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Specialist High Court Enforcement for Lotus F1

21 April 2020

This blog post is the part of a series profiling Chris Badger AHCEO, our legal and compliance director, who possesses extensive experience managing specialist and high profile cases on behalf of the Royal Courts of Justice. If you require the services of a High Court Enforcement Officer or would like to receive specialist advice for an upcoming case, please contact Just today on 020 3848 9060


 

A few years ago, I worked a case related to the seizure of some highly specialist goods belonging to a Formula One team. 

The team in question was Lotus F1. Lotus was a former British Formula One Racing Team who competed between 2012 and 2015, were based in Enstone, Oxfordshire and at the time of the case appeared to be in some financial difficulty.

We were instructed by a creditor who had undertaken some work as a paid service but had experienced the non-payment of an invoice.

As a result, our team were instructed to enforce against Lotus F1 and this resulted in an attendance to their main office to take control of goods and enforce the payment of the unpaid debt to the creditor.

This occurred at a midway point in the Formula One season, during the lead up to the Japanese Grand Prix. 

Enforcement Visit: Engagement & Selective Seizures 

This meant that when we attended the factory, most of the team, the race cars and specialist equipment had already been shipped off to Japan, which was something that often complicates matters in high value enforcement cases of this kind.

Our enforcement agents spent a lot of time discussing the situation with the staff who remained at the site. I’m pleased to say they weren't obstructive and if I am honest they were they were quite helpful in the matter.

It was relatively clear that the company and the team were in some financial difficulty, but we did identify were a number of inconspicuous storage containers discreetly marked “ship to Japan”.

As a result, the enforcement agent decided that in the absence of other goods of value it would be a good idea to seize those two crates specifically, which proved an inspired move as within those two crates we found items that were, in effect, their spare parts.

Once we had seized these items, we then engaged in a dialogue with the legal team of the defendant company who understandably wanted to ensure that the spare parts could be shipped to Japan from our Jurisdiction in England and Wales.

As a result of these negotiations, we did agree to release the crates so that they could be shipped in time for the race, but that was with consent.

We had to give explicit permission for the parts to be used on the race cars during the race weekend because when this scenario occurs, the defendant can only utilise the assets with the permission of the High Court Enforcement Officer. 

So, I am pleased to say that the race weekend went ahead as planned in this case. 

What happened next was not unexpected but resulted in a great deal of further work for our team in order to successfully recover the debt owed to our claimant.

Post Enforcement: Administration, Third Party Claims & Conclusion 

Immediately after the race weekend, Lotus F1 announced it was entering into administration and when that happens as a high court enforcement officer you then have to liaise with the appointed insolvency practitioner or liquidators or administrators.

It was then my responsibility to deliver the seized assets to the insolvency practitioner dealing with the affairs of the failed company. So we promptly engaged with the administration team and explained the full details of the case. 

However, during this period we were met with a number of third-party claims to various parts and items that we've seized from a number of other Formula 1 teams including McLaren F1 and Red Bull Racing.

In the event, we actually submitted a number of these additional claims against Lotus F1 also. So in effect at this point we were in quite extensive dialogue with the administration team and each of these additional claims then went through the standard process.

As for the spare parts, we retained responsibility for these items and were able to successfully deliver them to the insolvency practitioners with due care for their condition such that they were able to retain their value as a specialised asset for resale.  

However, we were able to negotiate this on the condition that the insolvency practitioners were able to pay the fees of the high court enforcement officer, as a first charge on any monies recovered, which they do.

At this point, our team had brought the case to a successful conclusion. We were able to recover unpaid debt on behalf of the original creditor. 

The administration team went on to take charge of affairs, enabling Lotus F1 to race for the remainder of that season and in the event successfully stewarding the company before it was acquired by Renault and reincarnated, in effect, as the Renault F1 Team.

Want to hear more from Chris Badger? Find out How To Seize A Boeing 767 using a High Court Writ 


Chris Badger AHCEO is a regular speaker at industry events and can provide specialist advice on how to best enforce complex and high value writs of execution under the authority of the High Court of England and Wales.

If you require the services of a High Court Enforcement Officer for a specialist case, please contact Just today on 020 3848 9060