Coffee Tycoon’s Widow Could Bankrupt Company
Angus McCallum-Toppin’s widow could destroy the AMT coffee chain, as the remaining partners fail to fulfill their financial duties to her.
AMT is a coffee company that was set up in 1993 by Alexander and his sons Angus, Alistair and Allan. From one coffee cart outside Oxford’s Westgate shopping centre, their empire grew, and now they are found in multiple locations across the UK and Ireland.
Following the death of their father in 2001, ownership of the company was split into seven. Each son had two shares, whilst their mother, Anna had one.
In 2005 the brothers signed an agreement which ensured the profits made by the company were split equally.
Unfortunately in 2006, Angus passed away after a battle with cancer. As a result his two-sevenths in the company went into his estate for the benefit of his widow Lucy and two children.
However, the family collapsed into ‘dysfunctional squabbling’ and Lucy was never paid her fair share, after being branded a gold digger by Alistair.
A High Court battle ordered Alistair and Allan to buy Lucy and her children out of the company. A payout which lawyers predicted could be worth up to £7million.
In March 2019, the brothers were ordered to make a £1.5million interim payment, but this never materialised.
As a result of this, Lucy presented the High Court with a bankruptcy petition which was aimed at the company’s managing director Alistair.
The Court found in her favour, due to her and her children’s financial needs not being met as a result of the two brothers using the company as their own personal ‘piggy bank’.
During the hearing it was revealed that between the year’s of Angus’s death and 2015, the brothers withdrew more than £1million between them in directors’ loans. These loans in turn were used for personal expenses which included home improvements.
Of this matter the Judge said it was “entirely informal” and created “a significant credit risk for the company.”
Judge Daniel Schaffer said:
“It is clear that, during the time they have controlled the company after the death of Angus, Allan and Alistair have used the company as a piggy bank to make personal expenditure at a high level on their behalf.
“Once Angus had died, his estate was largely ignored and his widow Lucy excluded. They ignored Lucy’s existence as best they could and continued their own course.’
He said Alistair had “refused to treat the estate holding Angus’ shares in the same way as he would have considered Angus himself.”
“Moreover, there is evidence that he saw Lucy as a gold digger…I accept that he did not want to declare dividends that would benefit her.
“The conduct […] of the respondents has gone […] to enrich themselves at the expense of the company.
“There were then incessant squabbles between Alistair and Allan umpired, if unwillingly, by their mother.
“No enterprise run on commercial principles would have organised the remuneration of directors on such chaotic lines.”
Alistair attempted to rebut the bankruptcy case by protesting that the £1.5million payment had been made to Lucy as her role as one of the Trustees of the Angus McCallum-Toppin Will Trust, and not as an executor of Angus’ estate.
Alistair claimed that no debt was owed to the Trustees so the bankruptcy claim could be dropped.
These protests were ignored by the judge who said:
“In the light of the conclusions I have reached in dismissing all objections raised to the petition, normally a bankruptcy order would be made when judgment is handed down.
“I will give the debtor the opportunity to seek a deferral of that order on an application to adjourn the petition, to facilitate payment of the petition debt.”