In light of there being no previous written judgment on the issue in the BVI, Justice Jack helpfully decided to deliver one. Reference was made to the Privy Council’s decision in the related judgment Federal Republic of Brazil v Durant International Corp  where it was held that ‘backwards tracing’ was potentially legitimate. Backward tracing is where a party looks back in time in order to show that the defendant, in commercial reality, obtained his property with property which was itself obtained in breach of trust. This slightly widened the rules on tracing to reflect the use of a web of bank accounts with complex entries between them, and reflects a practical approach in circumstances where it can be shown that a network of bank accounts and transactions are being used as part of an overall scheme.

Acknowledging that analysing the movement of monies between the three companies would be a costly and time-consuming exercise, and in light of the creditors being the same for all companies, Justice Jack considered that it was appropriate to make a pooling order, if he had the power to do so. He held that he did so under Schedule 2 of the Insolvency Act 2003 which gives liquidators of BVI companies the power to make a compromise or arrangement with creditors, and in light of English Court of Appeal authority acknowledging there can be a departure from the pari passu rule if it is merely ancillary to the exercise of any of the statutory powers afforded to the liquidators.

It is now beyond doubt that the BVI has jurisdiction to make pooling orders in a similar way to that of the Cayman Islands which has long recognised such jurisdiction going back to cases such as Re Bank of Credit and Commercial International (Overseas) Ltd  in 2000 and following the approach taken by the Grand Court in the Centaur Entities  matters in 2017.