What is a place of residence?

The debtor had been prevented from leaving the UK by court order and subsequently served time in prison for contempt of court for trying to flee.  After he was released, he resided at a former inmate’s house in London. 

The creditor argued that the debtor’s enforced stay in England & Wales did not constitute a place of residence pursuant to Section 263I of the Insolvency Act 1986 (the “Section”), which replicates the tests set out in Section 265 for creditor bankruptcy petitions.

The judge allowed the appeal and disagreed with the debtor’s submission that the test of having a place of residence simply means “that the debtor should have had an entitlement of some sort to occupy a place that is capable of being described as someone’s place of residence” as, pursuant to the Section, “the residence must be that of the debtor not someone else” and not just “mere occupation”.

Reviewing the authorities, including tax decisions, the judge held that the residency must have some form of permanency, above and beyond just occupation, eg, “a settled or usual place of abode or home”.

Shipping Company Ltd v Su and others [2021] EWHC 1866 (Ch Lakatamia)