Glencore Energy UK Ltd v Prax Lindsey Oil Refinery Limited (in liquidation) [2026] EWHC 2394 (Ch)
Mr Justice Trower has granted permission, pursuant to s.130(2) Insolvency Act 1986, for Glencore to bring a claim for proprietary relief against the previous owner and operator of the Prax Oil Refinery (“PLOR”) for fraudulent misrepresentation, notwithstanding the liquidation of PLOR and sale of the refinery last year. The judgment is of real interest to commercial litigators and insolvency practitioners alike because it treats as “seriously arguable” the proposition – advanced by Edward Cumming KC and Erin Hitchens – that Re Crown Holdings (London) Ltd [2015] EWHC 1876 (Ch) was wrongly decided, and that the equity to rescind a contract for fraudulent misrepresentation is not lost when a representor goes into liquidation.
PLOR had gone into liquidation after irregularities were discovered in a securitisation facility which funded its group of companies and which – it is alleged – are a result of a fraud perpetrated by its former director, Mr Soosaipillai. At the time of the liquidation, Glencore was the sole supplier of crude oil to PLOR, and was exposed to losses of US$236 million in respect of sales of crude oil for which it had not received payment.
Glencore alleges that it entered into sales confirmations for the supply of this crude oil in reliance upon representations contained in a framework agreement and other transaction documents between Glencore and PLOR, which PLOR knew to be untrue and misleading. It therefore seeks rescission in equity of these sales confirmations.
In its response to Glencore’s application for permission under s.130, PLOR sought to rely upon Crown Holdings (London) Limited (in liquidation) [2015] EWHC 1876 (Ch) (“Crown Holdings”), in which Murray Rosen QC held that the equity to rescind as a result of a fraudulent representation was only a personal right, which did not survive the liquidation of the company.
Mr Justice Trower held that – whilst he did not need to decide the point upon a s.130 application – it was seriously arguable that the court at trial would be convinced that Crown Holdings was wrongly decided. Mr Rosen had not addressed the point that – although an equity to rescind does not, of itself, give an interest in the property transferred in reliance upon a fraudulent misrepresentation – it is not merely a right in personam, but an imperfection in the title of the transferee, which is binding upon the property transferred. He saw no reason why the approach to the effect that a bankrupt’s estate remains subject to a pre-existing right to rescind should not also apply upon liquidation of a company.
Mr Justice Trower also held that none of the other objections advanced by PLOR undermined his conclusion that Glencore had a seriously arguable case that it would be entitled to equitable rescission at trial. Most notably, he considered it seriously arguable that each of the relevant sales confirmations, whilst they incorporated the terms of the underlying framework agreement, were severable contracts for the sale and purchase of separate shipments of crude oil, capable of being rescinded individually (applying the principles in Trafigura Pte Ltd v Gupta [2026] EWHC 159 (Comm)).
To read the full judgment, please click here.
Edward Cumming KC and Erin Hitchens (instructed by Jones Day) appeared for Glencore on its successful application.
