In the last week we have seen MPs criticise accountancy firms, KPMG, Deloitte, EY and PWC in their first report on the collapse of Carillion, describing the big four as “a cosy club” and calling for the firms to be forcibly broken up. Whilst not suggesting that the firms were to blame for the collapse, … Continue Reading
VE Vegas Investors IV LLC and others vs Shinners and others [2018] EWHC 186 Ch Background The applicants were creditors of VE Interactive Limited (In administration) (“VE”). VE encountered financial difficulties and its directors sought insolvency advice from insolvency practitioners at Smith and Williamson (“S&W”) and appointed them to advise on and effect a pre-pack … Continue Reading
Following our post on the failure of Carillion yesterday, Ray O’Connor of our Construction team has written the following article “Carillion’s Insolvency – How to Protect Yourself” which looks at practical ways forward for any sub-contractor, employer/developer or funder involved in a project with Carillion. In the event any advice is required on any issues … Continue Reading
Air Berlin, one of Europe’s largest airlines, filed for insolvency on 15 August 2017. The airline, which is Germany’s second-largest carrier after Lufthansa, filed following the decision by Etihad Airways to pull financial support. Etihad owns 29% of Air Berlin and had been pumping money into the struggling airline for the past 6 years. The … Continue Reading
The English courts have recently wrestled with the Cross Border Insolvency Regulations 2006 (“CBIR”) in a case about the lifting of the automatic stay on proceedings against Korean company STX Offshore & Shipbuilding Co Ltd In the present case (Re International Bank of Azerbaijan OJSC) the English High Court found itself dealing with the application … Continue Reading
As of 25 April 2017, for courts within the Chancery division of the High Court in London, the filing of all applications, forms and documents must be performed electronically. This includes the Bankruptcy and Companies Courts within Greater London. It does not apply to the High Courts outside London. Where once a lawyer might expect … Continue Reading
Managing residential tenanted property can be a challenge for receivers. In many cases, it is necessary for them to act as “accidental landlords” to maximise the potential realisations to the appointing lender. These lenders have lent money to companies or individuals who invest in residential blocks and collect rents from their tenants. When the borrowers default, … Continue Reading
The case of Bailey v Angove’s Pty Ltd heard in the UK Supreme Court has confirmed the general rule that an irrevocable agency will only be created in exceptional circumstances: there must be a specific agreement that the agent’s authority is irrevocable and the authority must be given with the intention of securing an interest of … Continue Reading
The English Court has agreed to lift the automatic stay on proceedings under the Cross Border Insolvency Regulations 2006 (“CBIR”) against STX Offshore & Shipbuilding Co Ltd (“STX”) which had entered into rehabilitation proceedings in Korea. Facts STX had guaranteed to Ronelp Marine Limited and others (“Claimants”) the performance of a subsidiary (Dallan) in relation to … Continue Reading
The Pension Protection Fund (PPF) is reviewing its insolvency risk model with Experian. The proposals being considered are particularly relevant to the financial services and charity sectors. It is proposed they be introduced from 2018/2019 (and will not be part of the draft levy rules and levy estimate for 2017/18, which we expect will contain few … Continue Reading
When we review security for financiers, we always consider what enhancements they might implement to strengthen their security net. As part of this approach, we obtain a proprietor search from the Land Registry to see if there is any uncharged property in the name of the borrower. Often, any property identified is a short to … Continue Reading
TMA’s Journal for Corporate Renewal July/August 2016 published an article written by Nava Hazan, Mark Salzberg and Susan Kelly, which discusses how the US Bankruptcy Courts have been open to foreign debtors, as well as the limits to such availability, which was the subject of the recent Baha Mar decision in Delaware. The article further … Continue Reading
The Court of Appeal has recently considered the status of contingent assets within the balance sheet test for insolvency in the context of a company’s inability to pay its debts. Under Section 123 Insolvency Act 1986, a company is deemed unable to pay its debts if its assets are less than its liabilities including contingent … Continue Reading
Until recently the oil and gas sector has not been on the restructuring communities radar. However, last year global oil prices hit an all-time low, which led to a record number of insolvencies in the industry. Consequently in conjunction with Lexis Nexis we have produced the Guide to insolvency in the UK oil and gas … Continue Reading
The health and social care sector is currently facing its most significant challenge since the Southern Cross care-homes collapse in 2011. A financial crisis is on the horizon, resulting from the unwelcome trifecta of rising staff costs, significant funding cuts and a steadily increasing regulatory burden. In the five years since the Southern Cross collapse … Continue Reading
The BHS CVA is now in effect following a successful ‘yes’ vote on 23 March 2016 when 95% of creditors voted in favour of the proposals. The BHS CVA is the latest in a long line of CVAs that have been successfully used to reduce the burden of onerous lease arrangements across large retail portfolios following … Continue Reading
2015 saw the global oil and gas market in turmoil and 2016 looks set to continue the trend. 16 January 2016 saw the lifting of sanctions against Iran, and critically signified its re-entry as a major OPEC player to the already saturated global oil and gas market. With the world’s fourth-biggest oil reserves, an immediate … Continue Reading
The director at the heart of the Carrington Wire pension fund deficit saga has been disqualified for a period of 12 years. Background We have previously reported on the background to the Carrington Wire Limited (“CWL”) collapse and the Pensions Regulator’s actions in issuing warning notices to CWL’s former Russian parent company (OAO Severstal), and … Continue Reading
Complex multi-jurisdictional insolvencies are an inevitable consequence of the increasingly global nature of big business. The collapse of the likes of Barings, Enron and most recently Lehmans (the latter involving insolvency proceedings in some 16 jurisdictions) have highlighted the growing need for legislative action to promote cross-border co-operation and protect the interests of international creditors. … Continue Reading
On October 15, Squire Patton Boggs Partner Michael Cuda was interviewed for a segment on Bloomberg TV’s “Markets” program where he discussed the price of oil and energy credit line redeterminations. Michael, based in the Dallas office, specializes in petroleum-industry turnarounds. He said Banks that lend money to energy companies are likely to slash credit … Continue Reading
The recent TMA Global Annual Conference in Scottsdale Arizona gave us a great opportunity to meet with friends and colleagues old and new and swap intel and war stories! The buzz at the conference was around the oil and gas sector. Drilling down: Turmoil in Oil and Gas was the panel moderated by our very … Continue Reading
The English High Court has, in one of the few successful cases on wrongful trading, clarified when directors ought to know that there is no reasonable prospect of avoiding insolvent liquidation and where the burden of proof lies in such cases. Background In Brookes v Armstrong (also known as Joint Liquidators of Robin Hood Centre … Continue Reading
The English High Court has again considered whether by itself the choice of English law and court jurisdiction in legal documentation establishes a “sufficient connection” with England to enable a foreign company to avail itself of an English scheme of arrangement. Background It has become increasingly popular for foreign companies to utilise an English scheme … Continue Reading
In March 2014 the European Commission issued a Recommendation considering a new approach to business failure and insolvency, targeting efficient restructuring of viable enterprises in financial difficulty and a second chance for honest entrepreneurs. The objective of this Recommendation was: “to encourage Member States to put in place a framework that enables the efficient restructuring … Continue Reading
