Speed read
The British government has commenced an airline insolvency review, in the wake of recent high profile airline failures such as Monarch and Air Berlin, and on the premise that changes in the industry have outpaced protection regimes.
The review will focus on two main areas: repatriation of stranded passengers and redress for consumers. There is a desire to minimise repatriation costs falling on the public purse and ensure that consumers have clear avenues of redress.
On 12 December 2017, creditors in the long running special administration of failed stockbroking firm, MF Global UK Limited (“MF Global”), approved a company voluntary arrangement (“CVA”). This case demonstrates the flexibility of the CVA procedure and the role it can play in complex financial services cases.
What is a CVA?
Overview
The High Court has held that insurers who had facilitated litigation proceedings by an insolvent company were not entitled to a lien akin to a solicitor’s common law or equitable lien over the proceeds of the litigation to recover the deferred premium.
Introduction:
Wide ranging changes to insolvency law will come into force on 1 October 2015 that will have repercussions for insolvency practitioners, directors and D&O insurers alike. One of the more significant - and controversial - changes allows office holders in insolvency proceedings to assign claims deriving from those proceedings to third parties. The implications of this are potentially far reaching and are discussed below.
New powers of assignment
The amendments to the Insolvency Act 1986 will extend the protection of essential supplies on insolvency to most private utility suppliers. They will also extend protection to I.T. supplies, including data storage and processing and website hosting. Further protection is introduced where contracts are entered into from 1 October 2015, so that insolvency related terms which allow higher supply charges in the event of administration or company voluntary arrangement will be prohibited.
Why is the law changing?
As we reported in April, the Insolvency Service has issued a call for evidence inviting comments on the issues with, and improvements that could be made to, the collective redundancy consultation requirements for employers facing insolvency. The Government has been seeking views on how well the requirements work both before an insolvency practitioner has been appointed to the failing company and after a formal appointment has been made.
Case: The joint administrators of African Minerals Limited (in administration) v Madison Pacific Trust Limited and Shangdong Steel Hong Kong Zengli Limited (HCMP 865 of 2015)
On 26 March 2015, the Deregulation Bill and the Small Business, Enterprise and Employment Bill received Royal Assent. These Acts make a number of important changes to the law affecting directors, insolvency law and regulation.
The changes affect (among other things) directors’ liabilities, the powers of administrators and the rights of creditors. While some changes are relevant to all those advising companies and directors, others are of interest principally to insolvency officeholders.
Case: (The Trustees of the Olympic Airlines SA Pension and Life Assurance Scheme (Appellants) v Olympic Airlines SA (Respondent) [2015] UKSC 27)
On 12 December 2017, creditors in the long running special administration of failed stockbroking firm, MF Global UK Limited (“MF Global”), approved a company voluntary arrangement (“CVA”). This case demonstrates the flexibility of the CVA procedure and the role it can play in complex financial services cases.
What is a CVA?