The Royal Court of Jersey has handed down judgment in Wood & Adam v Khumalo and Ors [2026] JRC 202, granting £77 million in summary judgment against former directors of Gold & General Ltd, a Jersey entity in liquidation.
The Joint Liquidators initiated proceedings under Article 176 (transactions at an undervalue) and Article 74 (breach of directors' duties) of the Companies (Jersey) Law 1991. The claim arose after the directors transferred valuable equity in an English company (Metallon Corporation) into a New Zealand trust for the benefit of one director. Although served in Switzerland and South Africa, the defendants failed to participate.
Key Principles Established by the Royal Court
- Summary Judgment Over Default Judgment: Following English authorities (Duferco SA and European Union v Syrian Arab Republic), the Court affirmed that granting summary judgment against non-participating foreign defendants is fully appropriate where there is no reasonable defense prospect.
- Adverse Inferences on Missing Documentation: Applying Re Mumtaz Properties Ltd, the Court established that where a director fails to produce contemporaneous documentation explaining company transactions, the Court will readily draw adverse inferences regarding whether transfers were made for proper corporate cause.
- Creditor Duty Alignment (Sequana): The Bailiff noted strong arguments in favour of formally recognising the Sequana creditor-duty principle within Jersey jurisprudence, reinforcing director accountability during impending insolvency.
- Source: Read South Square's case analysis on Summary Judgment for £77m Against Former Directors of Jersey Company.
Jersey: Royal Court Hands Down £77m Summary Judgment Against Directors (Wood & Adam v Khumalo)