10.02.2026
Caitlin Ferguson, Emily Hynes and Zoe Vanhegan of PCB Byrne LLP acted for the Appellant in the matter of South Bank Hotel Management Company Ltd (“South Bank”) v Galliard Hotels Ltd & Ors. Following a 3-day appeal hearing at the end of last year, in its judgment handed down on 6 February 2026, the Court of Appeal allowed all three of South Bank’s grounds of appeal, finding that:
The grant of a lease carving out property from a freehold interest for the benefit of the trustee, does amount to conversion of trust property for the purposes of Section 21(1)(b) of the Limitation Act, particularly when it creates circumstances where the beneficiary remains the freeholder but is required to pay rent for use of part of the property.
A continuing contractual obligation gave rise to a continuing breach; and
Section 44(5) of the Companies Act will not protect a purchaser who knows a document purportedly signed on behalf of a corporate counterparty was not in fact signed by the authorised signatories or director. Rather "section 44(5) is meant to protect purchasers who do not know that the position is otherwise than it purports to be"[139].
The judgment provides helpful insight on the application of Section 21(1)(b) of the Limitation Act, the interrelationship between group companies and application of Section 44(5) of the Companies Act. The case has been remitted to the trial Judge for determination of outstanding issues.
Counsel, James Willan KC of Essex Court Chambers and Saaman Pourghadiri of 3 Verulam Buildings were instructed on the appeal for South Bank.
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