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Latham & Watkins LLP

Directors Duties and Misfeasance Trading Lessons From BHS

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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

Latham & Watkins LLP

Restructuring Plans and the Price of Dissent

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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

Latham & Watkins LLP

Charging Ahead: Grappling With the Characterisation of Fixed and Floating Charges

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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

BCLP

Fair's fair: the concept of fairness in Part 26A Restructuring Plans

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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

Conyers

Commercial Real Estate Debt Burden Concerns: The BVI Perspective

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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

A&O Shearman

UK Jurisdiction Taskforce Publishes Consultation on Digital Assets and Insolvency Law

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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

Latham & Watkins LLP

Cramming Down Pension Liabilities: The Final Frontier?

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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

Latham & Watkins LLP

Directors’ Duties: Shining Light in the Tunnel?

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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

Dechert LLP

Sequana: “Momentous” Judgment by Supreme Court on the Creditor Duty

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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

Katten Muchin Rosenman LLP

UK Supreme Court Confirms Creditor Duty in Zone of Insolvency: BTI v Sequana

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

A&O Shearman

Directors’ Duties in an Insolvency Context: Where Creditor and Shareholder Interests Collide

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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

Hogan Lovells

Creditor Duty – the position after the Supreme Court decision in BTI v Sequana and Others

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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

Latham & Watkins LLP

English Court Confirms Expansive Jurisdiction to Reverse Transactions to Defraud Creditors Even Outside Insolvencies

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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

Locke Lord LLP

Regis - Landlords Lose the Fight to Force CVA Nominees to Return Their Fees

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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

Morrison & Foerster LLP

The Part A1 Moratorium: Stop Right Now, Thank You Very Much – I Need Some Time For A Rescue

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

Hogan Lovells

The Sun Also Rises on Pre-pack Administration Reform

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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

Goodwin

UK Corporate Insolvency and Governance Act 2020 Brings Significant Changes to Law

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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

Goodwin

Dealing With Crypto-Assets In A Downturn – Lessons From London And Other Jurisdictions

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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

Hogan Lovells

Prescribed part to increase from £600,000 to £800,000 from 6 April 2020

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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

Hogan Lovells

CVAs – retail’s flexible friendship continues

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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

Latham & Watkins LLP

UK Court of Appeal: Creditors Can Seek to Reverse Lawful Dividend Payments

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Ruling provides helpful reminder to directors, companies, and creditors that Section 423 of the Insolvency Act 1986 applies even outside of insolvency. Background - The UK Court of Appeal has upheld a decision that a...more

Katten Muchin Rosenman LLP

The Rule in Gibbs – An End to Creditor Protection? - Bakhshiyeva v Sberbank of Russia [2018] EWHC 59 (Ch)

What Is the "Rule in Gibbs"? The rule in Gibbs is a long-established common law principle in which the Court of Appeal determined that a debt governed by English law cannot be discharged or compromised by a foreign...more

Latham & Watkins LLP

English Court Confirms International Jurisdiction to Set Aside Transactions Defrauding Creditors

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Section 423 of the Insolvency Act 1986 continues to be a useful tool available to creditors for challenging transactions at an undervalue. Section 423 gives the English court the power to set aside a transaction (most...more

Latham & Watkins LLP

Deal Teams Can Scheme to Success

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Schemes of arrangement are a well-known and familiar tool for many within M&A. They are often used to implement acquisitions of public or widely held companies or restructurings of financial indebtedness, frequently as part...more

Latham & Watkins LLP

Litigation Funding Cements England’s Insolvency Litigation Hub Status

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Much like the English Scheme of Arrangement which has become a popular debt restructuring solution for international debtors, the English High Court is an attractive forum for insolvency litigation thanks to the potent...more

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