Dominic Chappell, the former owner of BHS, has been ordered by the High Court to pay at least £50 million to cover losses incurred by the retailer prior to its collapse. Previous rulings determined the two former directors of the British retail chain BHS, Lennart Henningson and Dominic Chandler, were to pay at least £18 million to creditors due to their roles in the company's collapse eight years ago. The new £50 million ruling comes after it was determined that Chappell sought to "plunder" the UK department store chain, leading to its financial downfall.
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Chappell acquired BHS from Sir Philip Green for £1, but according to the court, he had no realistic plan to secure the necessary working capital for the business. Mr. Justice Leech, who presided over the case, stated that Chappell took every opportunity to exploit the BHS Group for personal gain.
The court's decision includes payments for wrongful trading and breach of fiduciary duty, amounting to £21.5 million and £17.5 million. These sums, along with additional costs and interest, bring the total liability to at least £50 million. A separate payment for a misfeasance trading claim will be determined later.
Chappell, who is currently serving a six-year prison sentence for tax evasion, was found liable following a lawsuit by BHS liquidators. They accused him of wrongful trading, misfeasance, and breach of fiduciary duty, arguing that BHS should have ceased operations sooner to reduce creditor losses.
Source: www.retailgazette.co.uk