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Back to the future? The return of Crown preference

The proposal to reinstate Crown preference in insolvency has met resistance from all angles; the insolvency profession, turnaround experts, accountants, lawyers and funders. But despite HMRC’s bold statement in its consultation paper that the re-introduction of Crown preference will have little impact on funders, it is clear following a discussion with lenders that it may … Continue Reading

HMRC, preferential treatment and insolvency – uncertain times for funders

This morning Squire Patton Boggs in conjunction with R3 hosted representatives from across the business community to discuss the proposed return of Crown preference in insolvency. Following the Government announcing in last Autumn’s Budget that HMRC’s preferential status will be restored in part in April 2020, Squire Patton Boggs together with R3 and representatives from … Continue Reading

Can directors file an out of hours administration appointment?

With the introduction of electronic filing which allows parties to file documents at court 24/7 we consider the recent case of Wright v HMV Ecommerce Limited (2019) in which the court was asked to confirm whether administrators were validly appointed following the directors filing a notice of appointment after the court office was closed.… Continue Reading

Relief from forfeiture – in the balance

The demise of high street retail and the insolvency of household names, including Woolworths, BHS, and more recently Debenhams and Monsoon has been a real headache for property owners. The moratorium created by administration ties the hands of landlords, preventing them from forfeiting leases without first having obtained the consent of the administrator or the … Continue Reading

Careful Consideration Can Pay Dividends

Following our 2016 article, the Court of Appeal has upheld the decision of the High Court that dividends are liable to challenge as transactions defrauding creditors under section 423 of the Insolvency Act 1986 (the “IA”). The case of BTI 2014 LLC v Sequana S.A. & Others [2019] EWCA Civ 112 should serve as a … Continue Reading

Beware SoLR Power in Energy Administrations

With the gradual opening of energy supply markets allowing new energy providers to challenge the established providers and bring increased competition to the market, the last two decades have seen an increase in smaller energy providers entering the market and sharing a growing customer base. But what happens to the customers when an energy provider … Continue Reading

Landlord’s Rights: Enforcement options in insolvency

When dealing with a debtor or a tenant that has fallen behind with its payment obligations, one of the most cost effective ways of a creditor/landlord reducing its exposure against that entity will be to take advantage of a “self-help” remedy, such as taking possession of the entity’s assets and selling them in repayment of … Continue Reading

Brexit proof your holiday

For those already making European holiday plans for summer 2019, or for those hesitantly waiting to see the results of ‘B’ day on 29 March there are still questions about what might happen to travel plans after this date. The Association of British Travel Agents (ABTA) has issued practical guidance to reassure travellers at this … Continue Reading

Pensions versus Insolvency: changes to The Pension Regulator’s powers

There has always been a tension between protecting the interests of defined benefit pension schemes and insolvency given on the one hand The Pensions Regulator (TPR) seeks to protect the interests of pension scheme members and the Pension Protection Fund and on the other, the insolvency regime seeks to protect the interests of creditors as … Continue Reading

When is a decision to declare an interim dividend a decision?

It is often common practice for small businesses to structure payments to a director (who is also a shareholder) through a combination of dividend payments and salary, in order to minimize PAYE liabilities and reduce tax.  Consequently, rather than be paid a salary, a director is “remunerated” by dividend payments.  This works when the company … Continue Reading

Black Friday- risks and opportunities for UK retailers

You may have noticed from the emails flooding into your inbox (even in this post-GDPR world) that this Friday 23 November is “Black Friday”. The event, originating in the US, takes place the day after Thanksgiving and is now synonymous with heavy discounting by retailers, especially those online. Less than a decade ago, this would … Continue Reading

HMRC, Insolvency and Post-Budget Preferential Status

Following the Enterprise Act 2002, the preferential status which HMRC had enjoyed in an insolvency was abolished, rendering HMRC the same as any other unsecured creditor. The effect of this was to swell the pot of assets available to be applied to all unsecured creditor claims. Philip Hammond announced in Monday’s budget that HMRC’s preferential … Continue Reading

Squire Patton Boggs: offering certainty to restructuring and insolvency in the face of an uncertain future post-Brexit

No one knows for certain what the future will hold for the UK and the remaining EU countries post 29 March 2019 but in the context of cross-border insolvency we do know that if there is a no-deal Brexit, that the Recast Regulation on Insolvency Regulation (EU) 2015/848 will be repealed. So, what does this mean … Continue Reading

Can’t Prove it? You’ll lose it.

Summary The High Court has issued a judgment dismissing the entirety of the Claimants’ claim in a long-running dispute commenced by a pair of property developers against a Judicial Factor to the estate of a Scottish businessman (the “Deceased”). Squire Patton Boggs represented the successful Defendant, who was awarded the majority of his costs on the … Continue Reading

BHS CVA: landlords win on penalties

Background BHS agreed a CVA with its creditors in March 2016. As with so many large, high-profile CVAs the key issues for BHS were the rental burdens arising out of their store network- they are known as “landlord CVAs”. The CVA followed a now common format where landlords were placed into different categories according to … Continue Reading

Government proposes legislation to enhance UK insolvency regime

On 26 August, the Government announced that it will be making changes to UK insolvency legislation. The changes are intended to support distressed companies and address issues highlighted by major company failures and include: the ability for all companies to apply for a moratorium a new insolvency process – the “restructuring plan”, enabling companies to cram … Continue Reading

Let’s fly away…..

In the holiday season many of us jet-set to foreign shores – but do we ever think  about how we might get home if our budget airline goes bust or are we just hunting for the best deals to make the pound stretch further? The last decade has seen a number of airlines collapse or … Continue Reading

Secured creditors – don’t be too involved with your customer’s administration!

The case of Davey v Money and Anor (2018) EWHC 766 (Ch) should serve as a gentle warning to secured creditors to be aware of the level of their involvement in the administration of a customer. Background Angel House Development Limited (“AHDL“), a property development company, borrowed £16 million from Dunbar Assets Plc (“Dunbar“) in … Continue Reading

Post-LAPSO landscape – how have the changes affected insolvency claims?

The Ministry of Justice is seeking feedback from key stakeholders on the impact of Part 2 of the LAPSO reforms, which abolished the recoverability of success fees under CFAs and after the event insurance premiums. Until April 2015 insolvency claims were exempt, enabling insolvency practitioners to pursue claims and if successful recover any success fee … Continue Reading
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