An order providing for the commencement of certain provisions of the Personal Insolvency Act 2012 brings the following three new debt settlement arrangements into operation with effect from 31 July 2013:
There have been a number of recent cases where companies have sought a reduction in their share capital by way of a High Court sanctioned process. One such case involving Aer Lingus raised interesting issues about the status of pension fund shortfalls as liabilities of the employer company as Emmet Scully and Jennifer McGuire report.
In a reduction of capital application, the High Court’s primary concern is whether the company’s creditors would be prejudiced by the reduction of capital.
The High Court has made an order disqualifying the two directors of Mossway Limited (In Liquidation) for a period of 12 months.
Background
The principal business of the company had been the provision of haulage services with a warehousing and distribution facility. On 3 June 2011, the Revenue Commissioners presented a petition to wind up the company on the basis that it was unable to pay its debts as they fell due. The Court made the order sought and appointed an Official Liquidator.
The Personal Insolvency Act 2012 (the “PI Act”) was signed into law on 26 December 2012 and introduces significant changes to the personal insolvency regime in Ireland, as described in our previous client briefing concerning the PI Act (issued in December 2012 and available on our website). All provisions of the PI Act, other than Part 4 which relates to bankruptcy, have now been commenced and it is expected that debtors will shortly be able to avail of the new insolvency measures.
It has been suggested that Ireland improperly transposed the Employer’s Insolvency Directive into Irish Law by adopting a definition of “insolvency” which requires an actual winding up order (or a resolution of voluntary winding up to be passed) before an employee can have access to the Insolvency Fund, a Government payment scheme which provides for the payment of certain employee entitlements, in the event of the insolvency of their employer.
The Central Bank of Ireland (CBI) recently published a consultation paper (CP69) on proposed changes to the Corporate Governance Code for Credit Institutions and Insurance Undertakings. The consultation period ends on 1 October 2013, following which, the CBI intends to publish the revised Code in December 2013. There will be a transitional period to allow institutions implement necessary amendments.
Notable proposed amendments to the Code include:
Chief Risk Officer (‘CRO’)
In the middle of the night back in February 2013 the Irish Bank Resolution Corporation Act 2013 (the IBRC Act) was passed by the Irish government. This Act allowed the Irish Minister for Finance to make a Special Liquidation Order winding up IBRC, being the former Anglo Irish Bank and Irish Nationwide Building Society. As a consequence of that KPMG in Dublin were appointed as Special Liquidators of IBRC.
The Foley’s/O’Reilly’s bar saga, which played out over a nine month period ending in July 2013, resulted in numerous court applications, three written judgments of the High Court and the appointment at various stages of receivers, interim examiners, examiners and liquidators to the companies involved.
Receivership
The manner in which creditors’ meetings are conducted can often be as significant as the actual outcome of the meeting. A good example of this can be seen from the recent High Court decision in In re Mountview Foods Ltd (In Voluntary Liquidation) [2013] IEHC 125.
The Minister of State for Housing and Planning, Jan O’Sullivan, TD, has announced that she is examining potential changes to the law to clarify the position of residential tenants where a receiver is appointed to rented accommodation. Concern has been expressed that there is a lack of clarity as to whether a receiver appointed to such a property assumes any of the responsibilities of the landlord or whether he should be solely concerned with recovering value from the asset, as would be conventional.