The case of Glint Pay Ltd v Baker [2025] EWHC 2166 (Ch) highlights that solvency alone does not prevent enforcement where contractual defaults exist, even if the enforcement forms part of a takeover strategy.
The High Court last month struck out claims by Glint Pay (and its subsidiaries, which were also placed into administration) that challenged the validity of administrators appointed by a floating charge holder who had purchased secured debt and sought to enforce it. The companies were not insolvent at the time. The alleged default was non-financial, relating instead to information obligations. The judgment is a clear restatement of how English courts treat enforcement by secured creditors, including in the sensitive factual space where enforcement is linked to a prospective acquisition.
Facts in brief
- Glint Pay, a fintech company offering gold linked payment services, was operating at a loss but was not balance-sheet insolvent or unable to pay its debts.
- In 2019 a special purpose vehicle (Niven Alpha) acquired a secured loan to Glint Pay and its subsidiaries.
- Niven served information requests under the security documentation. Glint provided no response.
- Niven accelerated the debt and appointed administrators. The administrators negotiated with Niven; shareholders later refinanced and the administrators left office.
- Glint later sued, arguing (inter alia) the assignment was invalid, the information request did not trigger a default, and enforcement was for an improper collateral purpose (a takeover).
What the Court held
- Assignment valid. The Deed of Assignment passed the full bundle of lender rights (including the information obligations) to Niven.
- Event of default established. The company’s complete failure to reply to the July 2019 information request amounted to an Event of Default allowing acceleration and enforcement, despite Glint not being insolvent.
- No improper purpose vitiation. The Court held that calling in a default and appointing administrators to allow an independent office holder to take control, even where the appointor expects to seek acquisition afterwards, is not necessarily an improper purpose that invalidates enforcement.
- Braganza-style duty rejected. The claimants argued that the contractual discretion to request information should be subject to an implied duty to act reasonably and in good faith, known as the Braganza duty (from a 2015 Supreme Court case, Braganza v BP Shipping Ltd). The Court confirmed that such limitations, which usually apply where one party’s discretion directly affects both sides (e.g. in employment contracts), do not restrict a lender’s unilateral enforcement rights.
- Estoppel / conduct. The Court noted that, in any event, Glint’s later conduct (including entering the deed that facilitated the administrators’ exit and supporting their fee application) would likely estop it from denying that the administrators were validly appointed; bringing the claim after such conduct risked being an abuse of process.
Outcome
The claim was struck out as having no realistic prospect of success and reverse summary judgment was entered for the former administrators.
Practical takeaways for clients
For lenders / chargees
- Enforcement is possible even where the company is not technically insolvent, if a clear contractual Event of Default has occurred.
- Ensure assignment documentation is clear and demonstrably transfers the lender’s rights (including ancillary information rights).
- If enforcement is contemplated, document the factual basis for the Event(s) of Default and contemporaneous steps taken to enforce.
For borrowers / chargors
- Do not ignore properly made contractual information requests. A total failure to respond is highly risky and may itself create an Event of Default, regardless of solvency.
- If you consider a request abusive or motivated by a collateral purpose, preserve contemporaneous evidence and communicate clearly but be aware that motive alone will not automatically invalidate enforcement.
For insolvency practitioners and advisers
- Consider estoppel and conduct-based defences from the outset: post-appointment conduct (e.g. supporting fee approval) can compromise later challenges and may be treated as an abuse of process.
Get expert advice on enforcement and restructuring
If you’re facing questions about enforcement, solvency, or lender rights, our specialist corporate and insolvency solicitors can help. Get in touch with our team for clear, practical advice tailored to your situation.
