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(UK) Litigation Funding in Insolvency – Where Does PACAAR leave us?

Although a non-insolvency case the recent case of PACCAR Inc & Ors v Competition Appeal Tribunal & Ors (“PACCAR”) has caused waves in the litigation market (including insolvency litigation market) following the Supreme Court finding that litigation funding agreements (LFAs) where funders recover a percentage of the amount awarded to a claimant are damaged based … Continue Reading

(UK) Have You Got Consent? Dealing with Administration Extensions

Although an initial administration extension can be dealt with by consent, if that consent is not valid the extension will also be invalid.  This leaves administrators in a difficult position because they will not be in office unless the court remedies the position.  Obtaining consent might seem straightforward but obtaining the consent of secured creditors … Continue Reading

Are UK Restructuring Plans Still too Expensive?

As far as they go, restructuring plans have worked well since they were first introduced 3 years ago.  This is reflected in the most recent review of CIGA published by the Insolvency Service which reflects favourably on this new insolvency measure. However, there are still some barriers to its use. Not unsurprisingly costs are quoted … Continue Reading

Expected Changes to the UK Corporate Moratorium

The three year review of CIGA (the Corporate Insolvency and Governance Act) published by the Insolvency Service suggests that we might see changes to the corporate moratorium process – will these address concerns about the process and encourage more insolvency practitioners to recommend its use? The moratorium aims to protect companies from enforcement action to … Continue Reading

Are HMRC Critical To UK Restructuring Plans?

It’s now level pegging for HMRC on cram down –  twice it has been crammed down, and twice it has not. In the most recent restructuring plan proposed by Prezzo, the court sanctioned the company’s restructuring plan and crammed down HMRC as both preferential and unsecured creditor.  Unlike Houst’s restructuring plan, where HMRC was also … Continue Reading

Are UK Interest Rate Rises Squeezing Working Capital?

In its battle to control and reduce the rate of inflation, the Bank of England has increased interest rates for a 13th consecutive time. Already at its highest level for nearly 15 years, rising interest rates are continuing to apply pressure on finances both at home and in businesses. Despite the Bank’s efforts, although slightly … Continue Reading

(UK) Disclosure and Vote Swamping Revisted – Has the Position Changed following the Mizen CVA Appeal?

In two recent blog posts we discussed the challenge made to the Company Voluntary Arrangement (CVA) of Mizen Build/Design Ltd (the “Company”) by Peabody Construction Limited (“Peabody”) and the finding of (i) a material irregularity based on failure to disclose information to creditors in the CVA proposal, and (ii) unfair prejudice based on vote swamping. … Continue Reading

Can UK Administrators Apply For Conditional Discharge of Liability?

The court has recently confirmed that it does have jurisdiction to grant administrators a conditional discharge of liability but decided not to do so in the case of Re Central Properties Holdings Ltd (in administration) [2023].  In this blog we consider why the court refused to make that order and whether there are any circumstances … Continue Reading

(UK) Pensions – A Pot to Play for?

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 is Meant by the language to “Consider” in the Insolvency Legislation ?

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

(UK) Avanti: The Evolution of a Spectrum – from Fixed to Floating Charge, who Needs Control?

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

Latest Market Guidance on the National Security and Investment Act 2021 (“NSIA”) is not particularly comforting to UK restructuring professionals

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

(UK) The Gloves are off for HMRC: What did we learn from the Great Annual Savings Sanction Hearing?

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

“It’s the principle of the thing”: HMRC fights back against UK Restructuring Plans

‘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

What is in your Derivatives?

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

(UK) Stripped and Outnumbered: Compromising Guarantee Claims in a CVA 

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

(UK) EBT Claims- Have Beneficiaries been Unjustly Enriched?

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
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