Tag Archives: creditors

A Fight over the Runway II – Monarch Successful on Appeal

Following on from our previous blog A Fight Over the Runway – Monarch Administrators Lose High Court Battle, the latest development in the saga is the recent Court of Appeal decision in Monarch Airlines Ltd v Airport Coordination Ltd [2017] EWCA Civ 1892. Overturning the decision of the High Court, the Court of Appeal held that Monarch … Continue Reading

EU Proposals for Harmonisation of Insolvency Practitioners and Judges

Much has already been written about the proposal for the “Second Chance” directive (“Proposal“) published in November 2016 which is still being debated by the EU bodies – and rightly so. Harmonisation of insolvency law across the EU is needed as one in four insolvency proceedings is a cross-border insolvency and creditors need to know what to … Continue Reading

English Scheme of Arrangement approved for Luxembourg-registered company

The English High Court has sanctioned a scheme of arrangement for Algeco Scotsman PIK SA, a Luxembourg-incorporated company, after the creditors consented to the New York governing law and jurisdiction clause being altered in favour of the jurisdiction of the English courts. The issues discussed were: the fair representation of a class of creditors; cross-jurisdictional schemes; and early tender fees offered … Continue Reading

A Fight Over the Runway – Monarch Administrators Lose High Court Battle

An out-of-hours office appointment of an administrator, although not unusual, is not a regular occurrence in the world of insolvency. It is however, exactly what happened at 4am on Monday 2 October, as Britain’s longest surviving airline brand ‘Monarch’ entered administration. The collapse of the airline comes as a result of mounting cost pressures in … Continue Reading

Steering to Safe Harbour – Changes to Australian Insolvency Laws Herald a New Era for the Turnaround of Distressed Companies

Australia’s corporate insolvency regime has undergone significant reform with the passing of the Treasury Laws Amendment (2017 Enterprise Incentives No. 2) Bill 2017 (the Bill) through both houses of parliament. One of the key elements of the reforms is the introduction of a “safe harbour” for company directors, operating as an exception to the civil … Continue Reading

Reporting the misconduct of companies, directors and bankrupts

There are various ways misconduct can be reported in respect of companies and individuals. Establishing which authority has the power to conduct investigations of wrongdoing depends to a certain extent on the status of the companies and individuals. The Insolvency Service is empowered by law as the proper authority to investigate transgressions such as serious corporate abuse and the conduct of … Continue Reading

Australian investors gain significant win against Standard & Poor’s

Investors in Australia, represented by Squire Patton Boggs in Sydney, have made history again with another big win over Standard & Poor’s (S&P). They were granted leave to pursue a “tort of deceit” claim, alleging that S&P intentionally altered its ratings methodology to achieve higher ratings in order to serve its business objectives. This is the … Continue Reading

Hope for easier restructuring of SMEs: German Institute of Public Auditors propose new standard Restructuring Opinions

German insolvency laws are very strict. The management of an insolvent company is under strict obligations to file for insolvency, and failure to comply with such obligation may result in civil and criminal liability. Other stakeholders, like financing banks or suppliers, who are dealing with a distressed company, require documentation that their contract partner can … Continue Reading

Declaration of debts by French debtors- creditor vigilance is still required!

Three years ago, the Commercial Code amended the procedure for declaring debts in France with the aim of simplifying the management of insolvency proceedings. Before this reform, the only way for creditors (excluding employees) to declare their debts was to send their proof of debt to the receiver within 2 months (or 4 months for those living outside … Continue Reading

Employee Benefit Trusts and insolvency – the next big thing?

Remuneration schemes involving Employee Benefit Trusts (EBTs) have become more prevalent over the last 20 years, often as a way of seeking to remunerate key employees without making pay as you earn or national insurance contributions. Given the developments highlighted below, insolvency practitioners are advised to investigate such schemes in matters coming across their desks to see … Continue Reading

“But, we had a deal!” – Office Holders and Personal Liability for Costs

The recent Court of Appeal case of Stevensdrake Limited v Stephen Hunt [2017] EWCA Civ 1173 provides guidance on whether the office holder is liable to meet the legal costs in CFA cases where there are insufficient recoveries in the estate to meet those costs. Central to costs assessments in litigation proceedings is what is … Continue Reading

Schemes of Arrangement: Share-splitting unsuccessful in blocking a takeover scheme

In a corporate world where the capital structures of companies are becoming increasingly complex, schemes of arrangements under the Companies Act 2006 have established themselves as the restructuring procedure of choice for many distressed companies. This popularity is evidenced by the fact that schemes of arrangement have been increasingly used by overseas companies wishing to restructure their … Continue Reading

Take “Special” care: Not all Insolvency Rules change on 6 April

The wait is almost over! As reported in our recent blog Rules of Engagement for Creditors, the Insolvency Rules (England and Wales) 2016 (“IR2016”) are about to arrive heralding procedural reforms effective (subject to transitional provisions) on 6th April 2017. Whilst most people’s attention will be on the changes introduced by IR2016, it should be … Continue Reading

Rules of Engagement for Creditors – New Insolvency Rules In Force 6 April 2017

On 6 April 2017, the new Insolvency Rules come into force which will affect creditors’ rights in most insolvency procedures. The changes are designed to ensure insolvency processes are as efficient and streamlined as possible in order to maximise returns to creditors by reducing costs whilst retaining safeguards to avoid abuse or injustice. Whether you … Continue Reading

Prohibited names and partnerships under Section 216

The recent case of Re Newtons Coaches [2016] EWHC 3068 considered whether a partnership falls within the remit of s.216 Insolvency Act 1986 (“IA 86”). The case looked at what s.216 is designed to prevent and the nature of partnerships in the context of both the Insolvent Partnerships Order 1994 (“IPO 94”) and the IA … Continue Reading

Wrongful Trading – The Importance of Quantifying Loss

The recent successful appeal in Brooks and another (Joint Liquidators of Robin Hood Centre plc in liquidation) v Armstrong and another [2016] EWHC 2893 (Ch), [2016] All ER (D) 117 (Nov) has clarified and highlighted the complexities of bringing a wrongful trading claim and the importance of correctly quantifying losses for which directors can be made … Continue Reading

Christmas on Credit

With the UK festive season now merrily in swing, credit cards maxed out on Black Friday and Cyber Monday bargains and Christmas shopping well under way, will the lure of the Christmas spirit be enough to tip some people over the edge into unmanageable debt? For many the holiday season is a time to adopt … Continue Reading

The return of Turpin! – Validity of Administration Appointments by Directors and the Duomatic Principle

In the case of Re BW Estates Ltd the High Court considered the validity of a directors’ out of court appointment in circumstances where there was technically an inquorate directors’ board meeting. It was held that the appointment was not invalid despite only one director being present at the meeting convened to put the company into administration in … Continue Reading

Creditors v Private Pension Holders – has UK bankruptcy law gone too soft?

The recent Court of Appeal decision in Horton v Henry has highlighted the protection afforded to a bankrupt holding a private pension to the detriment of his bankruptcy creditors. Facts The bankrupt, Mr Henry, was the holder of  a number of pension policies all of which contained provisions entitling him to make elections which would trigger rights to … Continue Reading

Reviewing the Ratings

Multiple class actions have been commenced in the Australian Federal Court  in relation to losses suffered by investors in synthetic collateralised debt obligations and other financial products, some of which were distributed or sold by Lehman Brothers Australia Ltd (in liquidation) and by certain major Australian banks, and were assigned credit ratings by Standard and Poor’s. … Continue Reading

Why financiers should consider taking security over short leases

When we review security for financiers, we always consider what enhancements they might implement to strengthen their security net. As part of this approach, we obtain a proprietor search from the Land Registry to see if there is any uncharged property in the name of the borrower. Often, any property identified is a short to … Continue Reading

Is it possible to Restructure in Russia?

Theoretically, a Russian debtor is able to reorganize. In practice, the law currently does not encourage voluntary restructuring of debt in a way designed to preserve the continued operation of business and jobs.  The interests of debtors and creditors are not appropriately balanced at present to achieve the best results.  Creditors currently have a strong … Continue Reading
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