Actions brought against the BHS directors by the group’s liquidators have resulted in the largest reported award for wrongful trading since the provision’s introduction, but the judgment highlights some unsettled areas of the...more
Despite three recent landmark UK restructuring plan decisions, uncertainty remains around the value, if any, a plan company should offer dissenting creditors as the “deliverability price” of a plan....more
The characterisation of fixed and floating charges remains a complex area, not least with respect to new intangible asset types. The key distinction between a fixed and a floating charge is well established as a matter of...more
Since its inception under CIGA 2020, there has been no shortage of legal commentary on the effectiveness of the legislation governing Part 26A Restructuring Plans, and the ways in which the judiciary have interpreted and...more
With commercial property companies’ debt burdens reaching pre-2008 levels and warnings being issued this month by the European Central Bank, in this article we outline some of the key issues to be considered and steps which...more
The U.K. Jurisdiction Taskforce has published a consultation relating to its proposed Legal Statement offering guidance on the application of English insolvency law principles to digital assets. The proposed Legal Statement...more
In this client alert, we set out the key findings by the Court of Appeal in Darty Holdings SAS v Geoffrey Carton-Kelly [2023] EWCA Civ 1135, which considers an appeal against the High Court decision that a repayment by Comet...more
What is a scheme? A compromise or arrangement between a company and any class or classes of its creditors (and/or shareholders). The process broadly mirrors an English scheme of arrangement thereby providing legal...more
A novel debt restructuring plan will allow the carrier to recover following pandemic turbulence. In December 2022, Hong Kong Airlines’ Hong Kong scheme and English restructuring plan were sanctioned by the respective...more
Section 423 of the Insolvency Act 1986 allows for the reversal of certain transactions at an undervalue that are intended to prejudice the interests of creditors. The scope of Section 423 is extensive and may be used to...more
The Part 26A restructuring plan has introduced significant cross-class cramdown powers that may impact the defined benefit pension arrangements in the UK. As the UK looks set to enter a new restructuring cycle, the...more
In a new ruling, the UK Supreme Court concluded that the rule applies only when a company is “insolvent or bordering on insolvency”. On 5 October 2022, the UK Supreme Court handed down judgment in BTI 2014 LLC v. Sequana...more
The Supreme Court has ruled, for the first time, on the existence, specific content and engagement of the so-called “creditor duty” or the “rule in West Mercia”. In doing so, it unanimously dismissed BTI’s appeal. ...more
Key Points - - The UK Supreme Court has affirmed directors' duty to consider creditors' interests. - The timing for the duty to be engaged is pushed back to when a company is bordering on insolvency. - Once the...more
UK Supreme Court gives important judgment on directors’ “creditor duty” The UK Supreme Court in BTI 2014 LLC v Sequana SA and ors [2022] UKSC 25 has given an important judgment clarifying the nature of the so-called “creditor...more
The Supreme Court’s decision in BTI v Sequana & Others represents the most significant ruling on the duties of directors of distressed companies of the past 30 years. This Supreme Court decision considers the balancing...more
The ruling confirmed that Section 423 of the Insolvency Act 1986 has extensive international reach, and does not require a transaction at an undervalue to leave the debtor with insufficient assets. Background - The...more
In a judgment handed down earlier today in Regis UK Limited, Mr Justice Zacaroli ruled against landlords seeking repayment of fees against the nominees of a CVA for hair salon and beauty business operator, Regis UK....more
The Part A1 Moratorium is an insolvency process that was introduced by the Corporate Insolvency Governance Act 2020 to help financially distressed companies obtain temporary protection from creditor action, while the company...more
In 2015, responding to mounting concerns about pre-pack administration sales, a set of voluntary industry measures were introduced to address the perceived lack of transparency and trust in the process – especially when the...more
The Corporate Insolvency and Governance Act 2020 received royal assent on 25 June 2020. Many of the provisions of the act are based on the bill which was initially proposed pre-COVID-19, with a framework having been set out...more
The next recession will be the first to occur since Bitcoin and other crypto-assets became prevalent in UK businesses. This Client Alert highlights how UK courts and insolvency officeholders may deal with crypto-assets in an...more
Executive Summary - In a press statement on 28 March 2020, the UK government announced proposed changes to insolvency laws in response to the Covid-19 coronavirus. • Wrongful trading: there will be a temporary suspension of...more
The UK Parliament made an Order on 3 March 2020 which increases the prescribed part, payable to unsecured creditors from floating charge recoveries on the insolvency of a company from £600,000 to £800,000....more
On 19 September 2019, Norris J handed down judgment in the challenge brought by six landlords against the Debenhams Retail Limited (Debenhams) company voluntary arrangement (CVA) which was approved by 94.71% of Debenham’s...more