Introduction

The Grand Court of the Cayman Islands has recently offered additional, useful guidance in the growing jurisprudence on the insolvency of Segregated Portfolio Companies (“SPCs”). We have previously discussed the applicable test of insolvency that applies to the appointment of a receiver in respect of a segregated portfolio (“SP”) of an SPC here.

In The Matter of Padma Fund L.P. [FSD 201 of 2021] (RJP), the Cayman Grand Court held that the Cayman Court does not have jurisdiction to order the winding up of a Cayman exempted limited partnership (“ELP”) on the basis of a creditor’s petition for the winding up of the ELP. The Court ruled that the correct procedure for a creditor to follow is to commence proceedings against the general partner of the ELP for an unpaid debt.