Following our previous blog Revolution Bars: When is a meeting really a meeting?” Mr Justice Hildyard has, in Re Argo Blockchain Plc[1], affirmed the position that a creditor can only approve a restructuring plan (“RP”) if at least 75% in value of a class of creditors, present and voting either in person or by proxy at the meeting, vote in favour. A single chairman holding proxies for two or more creditors does not constitute a valid meeting for the purpose of approving a RP and, irrespective of the proxy vote, the class will be treated as dissenting.

Notwithstanding Hildyard J’s comment that the position taken in Re Dobbies Garden Centre Limited[2] (where the meeting of the only class of creditor to approve the RP was attended by one) was both practical and simple in approach, he nevertheless declined to follow Dobbies, instead adopting the original guidance in Re Altitude Scaffolding Ltd[3].  Hildyard J found that “it is an essential quality of a meeting, and the rationale of the requirement of a meeting in Part 26 (and now Part 26A) of the [Companies Act 2006], that it is… an assembly or the coming together of two or more persons.”

The current position does bring into question the point of allowing a vote by proxy if, at the meeting where that vote is purportedly to be counted, it is disregarded by virtue of non-physical attendance of the creditor themselves (and not for want of interest or opinion).

Votes by proxy in Argo Blockchain, notwithstanding that they were entirely in support of the RP, were treated as technically dissenting, thereby requiring a cross-class cram down (“CCCD”), and the corresponding burden of satisfying section 901G conditions, for the RP to proceed.

In circumstances where the RP is not approved simply by this technicality, the plan company and creditors may well receive support from the court, but this is not guaranteed, nor without cost. Current law on this topic, as it stands, poses a risk to both the plan company and supportive classes as an entire RP could fail if all creditors choose to vote by proxy in favour but only one or none physically attend the meeting itself.

As a matter of practice therefore, and to avoid the unnecessary need to apply to court for a CCCD, plan companies should ensure more than one creditor in each class attends in person and votes at the RP meeting.

[1] [2025] EWHC 3395 (Ch)

[2] [2024] CSOH 11

[3] [2006] BCC 904