Stephen Louis Nardelli & Anor v Desiman Limited

Sir Anthony Mann: Introduction and factual background

1. This is an appeal of Mr Johnson and Mr Nardelli from an order and judgment of ICCJ Mullen made and delivered on 13th September 2024. On that occasion the judge made a bankruptcy order against both gentlemen. He also dismissed applications to extend the time for paying a prior costs order and for the filing of evidence and vacated future hearings in the bankruptcy proceedings. Mellor J gave permission to appeal on 9th April 2025.

2. The bankruptcy debt was based on a joint guarantee that the appellants gave in favour of the respondent Desiman Ltd (“Desiman”) in support of a substantial principal debt owed to Desiman by P3Eco (Bicester) Himley Ltd (“Eco”). The debt and limit on the guarantee was increased from time to time in manner that does not matter; on 8th March 2019 the cap on the guarantee was £500,000 and it remained there. There was another principal debtor (Portfolio Property Partners Ltd) but it is unnecessary to complicate the narrative by referring to that company; it will be sufficient to focus on Eco as the principal debtor.

3. The debt arose in the context of lending for the development of land at Bicester. Eco gave a fixed charge over land in support of the lending, together with a floating charge. It is the fixed charge that is relevant to this appeal.

4. The journey to the bankruptcy and other orders involved some prior orders which are important background. On 28th January 2022 formal demand was made under the lending facility and on 25th February 2022 administrators were appointed by Desiman over the charged land. While relationships between the appellants and Desiman were cordial for a time after the appointment of administrators, they soured somewhat thereafter and on 5th May 2023 a demand was made under the guarantee. Statutory demands followed on 24th May 2023 in the sum of £507,616.40. The excess over the £500,000 was said to be attributable to accruing interest since the demand.

5. An application to set aside the demands was made and on 13th March 2024 ICCJ Greenwood dismissed the applications. He rejected a challenge to the amount due on the basis that it was no more than “pure Micawberism … I think this is a paradigm case of a cloud of objections being raised in the hope that something might at some point turn up if a sufficient number of questions are asked.” He then rejected the other ground based on an allegation that Desiman were seeking to abuse the process by using the bankruptcy procedure to suppress an application that the appellants had made to remove the administrators of Eco. He regarded this as having even less in it than the first point (paragraph 64). Having dismissed the applications he then ordered that the appellants pay Desiman’s costs of £33,500 by 10th April 2024. It was never paid.

6. Bankruptcy petitions were then presented and served on 19th April 2024. They came before ICCJ Prentis on 31st May 2024. The debtors sought to defend the petitions on the basis that the petition debt was disputed, that Desiman was preventing or frustrating payment and on the basis that the debtors had a cross-claim against Desiman based on the circumstances giving rise to an application to remove the administrators of Eco which had by then been made. ICCJ Prentis gave directions for a contested hearing, which was in due course listed for 2nd April 2025. The £33,500 costs order was unpaid at this point, and ICCJ Prentis considered that the debtors were choosing not to pay rather than being unable to pay, so he made an order that unless they paid that sum by 5th July 2024 then “the Debtor shall not take any further steps in the Petition without the court’s permission”. In his judgment ICCJ Prentis anticipated that they might not pay and observed that if they came back to court to “resurrect their defences, or whatever” that would “obviously have to be with a full explanation of why the sums were not paid in due time, what other dispositions had been made and what other liabilities were incurred, and that sort of thing”. He also made an order that the debtors should file their evidence on the petition by the same date.

7. On the last day of the period for payment and evidence the debtors applied for an extension of time for payment under the unless order to 2nd August 2024 and for the provision of evidence to 30th August 2024. According to the judgment under appeal there was an agreement in principle for the extension of the money part of the order (it is not clear about the evidence part, but that no longer matters) but then the debtors changed their mind and said that payment would have to wait until they had made a specific disclosure application in their application to have the administrators removed. By the time the matter came before ICCJ Mullen the extension application was listed for a hearing on 18th November 2024.

8. The initial listing of that application for disclosure was for 20th November 2024, which would have been useless because it was after the trial date for the application itself which was scheduled for October. At a time that ICCJ Mullen described as “fairly belatedly” (a description disputed on this appeal by the appellants), it was re-listed for a date in the week following the hearing before him. That would have allowed for it to be determined before the hearing in October.

9. On 30 th August 2024 Desiman issued an application seeking an order that in the light of the failure to comply with the unless order deadline in relation to the payment of the money (as extended) a bankruptcy order ought to be made. In effect it sought the acceleration of the hearing which would otherwise have taken place on 5 th April 2025. That was the application which arrived before ICCJ Mullen. As the matter arrived before him the position was therefore that the order of ICCJ Prentis had not been complied with and the debtors had not filed their evidence on the petition and were debarred from taking any steps in the petition without permission. Strictly speaking the debarring order probably applied to the filing of evidence, but Mr Johnson apparently filed some late evidence which included a report from the administrators. The judge below apparently accepted this evidence; it is not apparent that its introduction was objected to on the basis that it was late and filed without permission.

10. On this appeal Mr Kevin Pettican appeared for the debtors (he did not appear for them at the hearing below); Mr Robert Amey appeared for Desiman (as he did below). The judgment below

11. As appears above, when the petition re-surfaced before ICCJ Mullen he made a bankruptcy order. His short judgment plotted the following course.

12. He started by describing the course of the proceedings in general terms and recorded, in general terms, the nature of the then outstanding application to remove the administrators. In paragraph 4 he recorded the “striking” feature of the specific disclosure application being returnable for a date after the actual hearing of the application and further recorded the submission of Mr Amey for the petitioner that the debtors were indulging in delaying tactics. He then recorded (paragraph 5) the petitioner’s case that the debtors were debarred from defending the petition and that the debtors were indulging in expensive litigation (presumably the removal proceedings) and diminishing their assets in circumstances in which it was inevitable that bankruptcy orders would be made. At paragraph 6 he records the important submission that the debtors were seeking to re-raise matters which had been dealt with on the hearing of the applications to set aside the statutory demands. The notice of opposition raised a challenge to the debt, which had been dealt with and dismissed on that earlier occasion. Insofar as new matters were being raised then they ought to have been raised before ICCJ Greenwood.

13. In paragraph 8 ICCJ Mullen accepted the submission of the petitioners that the application to extend time made by the debtors was inevitably going to be dismissed because the evidence on it did not address the factors that ICCJ Prentis indicated were going to have to be addressed in such an application. Such evidence as had been put in did not address those issues at all (paragraph 8). The application, in its circumstances, could be seen to have all the hallmarks of the debtors shifting their ground to try to push the deadline back as far as possible. In paragraphs 13 and 14 he recorded: “13. I am entirely confident that a judge hearing the application to extend time would see it for what it is and would not grant any further time. The respondents would therefore be unable to take further steps in the proceedings without the permission of the court. It seems to me that, unless and until the costs had been paid, the court would not grant such permission. There is no evidence that they can be. The application to extend time for filing of evidence would therefore similarly fail.

14. All that, as I have said, is against a background where there does appear to me to be an attempt to revisit matters that either were ventilated before ICC Judge Greenwood at the statutory demand stage or should have been so ventilated. There is simply no reason why it could not have been.”

14. Then he turned to consider whether a bankruptcy order should be made on that day on the basis that the debtors were debarred from taking further steps to defend the petition because their applications for an extension of time must fail (paragraph 15). He referred shortly to the question around which Mr Pettican principally framed this appeal, namely the possibility of payment of the principal debt, saying that counsel submitted that “there are indications that the companies will be able to meet their obligations in full. A further tranche of consideration in the sum of £10 million is due on the face of [a report of the administrators] to come in next year.” I will amplify that matter in due course.

15. In paragraph 16 he recorded the likelihood of disruption of the administration were the administrators to be removed and its potential adverse effect on the repayment of the principal debt in full and then reached his final decision in paragraphs 17 and 18: “`17. However that may be, there is a liability that has fallen due for payment in the sum of at least £500,000 under the guarantee. It has not been paid. There is an obligation on the part of the debtors to make payment under the guarantee and it is not sufficient for them to say that, in due course, there may be a payment in full coming from the associated companies some time next year. The point of a guarantee is to ensure prompt payment when the principal debtor defaults. On the evidence that I have there is no sufficient prospect of the debt being paid within a reasonable time or at all.

18. In my judgment, it is appropriate to make a bankruptcy order today. The whole conduct of these petitions on the part of the respondents does have a strong flavour of an attempt to delay and obfuscate. The failure to meet the costs directed to be paid by ICC Judge Prentis is deliberate and one can see from the change in stance over the course of the application for an extension of time to pay that the respondents are content to shift their position as required to avoid having to comply with the order. They have had ample time to produce their evidence. It also seems to me wholly unsatisfactory to pin their response to their specific disclosure application as an excuse to avoid addressing the evidence of the petitioner on the petitions in any way. In my judgment, these petitions should not be allowed to roll on until the hearing in April next year where (a) the outcome of that hearing seems to me to be inevitable and (b) in the meantime the debtors will continue to dissipate their own assets in litigation that also appears to be being conducted in an unsatisfactory way.” (my emphasis of an important word in this appeal) The emphasis in that paragraph is to demonstrate the word around which the principal issue in this appeal revolved.

16. The judge therefore made a bankruptcy order and the other orders referred to above. The Grounds of Appeal

17. The grounds of appeal are set out in the Annexe to this judgment. Mr Pettican took the fourth ground first, and concentrated on that, and I will do the same. Ground 4

18. The essence of this Ground is that the judge should have appreciated and given full effect to some evidence that the principal debt would be repaid by 21st February 2025 at the latest, and since that would be prior to the adjourned date for disposing of the petition (2nd April 2025) it was wrong to say that it was “inevitable” that the principal debt would not be repaid by that disposal date (see the use of that word in paragraph 18 of the judgment). To understand that requires an exposition of some further matters that were before the judge below, though the force with which they were advanced is a matter of some dispute.

19. What was before the judge for these purposes was the petitioner’s application for a bankruptcy order prior to April 2025 (when the matter was otherwise listed) on the footing that the debtor had failed to comply with the directions of ICCJ Prentis, were thereby debarred from defending (as it was recorded by ICCJ Mullen) and that therefore the bankruptcy order ought to be made by him earlier than might otherwise have been the case.

20. On the day of the hearing before ICCJ Mullen Mr Johnson filed and served a relatively short witness statement which was made available to the petitioner only an hour or so before the hearing (I was told). It made a point about the forthcoming disclosure application in the removal application, and then had a section headed “Further issues for consideration”. “Briefly” (the introductory word used) it pointed to the latest progress report from the administrators which it was said confirmed that the Desiman debt would be fully redeemed out of the last payment of deferred consideration due under a sale of the land charged to Desiman. That last payment was £10m, and is the payment referred to in the citation from paragraph 15 of the judgment below. The witness statement says that Desiman’s own figure (which the debtors did not accept but which they assumed was accurate for the purposes of this point at the hearing) was (as at February 2024) a little over £9m. Paragraph 4.2 of the report anticipated that on the final payment of this consideration (which is known to have been £10m) Desiman would be repaid and there would be some sort of surplus for a second chargee (an entity known as Brooke).

21. Mr Pettican’s central point on this appeal is that this factor should have been a key factor in the judge’s deciding whether or not to make a bankruptcy order when he did. He should have had high regard to the fact that by the time of the adjourned hearing of the petition (April 2025) the principal debt would, on the evidence, have been paid off and he should not have treated a bankruptcy order as “inevitable”.

22. For a point which is now so central to this appeal it was raised in a surprisingly low key manner at the hearing below. It appeared in last minute evidence along with other matters, and was raised “Briefly” and shortly in the evidence. It is apparent from the judgment of ICCJ Greenwood that the debtors had known about the contract to sell the land and that instalments of consideration were due, so the point being raised at the last minute is surprising. It was hardly referred to in oral submissions. It was referred to briefly in one sentence as the second of two afterthoughts when counsel had taken instructions at the end of his planned submissions as to whether he had missed something. If it is the case that the judge missed its significance (though I do not consider that he did) then that would not be at all surprising.

23. Nonetheless Mr Pettican is entitled to maintain his submissions about whether the result of the April hearing was “inevitable”. Mr Amey sought to say that the judge was referring to the inevitable failure of a cross-claim argument that the debtors had raised. There is something in that because in the relevant paragraph he had just referred to the failure of the debtors to adduce their evidence, but I doubt that that is the totality of what the judge had in mind. I consider that what he was doing was expressing deep scepticism as to the prospect of their being no bankruptcy order in April the following year. He was aware of the claim that £10m was said to be coming in in the next year (paragraph 15) but he apparently did not accept that that was bound to happen. In paragraph 17 he referred to the fact that “there may be a payment in full coming from the associated companies some time next year” (my emphasis). It is to be inferred that he took the view that there was no certainty about that. The manner in which the point was raised makes that a justifiable view. As against that there was the certainty of the guarantee liability and he considered that there was no sufficient prospect of that debt (as he expressed it) being paid within a reasonable time or at all. In saying that he is likely to have included the payment in full of the principal debt. He placed that against the background of the debtors playing for time, having failed to comply with the unless order, the predicted failure of the application to extend time (which would result in the continued bar on taking any steps in the petition) and came to his conclusion using the word “inevitable”.

24. It is probably right to say that the word “inevitable” may be a little too strong in the circumstances, but this experienced judge cannot have thought that there were no imaginable circumstances which would stand in the way of a bankruptcy order in 7 months time. For the reasons that he had given, which include justifiable scepticism about the repayment of the principal debt, he apparently formed the view that the prospects of defeating the petition were insufficiently strong by a very wide margin to justify waiting for those low prospects to mature. That was a view he was, in my view, entitled to reach on the material he had. On that footing this Ground fails.

25. As will appear at the end of this judgment, I have concluded that the same decision ought to be reached even if the judge erred in finding inevitability. Before expanding on that view I have first to deal with the other Grounds of Appeal. Mr Pettican did not really advance the other grounds in his oral submissions, though he made a case for them in an initial skeleton argument (superseded by Amended Grounds) which I was invited to read, and since he did not abandon them I need to consider them. Grounds 1, 2 and 3

26. It will be convenient to take these three Grounds together. They turn on the effect of ICCJ Prentis’s order. The criticisms related to these Grounds, extracted from the first skeleton, can be summarised as follows: (i) Having made a finding that the debtors were not in breach of ICCJ Prentis’s order, that should have been an end of that particular matter. (ii) The judge was wrong to find that the application would inevitably be dismissed if heard in November 2024 because (contrary to the judge’s finding) ICCJ Prentis did not make stipulations as to what the supporting evidence would need to contain; the judge wrongly assumed that the evidence before the court in November would be same as the evidence before him; and he failed to take into account the fact that the sums ordered by ICCJ Greenwood might be paid before the November date. (iii) The judge failed to take into account the possibility that the debtors might apply for relief from sanctions.

27. Point (i) fails. What was said about breaches of an order appeared in paragraph 7 of the judgment “7. In relation to the effect of ICC Judge Prentis’s order, Mr Amey’s submission is that, because the petitioner consented to an extension of time to 2nd August 2024, the respondents are in breach of the unless order and now require relief from sanction, which is not something that they have applied for. I am not sure that I can agree with that analysis because, while consent was offered to an order for an extension on the basis that the parties bore their own costs, that was not, in fact, reduced to an order of the court and so, in my judgment, there has not been a breach of an order to pay by 2nd August 2024 . What there is is an extant application to extend time, albeit one that specifies a revised date that has now passed and has not been amended. It was made within the time limit for compliance set out in ICC Judge Prentis’s order and, therefore, is strictly an application to extend time, rather than an application for relief from sanction. Mr Amey says that, if that is so, then nonetheless I should regard the application for an extension of time as having no prospect of success and simply dismiss it, or regard it as inevitably going to be dismissed, with the result that the position is the same. In that event the debtors would be in breach of the order and debarred accordingly.” (my emphasis to show the words relied on by Mr Pettican)

28. Mr Pettican’s submission seems to be that when the judge said there was no breach of an order to pay by 2 nd August 2024, he was finding no breach at all so the debtors were not in breach of any obligation. That is plainly not what the judge is saying. He was treating non-compliance with the condition of an unless order as a breach of that order (even though it might not technically be a breach because it did not order the debtors to do anything – it specified consequences if they did not do it, which is technically different) and pointing out that there was no order requiring anything to be done by 2 nd August. He may also have been saying that the failure to comply by 2 nd August did not nullify the fact that the debtors had applied for an extension of time, and that would be entirely correct. He was certainly emphasising that an application to extend time was different from an application for relief from sanctions, and again that would quite correct. He was certainly not making a determination of non-breach would somehow undo the effect of the unless order. There is nothing in this point.

29. Point (ii) fails as well. The judge below said this about the ultimate fate of the application to extend time: “13. I am entirely confident that a judge hearing the application to extend time would see it for what it is and would not grant any further time. The respondents would therefore be unable to take further steps in the proceedings without the permission of the court. It seems to me that, unless and until the costs had been paid, the court would not grant such permission. There is no evidence that they can be. The application to extend time for filing of evidence would therefore similarly fail.”

30. In paragraph 12 he pointed out that the evidence in support of the application to extend time did not contain the matters which ICCJ Prentis said would be necessary for an out of time relief from sanctions application, and although that was technically not the nature of the application made (because it was one day in time) it is obvious that the same sort of matters would be expected in an in-time application. The judge was right to equate the two for these purposes. The judge did not err in assuming that the evidence in November (or whenever the application was to be heard) would be the same. He was entitled to assume that the evidence put in already would be the evidence unless he was given good reason to suppose otherwise. Nor was there any evidence that the sums would be paid by the time the application was heard. The judge acknowledged that he was told that the full sum could be paid the next week (paragraph 9), so he did not ignore the possibility of payment, but he did not accede to an implied application to adjourn on that basis, acknowledging that an adjournment would go way beyond the next week. If he treated the indication of payment with scepticism he was justified in doing so. It was not supported by evidence, was contrary to the established position that the debtors did not intend to pay the costs liability, and it emerged only once counsel had finished his submissions and had turned to ask his clients whether anything more needed to be said. In more or less one sentence counsel referred to the possibility of payment the following week. If the judge thought that that was deeply unconvincing he would have been justified in doing so.

31. Point (iii) is unsustainable. In theory the debtors might have applied for relief from sanctions, but in practice if their application to extend time failed it is hard to see how an application for relief from sanctions would have fared any better, or would indeed have been particularly likely bearing mind the apparent attitude of the debtors towards paying.

32. It follows therefore that these three Grounds fail and fall to be dismissed. The result of this appeal

33. On my conclusions thus far this appeal stands to be dismissed and it is unnecessary to say more. However, I have considered what the result ought to be if I were wrong on the “inevitability” point under Ground 4. In that event I would have to consider whether to remit the matter or reconsider the points in issue myself. It is clear enough to me that remitting the matter would be quite unsuitable, so I will indeed consider whether a bankruptcy order should have been made in the light of the position of the debtors on the alleged future discharge of the principal debt, and I will also take into account the further evidence which the appellants sought to introduce and which Mr Amey accepted could be taken into account.

34. I consider that, taking into account the unappealed or unsuccessfully appealed findings of the judge, and the other surrounding circumstances, a bankruptcy order was nonetheless the right order in the circumstances. The judge’s view that the debtors had indulged in delaying tactics was a view he was entitled to take and is an important part of the background. They were in breach of the conditions of an unless order and did not put forward a good reason for that, and by the time the matter arrived before him they were very late. There was no good reason for an extension. The judge was right to point out that the guarantee debt ought to have been paid long before then and a creditor was entitled to expect that. The main point left to them at his hearing was the averment that the principal debt would be paid in 5 months.. I consider it instructive to consider what would have been the position if, absent that background, a guarantor debtor was seeking the adjournment of a petition for 5 months so that the principal debt could be paid, because that is a useful parallel to consider. I think that such a debtor, in those simplified circumstances, would have some difficulty in obtaining such an order. Put that against the background of the matters to which I have referred and it becomes even clearer that such an adjournment would not be appropriate. And that assumes in favour of the debtors that the evidence of future payment was sufficiently clear. In this case it was not that clear. One has to bear in mind the manner in which it was introduced, which was rather half-hearted (“Briefly …”) both in evidence and in submissions. On that basis I would dismiss the appeal assuming that it falls to me to decide whether the bankruptcy order ought to have been made.

35. However, there is an even more cogent factor in favour of that conclusion. The debtors’ big point is that the principal debt would be paid by the time the petition came to be heard in April 2025. It turns out that, contrary to their prediction, it was not clearly paid by then. The £10m instalment for the land seems to have come in (for some unknown reason in a sum slightly less that £10m, but that does not matter), but it got tied up with marshalling claims brought by another secured creditor company named Brooke Homes (Bicester) Ltd. The details of that are rather complex and were the subject of detailed consideration in a decision of Mr Hugh Sim KC, sitting as a deputy judge of this Division. An interim order was made on 7 th February 2025 providing for £2.3m to be paid to Brooke out of the £10m and for £3.5m to be held by Desiman’s solicitors pending the resolution of the disputes between Brooke and Desiman. That meant at that stage there was not sufficient money available to Desiman to repay what it said was the principal debt. On 27 th May 2025 Mr Sims delivered a written judgment dealing with matters of principle, but issues of how that was translated into sums of money and how they affected the £3.5m were not dealt with. Those issues were ultimately compromised on confidential terms which have not been disclosed to the debtors or this court, but a letter from Desiman’s solicitors dated 1 st December 2025 (the day before the hearing before me) states that further sums of £895,037.83 and £2,604,962.17 were paid to Brooke. It is said that this leaves a total indebtedness of Eco to Desiman of over £3.3m and it demonstrates clearly that a large part of the £10m was not available to repay the principal debt. (This letter was not technically part of the fresh evidence because it came late, but there was no objection to my seeing it and no reason to suppose that its contents are inaccurate). The debtors dispute what Desiman says is the principal debt outstanding, but one way or another it is not the case, and was not the case in April 2025, that it can or could be demonstrated that the money that came in was sufficient to discharge the principal debt.

36. These matters represent complex marshalling issues and complex money dealings between Desiman and Brooke, and an understanding of it all is unnecessary, but the essential point which emerges is that Desiman were not clearly paid in full out of the £10m instalment of the postponed consideration for the sale by what would have been the adjourned hearing of the petition in April 2025. The prediction of the debtors which lies at the heart of this appeal turns out to be false. It would be faintly ridiculous not to take that into account insofar as it falls to this court to re-take the ICC Judge’s decision itself, not least because it turns on evidence put in by the appellant-debtors themselves.

37. Accordingly the appeal fails on Ground 4 for these reasons as well Conclusion

38. I therefore dismiss this appeal. Annexe - the Grounds of Appeal 1, What was before the Judge on 13 September 2024 was an application dated 30 August 2024 by the Respondent seeking bankruptcy orders on the basis that the Appellants were debarred from taking any further steps in the petitions without the court’s permission due to the fact that the Appellants had breached an unless order made by ICC Judge Prentis on 31 May 2024. Having found (correctly) that the Appellants were not in breach of the unless order made by ICC Judge Prentis (because there was an extant application for an extension of time that was listed for hearing on 18 November 2024), the Judge should have dismissed the application. The Judge was wrong to go on to anticipate: (1) the likely outcome of the extension applications to be heard on 18 November 2024; and (2) the likely outcome of the disposal hearing of the petitions which was listed for hearing on 2 April 2024. 2, If (contrary to Ground 1), the Judge was right to consider the likely outcome of the extension applications listed for hearing on 18 November 2024, the Judge’s evaluation of the likely outcome was flawed in the following respects: 2.1 First, the Judge proceeded on the basis of a mis-reading of the judgment given by ICC Judge Prentis on 31 May 2024. The Judge states that ICC Judge Prentis stipulated that any application for an extension of time would need to be supported by evidence addressing certain matters. Contrary to what the Judge states, ICC Judge Prentis did not make any stipulations as to what the evidence in support of an application to extend time for compliance with his order needed to contain. What ICC Judge Prentis was addressing was the different situation where the unless order he made had taken effect and the Appellants were seeking relief from sanctions. Since (as the Judge found) the Appellants were not in breach of the unless order, they did not require relief from sanctions and consequently the observations of ICC Judge Prentis did not apply. 2.2 Second, the Judge failed to take into account that the applications and evidence before the court at a hearing on 18 November 2024 would not necessarily be the same as the applications and evidence before the Judge. In evaluating what the outcome would be of the extension applications if heard on 18 November 2024, the Judge failed to take into account the fact that it would have been open to the Appellants to seek to amend their applications and to file further evidence in advance of the hearing. 2.3 Third, the Judge failed to take into account the fact that the Appellants may have paid the sum of £33,500 to the Respondent in advance of the hearing on 18 November 2024. This was a very real possibility given that the Judge had been told on instructions that the full sum could be paid the following week by a third party. On this basis, a reasonable and proportionate approach would have been for the Judge to vary the order of ICC Judge Prentis to grant an extension of time for payment to the end of the following week on the basis that the Judge had been told that payment would be made. 3, If (contrary to Ground 1) the Judge was right to consider the likely outcome of the extension applications if heard on 18 November 2024, and further if (contrary to Ground 2) the Judge’s evaluation of this issue was not flawed, then the Judge’s decision to go on to consider the likely outcome of the disposal hearing listed for 2 April 2025 on the basis that the Appellants were debarred from taking any steps in the petitions was wrong. In doing so, the Judge failed to take into account the fact that, had the extension applications been dismissed on 18 November 2024, it would nevertheless have been open to the Appellants to seek relief from sanctions. 4, In any event, the Judge was wrong to make the bankruptcy orders. In doing so, the Judge: 4.1 Failed to have any (or any sufficient) regard to the evidence that the underlying indebtedness that gave rise to the debt under the Guarantee would be repaid by 21 February 2025 at the latest. Since this would be prior to the disposal hearing that was listed for 2 April 2025, the Appellants would have a defence on this basis. 4.2 Second, there was no basis in the evidence for the Judge’s assessment that the Removal Application would disrupt payments to the Respondent under the Cala Contract in respect of the underlying indebtedness. 4.3 Third, the Judge failed to take into account that, once the underlying indebtedness of P3 Eco/PPP to the Respondent had been repaid, there would no longer be any basis for the Respondent to claim against the Appellants pursuant to the Guarantee, save for a modest sum in respect of interest. The Respondent’s entitlement to claim this interest is disputed and, in any event, it would have been open to the Appellants to make a payment sufficient to reduce any debt below the bankruptcy limit. 4,4. Fourth (and fundamentally), the Judge’s conclusion that the outcome of the hearing on 2 April 2025 (if allowed to proceed) was “inevitable” was wrong. The Judge’s conclusion fails to take account of the evidence that, by the time of the disposal hearing, the entirety of the underlying indebtedness to the Respondent would have been repaid and the Removal Application would have been determined. The position may have been very different in April 2025 from the position in September 2024.