scrutinise an apparently suspicious shift of a debtor's centre of main interests to establish which is the case. That it is obliged to do so is plain from recitals 27, 30 and 32 of the EU Regulation."
"28. I reject [counsel for the Company]'s suggestion that where ascertaining the company's centre of main interests is difficult, as it is in this case, the court can avoid the inquiry it is mandated to undertake by using the registered office presumption to make a default finding. There is a difference between applying a presumption and making a finding by default. It may be that in reality, in many situations, the registered office in fact operates as a default basis on which jurisdiction is established, for example where the petitioner asserts a jurisdictional position and the company does nothing to challenge it and no other creditor raises a doubt about it; but that is not the position here … In my judgment, when faced with competing claims, the court must inquire into the basis on which its jurisdiction is being invoked (or contested) and reach a principled decision on the evidence as opposed to using the registered office presumption as a fall back to avoid having to do so. The EU Regulation is not framed as [counsel for the Company] would have it. It could have been if the legislators had intended the registered office presumption to work in the way he suggests."
"35. Locating the company's centre of main interests in Malta rests on its registered office being there and no more than that. There is unchallenged evidence from the petitioner that there is no operational office and no one conducting the business of the company there. The registered office is a "letter box" and no more. It follows that if the company "conducts the administration of its interests on a regular basis elsewhere" such that that "is ascertainable by third parties", that "elsewhere" can only be either the UK or Switzerland."
"54. I conclude on the basis of the documentary material, the location of the company's banking facilities from time to time, the location of its legal advisers, the location of at least one judgment creditor to which a debt was to be paid and the place where the company was involved in litigation that at the relevant time the company was administering its interests in both the UK and Switzerland so that both were centres of the company's interests. I conclude, by a narrow margin and with misgivings, that on balance the greater use of English law for contracts, the greater use of London as a seat of arbitration, the actual recourse to or forced involvement in legal proceedings here and the consequential use of English lawyers makes the UK, on the balance of probabilities, the main centre of those interests. The company's affairs seem to have been conducted in this country more than in Switzerland, certainly as far as contractual and litigation interests were concerned, although it is, I accept, hard to be precise."
"55. As to ascertainability, I agree with [counsel for the Petitioner] that what is required by the Regulation is just that, not actual ascertainment at the relevant date. I make the obvious observation that the petitioning creditor, a third party, has in fact ascertained the company's centre of main interests and done so in the face of a cloud of obscurity. I also note, as Lewison J did [in Lennox Holdings plc [2009] BCC 155 at [7]], that ascertainability by third parties of the centre of main interests is not central to the concept of the centre of main interests but seems to flow from the fact of where the interests lie; and that in Irish Bank Resolution Corporation Limited v Quinn [2012] NI Ch 1, Deeny J said,
"[A] debtor does not appear to be obliged to advertise his centre of main interest but nor may he hide it. It should be reasonably or sufficiently ascertainable or ascertainable by a reasonably diligent creditor" (paragraph 28).
Whilst the fact of the company's registered office being in Malta was and remains, as [counsel for the Company] rightly says, ascertainable from public records, the fact that its centre of main interests was and remains in the UK was and still is similarly ascertainable, albeit less readily, by one reasonably diligent creditor and could be by others."
The Judgment of Mr. Justice Miles
"56. …. First, the principles of legal certainty and foreseeability require that the centre of main interests should be capable of ascertainment by reference to publicly available objective features. The applicable insolvency law will generally follow the rules on jurisdiction, and creditors generally should be able to predict which insolvency law will apply from ascertainable features without having to make more detailed enquiries. For this reason the right perspective is that of typical third parties.
57. Second, in the case of corporate debtors there is, of course, the statutory presumption that the centre of main interests is in the place of the registered office. The place of a registered office is a fact in the public domain. Creditors can, therefore, assume, absent other factors which are ascertainable, and which point the other way, that the centre of main interests will be in that place.
58. Third, a corporate debtor may move its registered office, including for self-serving reasons. There is protection within the regulation itself against changes within three months of the request to open insolvency proceedings. Equally, the presumption based on the place of the registered office may be rebutted by other evidence. It is likely to be easier to rebut the presumption, where the registered office may be seen as a letterbox, rather than the place of actual administrative conduct. However, it does not follow, even in such cases, that there is no presumption. Part of the reason for the presumption is to enable creditors to be able to predict, with reasonable certainty, which insolvency law is likely to be applicable, in the event of the insolvency of their counterparty. Creditors are therefore able to base their expectations on the place of the registered office unless there are objective pointers going the other way. It is clear from the Eurofood case that although, in the case of a letterbox office, the presumption may be more readily rebutted, it nonetheless remains a real presumption.
59. Fourth, the burden is on a party seeking to rebut the presumption to show that there is another place where the debtor conducts the administration of its interests on a regular basis. That again seems to me to flow from the principles of certainty and foreseeability.
60. Fifth, the focus is on the place where the interests of the debtor are being administered, not where it happens to operate commercially (though these may be relevant to determining the former).
61. Sixth, the matter has to be examined at the date of the petition. Earlier or later events may be relevant, but only in so far as they may throw helpful light on the position as at that date.
62. Seventh, the centre of main interests of a debtor may change, but the concept of COMI connotes a degree of permanence. It would be inimical for the purposes of the concept and the rules in which it is embodied if the centre of main interests could fluctuate too easily depending on the place where things happened to be occurring from time to time."
"65. … The company had its registered office in Malta. Its creditors could have ascertained that by inspecting the register. By virtue of Article 3(1), Malta was presumed to be the centre of main interests, in the absence of proof to the contrary on the basis of ascertainable factors.
66. The judge appears to have considered that because there was no evidence of any actual administration in Malta, it should be disregarded, so that the court had to search (doing the best it could) for the best possible alternative candidate. That, it seems to me, is wrong in principle. The registration of the office in Malta was a real fact. Indeed, counsel for the petitioner accepted that the presumption did arise, and the fact that, as he put it, the company's office was no more than a letterbox, went to the strength of the presumption, rather than its existence.
67. As already explained, the judge treated the registration of the office in Malta as "illusory". Again that is wrong: the company was undoubtedly registered there. In my view the judge failed to appreciate the importance given by the Recast Regulation to the place of a registered office, and the reason for the statutory presumption. The registered office is stated on a public register, which is open to public inspection, and a company's creditors are, therefore, prima facie, able to rely on it, in order to predict the applicable insolvency law in the event of the company's insolvency."
"68. The second related flaw in the judge's reasoning is his approach to ascertainability. A leitmotif of the European jurisprudence is that only those features of a debtor's administration of its interests which are readily identifiable by third parties will be relevant for determination of its centre of main interests. That, again, is because of a need for legal certainty and foreseeability. Unfortunately, the judge was not referred to the Stanford case, which emphasised this point (and held that Re Lennox was wrong to suggest otherwise). When the judge ascertained the various connecting factors, such as the governing law or the contracts for the company's banking arrangements, he did not go on to examine the further question whether such aspects of the company's business were ascertainable, in the sense of being available to typical third parties of the company, without further enquiry.
69. To my mind, the judge's error is well illustrated by his comment in paragraph 55, that the petitioner had ascertained the company's centre of main interests in the face of a cloud of obscurity. He said that it had been discovered by a reasonably diligent creditor (the petitioner). The judge was referring there to the petitioner reaching that conclusion in the light of all of the evidence that was before the court, including evidence, for example, about the banking contracts and the various contracts that had been disclosed in the course of the proceedings. There is no reason to suppose that those matters would have been ascertainable to typical creditors of the company, and the judge did not address that question separately."
"71. The third flaw in the judge's reasoning is that he failed properly to distinguish between the matters of the administration of the company, on the one hand, and matters of the operations of its business on the other hand. It seems to me that a number of the factors he relied upon, such as the proper law of the contracts and the seat of any potential arbitration, and the employment of lawyers in relation to litigation in various countries, are matters going to the operations of its business, rather than the place of the administration of its interests.
72. This seems to me to have arisen because of his conclusion, reached at an early stage in the analysis, that the administration of the company's interests was not happening in Malta (see above). He therefore concluded that the company's business must in fact have been administered somewhere else, and then, basing himself on such evidence as there was about the affairs of the company, concluded that the company's business must have been administered in the same place as its business was operating."
"87. It is also significant that the contracts were with particular creditors. There is no reason to think that the choice of law clauses or dispute resolution clauses contained in them were publicly and readily ascertainable by typical third-party creditors of the company."
"… I also do not see how it could be said that typical third-party creditors of the company could ever have been aware of the reference to London in the contract. It seems to me that this factor is therefore exiguous."
"In any event there is no reason to think the typical third-party creditors of the company would be aware of disputes of that kind or place any weight on it."
"93. Moreover, there is again the question of ascertainability and the position that would have been known to typical third parties dealing with the company. There may be cases where the great bulk of the creditors of the company are to be found in a particular state, and that may throw light on where the company is being administered from. However, the point being relied on here was merely the particular debt owed to the petitioner itself. That does not assist in rebutting the statutory presumption."
The arguments on the appeal
i) That Judge Baister had been right to regard the registered office of the Company in Malta as a mere "letter box", and to conclude that the change in registered office from the BVI to Malta had been made by the Company to avoid, or put off, being wound up. Judge Baister was right in these circumstances to regard the presumption to which the location of the registered office gave rise under Article 3(1) as "illusory", or at least as having little or no weight in the determination of the Company's COMI. Miles J had not considered how much specific weight to give to the presumption in these circumstances, and/or had wrongly given it too much weight.
ii) That Miles J was wrong to limit his assessment of the factors relevant to the determination of COMI to those facts which he considered would have been apparent to a (hypothetical) typical third party dealing with the Company. This meant that he placed insufficient weight upon the factors which were actually apparent to, or had been discovered by, the Petitioner, which was a real creditor which had dealt with the Company.
Analysis
The presumption under Article 3(1)
Ascertainability
"19. …as regards the term "centre of main interests" in article 3(1) of [the First EU Insolvency Regulation], the court has held that the scope of that term is clarified in recital (13) of that Regulation, which states that "the 'centre of main interests' should correspond to the place where the debtor conducts the administration of his interests on a regular basis and is therefore ascertainable by third parties". The court has concluded that that definition shows that the centre of main interests must be identified by reference to criteria that are both objective and ascertainable by third parties. That objectivity and that possibility of ascertainment by third parties are necessary in order to ensure legal certainty and foreseeability concerning the determination of the court with jurisdiction to open main insolvency proceedings (order in Leonmobili, para 33 and the case law cited).
20. The same interpretation must be used to determine the meaning and the scope of the term "centre of main interests" for the purposes of [the EU Regulation]. As Advocate General Szpunar stated in point 29 of his opinion … the use of objective criteria remains essential in order to ensure legal certainty and predictability as regards the determination of the court having jurisdiction. In addition, the rules on international jurisdiction laid down in [the EU Regulation], as is stated in recital (5), aim to avoid incentives for parties to transfer assets or judicial proceedings from one member state to another, seeking to obtain a more favourable legal position to the detriment of the general body of creditors.
21. Recital (28) of [the EU Regulation] also provides useful clarification in that respect by stating that, when determining whether the centre of the debtor's main interests is ascertainable by third parties, special consideration should be given to the creditors and to their perception as to where a debtor conducts the administration of his or her interests. The use of objective criteria which can be ascertained by third parties in order to determine the centre of the debtor's main interests must make it possible to determine the jurisdiction with which the debtor has a genuine connection and thus meet the legitimate expectations of the creditors."
"… the contracts were with particular creditors [and] there is no reason to think that the choice of law clauses or dispute resolution clauses contained in them were publicly and readily ascertainable by typical third-party creditors of the Company."
Miles J gave similar reasons when dealing with other factors at [89], [90], [91] and (to a lesser extent) [93].
"What is ascertainable by third parties is what is in the public domain, and what they would learn in the ordinary course of business with the company."
"… In my view [the decision of the ECJ in Eurofood] clearly established the following propositions:
…..
(2) It is clear from paragraph 34 of the judgment of the ECJ that the presumption 'can be rebutted only [by] factors which are both objective and ascertainable'. That this test is not the same as the head office functions test adopted by Lewison J in Re Lennox Holdings and Lawrence Collins J in Re Collins & Aikman Corp Group [2006] BCC 606 para 16 is plain….
(3) Thus it is conclusively established that the factors relevant to a rebuttal of the presumption must be both objective and ascertainable by third parties. Lewison J [at first instance] confined factors ascertainable by third parties to matters already in the public domain and what a typical third party would learn as a result of dealing with the company and excluded those which might be ascertained on enquiry. The good sense of this conclusion is demonstrated by the cases in English domestic law relating to constructive notice and its various degrees, see, for example, Baden v Societe Generale SA [1993] 1 WLR 509, 575 paras 250-274. To extend ascertainability to factors, not already in the public domain or apparent to a typical third party doing business with the company, which might be discovered on enquiry would introduce into this area of the law a most undesirable element of uncertainty.
(4) Whether or not factors, not already in the public domain or so apparent, ascertainable on reasonable enquiry are relevant to a rebuttal of the presumption, that cannot extend the range of ascertainable factors to the fraudulent Ponzi scheme. That, inevitably, is neither a matter of general knowledge nor ascertainable on reasonable enquiry. It was suggested that after the fraudulent scheme had been uncovered the facts as to its previous existence had become public knowledge and should be relevant to the rebuttal of the presumption. No doubt the COMI of a company may change as the situation of its registered office may change, but it can only do so by reference to main interests which it still has and facts within the public domain or so apparent at the time of their occurrence. The allegations of fraud have not yet been proved before a court of competent jurisdiction …, SIB's interests main or otherwise ceased on discovery of the alleged fraudulent scheme and the activities now said to rebut the presumption were not in the public domain or so apparent when they occurred.
…"
"49. … [the] requirement for objectivity and that possibility of ascertainment by third parties may be considered to be met where the material factors taken into account for the purpose of establishing the place in which the debtor company conducts the administration of its interests on a regular basis have been made public or, at the very least, made sufficiently accessible to enable third parties, that is to say in particular the company's creditors, to be aware of them."
The alternative formulation at the end of this paragraph does not suggest that the CJEU regarded it as essential that a material factor should have been made public, provided that it was at least accessible to third parties.
Miles J's decision on the evidence
Disposal
Sir Launcelot Henderson:
Lord Justice Lewison:
"This leads on to the next question: what is meant by "ascertainable"? Mr. Isaacs submitted that information would count as being ascertainable even if it was not in the public domain if it would have been disclosed as an honest answer to a question asked by a third party. Provided that a third party asked the right questions, and was given honest answers, the result of the inquiry would be ascertainable. Mr. Zacaroli submitted that this formulation was far too wide and blurred the distinction between what was ascertainable and what was not. On the basis of Mr. Isaacs' submission the requirement of ascertainability was diminished almost to vanishing point. Rather, what was ascertainable by a third party was what was in the public domain, and what a typical third party would learn as a result of dealing with the company. I agree with Mr. Zacaroli. As Chadwick LJ says, one of the important features is the perception of the objective observer. One important purpose of COMI is that it provides certainty and foreseeability for creditors of the company at the time they enter into a transaction. It would impose a quite unrealistic burden on them if every transaction had to be preceded by a set of inquiries before contract to establish where the underlying reality differed from the apparent facts."