SUPERMODEL Elle Macpherson has praised Douglas firm Moroneys for securing a ruling in the Isle of Man High Court on her behalf.
The case has brought a relatively little-known legal principle dating back 300 years into the spotlight.
Earlier this year the liquidators of Kaupthing Singer & Friedlander (Isle of Man) Limited brought a claim against Miss Macpherson in the Isle of Man High Court.
The liquidators had refused to offset Miss Macpherson's deposit with the now-insolvent bank against money owed by her nominee company to the bank for a mortgage on a house in London.
Miss Macpherson set up an Isle of Man nominee company in 2006 to allow her to purchase the property whilst keeping her address private.
On deciding to sell the house in September 2009 Miss Macpherson attempted to offset her deposit with KSF against the money which her nominee company still owed KSF for the mortgage.
KSF's liquidators refused such a 'set off', because the borrower was a company – albeit one owned by Miss Macpherson – whereas the deposit was held in her personal capacity.
This raised a legal issue apparently not previously determined by any court.
As Deemster Andrew Moran QC noted in his 53-page judgment: “In this case, for the first time anywhere in the world (I am told), where this form of Bankruptcy Set-Off provision exists, the facts have thrown up a novel situation and question."
Instructed by Speechly Bircham of London, Moroneys' team of advocates comprised principal Louise Byrne, and John McDonnell QC, who successfully argued the case in the Manx High Court on the basis of an ancient legal principle known as 'equitable set-off'.
Deemster Moran QC ruled that "the parties who were throughout and in truth, notwithstanding the interposition of [the nominee company], the real and substantial parties to the transactions… were the Bank and Miss Macpherson."
Miss Macpherson, an Australian supermodel and businesswoman, said: "The team at Speechly Bircham, Mr John McDonnell QC and local counsel Moroneys all worked hard to argue complex and ancient equitable principles in the context of modern law.
"I am very grateful for the tenacity and commitment of counsel and the brilliant team at Speechlys who provided clear insight and were able to establish a robust defence in this difficult case.
"I am extremely pleased with the ruling."
Moroneys' principal Louise Byrne said: "This was a complex and sensitive case. I am delighted that we have been able to secure such a positive result for our client. We are regularly instructed in complex and sensitive litigation matters and always work 100 per cent on behalf of our clients."
