TAQA Bratani Limited and Others (Respondents) v Fujairah Oil and Gas UK LLC (formerly known as RockRose UKCS8 LLC) and Others (Appellants)

Case summary

Case ID

UKSC/2026/0020

Parties

Appellant(s)

(1) Fujairah Oil and Gas UK LLC (formerly known as RockRose UKCS8 LLC) (2) RockRose Energy Limited (formerly known as RockRose Energy PLC) (3) Viaro Energy Limited (4) Viaro Investment Limited (5) Francesco Mazzagatti (6) Francesco Dixit Dominus

Respondent(s)

(1) TAQA Bratani Limited (2) TAQA Bratani LNS Limited (3) Spirit Energy Resources Limited

Issue

When determining the existence of a “transaction at an undervalue” entered into by a company under s238 Insolvency Act 1986, is the only relevant “transaction” one to which the debtor company is a party, or might the “transaction” also include a wider arrangement of which those dealings are an inextricable part? When applying the defence in s238(5)(b) Insolvency Act 1986, must the transaction be a “necessary part” of the wider arrangement for that wider arrangement to be relevant? What is the test for determining whether another transaction is “consideration for” the transaction said to have been entered into at an undervalue?

Facts

The first appellant, UKCS8, was a party to a joint venture agreement with the respondent companies, including TAQA, to exploit oil and gas fields in the Brae Area in the North Sea. UKCS8 was owned by the second appellant, RockRose, which was ultimately owned by the fifth Appellant. Mr Mazzagatti. UKCS8 and TAQA disagreed as to the approach which ought to be taken in the joint venture. Mr Mazzagatti attempted to reconcile those strategic differences but was unsuccessful in doing so. In addition, UKCS8 owed substantial sums of money to its partners in the joint venture under two Decommissioning Security Agreements (“DSAs”), which placed UKCS8 under a liability to provide security in respect of the future cost of decommissioning the oil fields. Mr Mazzagatti therefore approached the Fujairah International Oil and Gas Company (FIOGC) to purchase UKCS8 and provide a bond to cover the sums it owed, and thereafter to mend the relationship with TAQA and work constructively with it. RockRose and FIOGC thus entered into a Share Purchase Agreement according to which RockRose agreed to sell and FIOGC agreed to buy UKCS8. Before completion of this SPA, and at a time when UKCS8 was insolvent, Mr Mazzagatti arranged for a debt of US$84.7 million owed to UKCS8 by another company in its group to be extinguished by UKCS8 declaring a dividend. At the same time, RockRose wrote off a sum of US$53.7 million which a different company in the group owed to UKCS8 (“the Pension Write-Off”). Subsequently, TAQA issued Notices of Default under the DSAs, and later obtained, among other things, a default money judgment against UKCS8 in respect of UKCS8’s unpaid share of operating expenses and sums due under the DSAs. The Respondents then brought a number claims against the Appellants, including a claim under s238 Insolvency Act 1986 on the basis that payment of the dividend was a transaction at an undervalue which could be unwound. Dias J in the High Court held that the relevant “transaction” for the purposes of s238 was not the dividend but the wider arrangement by which UKCS8 was sold to FIOGC. She held that there was a transaction at an undervalue, but that the statutory defence in section 238(5) of the 1986 Act was made out because that wider transaction was carried out in good faith and for the benefit of UKCS8. She further held that the Pension Write-Off was consideration for the declaration of the dividend so should be taken into account in determining the amount of the undervalue. The Court of Appeal overturned that decision, holding that the relevant “transaction” was the declaration of the dividend, that the defence did not apply, and that the Pension Write-Off was not consideration for the declaration of the dividend. The Court of Appeal remitted the case to the Commercial Court to make an order under s238(3) of the 1986 Act. UKCS8 and the other appellants now appeal to the Supreme Court.

Date of issue

19 February 2026

Case origin

PTA

Judgment appealed

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