Key point
Under English law there is a clear public interest in ensuring the timely and efficient administration of insolvent estates and parties should comply with all time limits in the Insolvency Rules 1986 unless there are good reasons for requiring more time.
The facts
Key point
The equitable rules designed to protect guarantors from amendments to the original financing agreements made without his consent do not apply to indemnities under English law.
The facts
A company entered into factoring arrangements. The directors entered into indemnities in favour of the factor.
Key point
Under English law a pre-pack sale of assets by administrators should be considered to be a "sale implemented under a court approved process."
Facts
The company was put into administration by an order of the court, and an order was made granting the administrators liberty to enter into an immediate pre-pack sale of all of the company's assets.
Key point
Under English law it is now clear that, in order to trace monies through bank accounts, it is not necessary that payments should occur in any specific order.
The facts
Key point
The UK Government has published its response to their July 2013 consultation on restoring transparency and trust in the UK corporate governance regime. There are a number of proposals to widen the scope of the director disqualification regime and make recovery of losses by creditors from responsible directors easier.
The response
Key point
Where in a UK administration an action would give some benefit to creditors, and risk neither detriment to them nor impede the administration's progress, the court may be willing to intervene and support a challenge to the administrator's actions.
The facts
In the past, HMRC has allowed insolvency practitioners to cancel the VAT registration of businesses at an early stage and account for VAT on any subsequent supplies using form VAT 833. HMRC has received legal confirmation that a deregistered business cannot issue a valid VAT invoice, which could result in VAT registered buyers of assets from insolvent businesses being denied claims for input tax. As a result, HMRC will no longer allow the early deregistration of insolvent businesses.
Key point
When assessing if a company is insolvent on the "cash-flow" basis, the Court will consider not only whether a company manages to meet its debts as they fall due but also how a company does so. A company meeting its debts simply by increasing longer-term debt, will likely be held to be insolvent.
The facts
Key point
A winding up petition founded on a tax assessment, which is the subject of an appeal to the Tax Tribunal, should be dismissed or stayed pending the appeal.
The facts
Key points
- In order to rescind a winding up order the court must be satisfied that the circumstances of the case are materially different to those before the court that made the winding up order.
- A stay of a winding up order would not be made as an alternative route was available.
Facts