The recent case of Re Lloyds British Testing Ltd [2023] is a reminder not to forget that in the right circumstances a director’s occupational pension pot might be a valuable source of funds that an Insolvency Practitioner (IP) can access to recover an unpaid debt due from a former director. Background In this case, an … Continue Reading
What can we say about the outcome of the GAS (Great Annual Savings Company Limited) sanction hearing that hasn’t already been reported? It’s impossible not to comment on the fact that the plan was not sanctioned, and as a consequence of fierce opposition from HMRC that it avoided cram down. Nor that the court refused … Continue Reading
The recent case of Dolfin Asset Services Ltd v Stephens & Anor (Re Dolfin Financal (UK) Ltd) [2023] EWHC 123 (Ch) (“Dolfin“) concerned a special administration, but it has relevance to administrators more generally. In particular, when it comes to the judge’s view of what is meant by the word “consider” – which is phrase … Continue Reading
In a decision likely to be welcomed by both debtors and lenders, the High Court has held that a charge granted by Avanti Communications Limited (“Avanti”) was properly characterised as a fixed charge (rather than a floating charge) notwithstanding that the chargor retained an element of control over the charged assets. A key plank of … Continue Reading
The NSIA is aimed at safeguarding national security and only applies to certain transactions occurring within certain sectors where national security might be threatened. There are 17 sectors in total, including energy, transport, and communications. Depending on the transaction, the NSIA may require a purchaser to notify the Secretary of State of an acquisition to … Continue Reading
Yesterday saw the end of a three-day sanction hearing for the restructuring plan (the “Plan”) of the Great Annual Savings (GAS) company, with Justice Adam Johnson reserving his judgment and importantly, his decision on whether to exercise cross-class-cram-down to sanction the Plan for a later date. As we discussed in our recent blog, the Plan … Continue Reading
‘If, at first, you don’t succeed, then try and try again’ is a fitting description for HMRC’s recent approach to restructuring plans, with its opposition of plans proposed by The Great Annual Savings Company (GAS) and Nasmyth Group Limited (Naysmyth). The GAS sanction hearing (which is due to take place this week) will be the … Continue Reading
Recent market shocks (from the 2022 mini budget which triggered a pension fund crisis to more recent developments with respect to Credit Suisse, Silicon Valley Bank and Signature Bank) will prompt market participants to review their hedging arrangements. There are several matters to take into account when market participants start to experience distress, and in … Continue Reading
In a previous blog about the case of Mizen we considered the case from the point of view of “guarantee stripping”, looking at how the CVA dealt with those claims. However, the CVA was challenged on a number of bases, including whether it was unfairly prejudicial as a consequence of “vote swamping”. In this blog, … Continue Reading
A company voluntary arrangement (CVA) is a tool which has been widely utilised by companies seeking to restructure and compromise liabilities. In recent years CVAs have been in the limelight because of attacks by landlords who feel that they have been unfairly prejudiced by the CVA terms. Largely, challenges such as those to the Regis … Continue Reading
Can a liquidator run an unjust enrichment claim to seek to recover PAYE and NIC liabilities from a company’s directors arising from the company’s use of a “disguised remuneration” employee benefit trust (“EBT”) scheme? Based on the findings of ICC Judge Barber in the case of Re Ethos Solutions Ltd, the answer is “no”.… Continue Reading
Where a commercial property is sold by a receiver or insolvency practitioner (IP), VAT must be charged on the sale if the owner had exercised and properly notified an option to tax (OTT) in respect of the property. The IP acting on behalf of the seller needs to establish whether an OTT has been made … Continue Reading
Following the sanctioning of the Good Box restructuring plan (RP) it seems the answer is yes. This might sound surprising to those familiar with schemes of arrangement, because that outcome is at odds with the long-standing decision in Re Savoy Hotels. For those less familiar with schemes and scheme case law, the court declined to … Continue Reading
The challenges facing the care sector are not news to anyone. However, as we enter 2023, a sector which has historically operated on thin margins may be about to hit breaking point, with the number of insolvencies involving residential care businesses having increased by 59% in the last year alone. Is it possible to identify … Continue Reading
It is difficult to predict what 2023 might hold for businesses in the UK. Given the difficult economic environment, many will already be facing a challenging start to the year. Although the challenges of the pandemic (such as lock downs) have gone, others have materialised. Energy price hikes and inflation rises continue to make trading conditions tough. At some point in 2023 affected businesses may have to restructure, and others may need to enter a formal process. … Continue Reading
The requirement for overseas entities to register or be registered on the UK Register of Overseas Entities (ROE) at Companies House could impact certain transactions that insolvency practitioners (IPs) and lenders are involved with. Our latest quick guide highlights some of those areas and flags points for IPs and lenders to consider when dealing with … Continue Reading
The recent decision in Re Astora Women’s Health LLC illustrates the importance of cross-border recognition of insolvency processes, highlighting the benefits of a joined-up global approach which recognises that modern business do not stop for international borders. With Astora hot off the presses and the twenty-fifth anniversary of the UNCITRAL Model Law on the horizon … Continue Reading
The power to appoint an administrator is an important power for debenture holders when seeking to enforce their security. In order to exercise that power, the debenture has to be a qualifying floating charge (“QFC”) and it has to be enforceable. The case of Borg-Olivier v Knowles & Ors [2022] EWHC 2579 (Ch) (“Borg-Olivier”), highlights … Continue Reading
On 11th November 2022, Mr Justice Zacaroli handed down judgment on an application for directions made by the officeholders of ten different energy supply companies (“ESC” or “ESCs”) seeking clarification on issues arising in the insolvencies of the ESCs which had not previously been the subject of judicial consideration. In terms of quantum, the issues … Continue Reading
Devinder Singh, a restructuring and insolvency partner in SPB’s Birmingham office, acted for one of ten applicants in an application for directions made in the High Court by a number of officeholders following the collapse of several energy supply companies (“ESC”). The application sought directions on a number of key issues affecting the energy industry … Continue Reading
Can a Company Voluntary Arrangement (“CVA”) complete, but still remain in place and bind creditors? The simple answer is yes; but it does require (a) the terms of the CVA to be carefully drafted to allow notice of completion to be filed before the end of the CVA term; (b) compliance with the terms of … Continue Reading
Supply chain disruption was exacerbated by the pandemic, and due to the ongoing conflict in Ukraine problems continue to impact UK businesses. Unfortunately there is no sign of disruptions abating in the short term. In a recent webinar Sarah Rathke explored the question: “Why is Everything Broken? Understanding Pandemic Supply Chains” which is available to view … Continue Reading
We look once again at the recent case of Re Active Wear Limited (in administration) (our other blog on another aspect of this case can be found here). As part of the changes introduced in light of Covid-19, the Temporary Insolvency Practice Direction (MIPD) was introduced, to enable statutory declarations on notices of intention to … Continue Reading
The UK High Court has ruled that the obligations of third-party guarantors are not affected by a part 26A restructuring plan being sanctioned in respect of the underlying obligations. This approach mirrors the way guarantees are dealt with in a part 26 scheme of arrangement. The case of Oceanfill Ltd. v Nuffield Health Wellbeing Ltd … Continue Reading
