Neutral Citation Number: [2008] EWHC 2335 (Ch)
IN THE HIGH COURT OF JUSTICE
COMPANIES COURT

St. Dunstan’s House
Monday, 22nd September 2008

Before:

MR. JUSTICE MORGAN
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B E T W E E N :

(1) RAB CAPITAL PLC
(2) RAB CAPITAL MARKET (MASTER) FUND	         Applicants

-  and -

LEHMAN BROTHERS INTERNATIONAL (EUROPE)	            Respondents

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Mr Mortimer and Mr Gledhill (instructed by Simmons & Simmons ) appeared on  behalf of the Applicants.

Mr Trower and MrBaker (instructed by Linklaters) appeared on behalf of the Respondents.

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J U D G M E N T
MR. JUSTICE MORGAN:  

1      In view of the time (7.45pm), and in view of any precedent creating effect of my decision, I think I will announce my decision and give the basic strands of the reason but not do more.  If someone wants to take my decision to the Court of Appeal then I will give my reasons in more detail later without,          I think, much delay.  

2	The application before me tonight is that the intended application by the Applicant for directions to be given by the court to the administrators, should be listed to be heard this Friday, 26th September, on an urgent basis with a time estimate of half a day.  I am going to refuse to make that order.  

3	The circumstances of this administration are unusual.  They have been described to me in great detail by counsel for the administrators.  I have very considerable sympathy for the position of the Claimant.  For a considerable time during the argument I was more than willing to give the court’s assistance to help the Claimant in its difficulty.  

4	There are two factors that have persuaded me not to do that.  The first is that the administrators as officers of the court have the job of appraising the claim, dealing with it, and giving effect to such rights as are clearly established.  I do not myself see this present claim in court as involving very much by way of legal issues.  It strikes me it is very much more a case of administering an application for the return of what appears, overwhelmingly at the moment, to be the assets of the Claimant.  There will be others who will be making similar claims.  It is the job of the administrators to process those.  It is not the job of the judges of the High Court to take on that burden.  

5	Of course, when the first application of this kind is made, when the grounds appear to be very strong, a judge is very tempted to do justice in the individual case, but I am concerned about the precedent effect of giving this relief.  The floodgates argument has been referred to, I think appropriately so, and it seems to me, from the material I have, that it is very likely indeed that if I give this relief tonight it will be the first of very very many, which will be a considerable difficulty for the court to deal with, and in any case it is not the courts that should deal with these matters in the first instance, it is the administrators as officers of the court.  

6	The second matter is that when one tries hard to meet a very proximate time limit, as is the case here, a hearing on Friday, to get a decision on Friday, and in any event before 1st October, one’s ambitions are often derailed by small points on the facts of the individual case.  There does appear to be a point here that could derail all ambitions of getting a decision on Friday, which could be taken advantage of by the Claimant on 1st October.  That is that on the information available it looks very likely as if the English company (in administration) is not the de facto custodian of the relevant assets.  Those assets are in New York where the sub-custodian is an American company in liquidation.  The American company has already been requested to return these assets to the English subsidiary in administration and that has not yet produced a return of the assets.  So even if we all ran very fast, tried very hard, and the Claimant did get an order against the English company, it would have to be that the English company did what it could to get the assets from the United States, and that might just repeat today’s problem for a second time, but this time dealing with the company in the United States in liquidation and under a different legal code.  

7	Those are short reasons only.  I have not attempted to describe or narrate the circumstances of the case, but I hope that in fairness to the parties they indicate the reasons that in the end have weighed with me.  That is my decision.