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Hotelier entitled to set off monies for pending personal injuries claims against debt owed for security services

By: Mark Tottenham BL

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High Court, on appeal from the Circuit Court, determines that a plaintiff company in liquidation was not entitled to enter final judgement for a debt arising from the provision of security staff, where the defendant hotelier and night club owner claimed a right to set-off concerning pending personal injuries claims relating to acts or omissions of the security staff, on the grounds that: (a) a director of the plaintiff company had signed a letter expressly providing that such monies could be withheld or set off; (b) the value of the pending claims was estimated to exceed the debt claimed; and (c) there was sufficient mutuality between the debt claimed and the alleged set-off.

Appeal from Circuit Court - debt collection - provision of security services to hotel and night club - set-off arising from personal injuries proceedings resulting from alleged acts or omissions on the part of security staff - whether a right of set-off existed - requirement of 'mutuality' - whether defendant entitled to withhold money on the basis of an asserted indemnity - letter of 2010 recording an indemnity - undertaking to have in place a policy of insurance - "It is hereby accepted and agreed that by way of security for such indemnity and undertaking that the Russell Court Hotel/Triglen Holdings Limited can withhold payment due to P & B Security Services Limited in respect of the security services provided, and set off such monies paid to claimants in respect of the claims referred to above against monies due to P & B Security Services Limited for security services provided." - Companies Act 2014, section 619 - contingent liabilities - paragraph 18 of the First Schedule to the Bankruptcy Act 1988 - section 62 of the Civil Liability Act 1961.

Note: This is intended to be a fair and accurate report of a decision made public by a court of law. Any errors should be notified to the editor and will be dealt with accordingly.

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