At the beginning of 2025 we shared our predictions on what we expected to see in the R&I market over the course of the year.  How did we do? 

We considered that the importance of fairness and how the restructuring surplus should be shared would be a focus point of restructuring plans (RPs) and that was certainly the case, with the RPs of Petrofac and Waldorf leading the way. 

We expected 2026 to start off with a bit of bang with the Waldorf appeal leapfrogged to the Supreme Court and the hope that this would provide clarification around how the issue of fairness should be approached. But with the appeal being withdrawn late in 2025 practitioners will have to look back on some of the key cases from 2025, Petrofac and Thames Water, for guidance.  

Even though the appeal has fallen away, with the question of fairness still on the agenda and the new Practice Statement setting out a new framework for the case management of RPs, restructuring plans look to be a key area for development and refinement in 2026 too.

Following the case of BHS which introduced the concept of misfeasance trading, we wondered if we would see more claims against directors for misfeasance trading.  There hasn’t been a marked increase in reported cases, but as most of us will know it takes time for cases to work their way through the courts.  Certainly, in our experience, the “threat” of such a claim seems to have sharpened the focus of directors to take advice earlier. 

Given that the Insolvency Service will receive additional funding to pursue rogue directors (announced in the Budget) and will have power to pursue more claims under ECCTA, for directors, at least, 2026 is likely to see more scrutiny of their actions.

We have certainly seen some lenders take more aggressive and novel stances during 2025 when it comes to enforcement of security and recoveries on insolvency, not just in relation to their fixed charge assets.  And although the question of whether an administration appointment is valid has not exercised the courts much in 2025, in practice the question of whether an appointment is valid continues to be of concern.

We did ask the question: Will the Insolvency Service clarify their view that creditors are classed as creditors at the point of entry into a process? following the cases of Pindar and Toogood and flux in the market about the treatment of paid secured creditors.  And guess what, they did, publishing a revised view in Dear IP 168.  However, we are not convinced that the position is entirely settled as questions still arise about the status of a creditor and maybe we will see more on this in 2026.

Although we were hopeful in our predictions that some niggles might be addressed in 2025 by a Rules change – this hasn’t happened. Rumours are afoot that there will be a further consultation in 2026 on changes to the Rules.  If true, pens at the ready to respond to any consultation so that those niggles can be aired and hopefully changed.

We added the Employment Rights Bill to our watch list for 2025, and this certainly has been on our radar.  With the expectation that this will be enacted in early 2026 there will be some changes that IPs will need to reflect on – see our specialist briefing note.

We are still waiting for the fine tuning to the NSIA which would see liquidators added to the list of exceptions.  As this has not come to fruition yet, we can bump this to the 2026 watch list.

What we didn’t see coming in 2025 was the NOAL/Novalpina decision that put MVLs into spotlight.  Do all MVL debts need to be paid within 12 months? What are your obligations as MVL liquidator to deal with contingent claims?    Both points that we expectantly wait the Court to consider on appeal in June 2026.  We think the decision will be an important one in shaping the use of MVLs in the future.

What else might be on the cards for 2026?  Well, if a Rules changes and the use of MVLs and RPs is not already enough we understand that HMRC intend to increase the use of securities, increase the issues of joint and several liability notices, and support the Insolvency Service to increase the number of enforcement sanctions where there has been an abuse of the insolvency regime causing tax losses.

We also saw R3 propose changes to the fee structure for CVLs in 2025, perhaps that will gain traction with the Insolvency Service in 2026 given the possibility of a Rules shake-up. 

And there were also a number of cases in 2025 that considered issues around remuneration, highlighting areas where the Rules don’t always assist IPs who need fee approval or are wanting to change things, something also for inclusion in a Rules change?

At least bringing some of the Rules into alignment with practice – such as the use of CE-filing would be welcome.  Technology and practice have moved on a lot since the Rules were first introduced and if we could remove the requirement to have to file three copies of an NOA at court, practitioners would be very happy with that as a starter for ten.

It looks like 2026 could be an exciting year of change for all.