It's out! The Supreme Court has handed down its keenly awaited judgment on whether banks owe a Quincecare duty not to carry out a customer's instructions in cases of suspected fraud.
On 17 December 2015, the Ministry of Justice made a final decision to end the Insolvency Litigation exemption from the 2012 Legal Aid, Sentencing and Punishment of Offenders Act (LAPSO) (see Written Statement here). Successful claimants will no longer be able to recover the success fee on a Conditional Fee Agreement (CFA) or After the Event insurance (ATE) premium from the opposing party for those CFAs entered into or ATE obtained from 1 April 20
'I can't be responsible for every single thing that goes on at Sports Direct. I can't be. I can't be!'
Mike Ashley founder and Executive Deputy Chairman Sports Direct appearing before the Business Innovation and Skills Select Committee (June 2016)
Toone v Robbins 2018 [EWHC] 569 (Ch)
The lessons to takeaway
Directors who are also shareholders need to be careful when arranging how to take payments from a company. For tax reasons, dividends can be perceived to be an attractive way to take cash out of a company, but if there are insufficient distributable reserves, such payments are unlawful and can be clawed back.