InJ.D. Brian Ltd (in liquidation) & Others the High Court held that, where a floating charge crystallised prior to the commencement of a winding-up, the preferential creditors still had priority pursuant to in section 285 of the Companies Act 1963 over the holder of what had become a fixed charge.

The English court of appeal has held that a company should not be held to be balance sheet insolvent on the sole basis that its liabilities (including contingent and prospective liabilities) exceed its assets.

In BNY Corporate Trustee Services v Eurosail & Ors, the Court of Appeal considered in detail, for the first time, the construction of section 123 of the UK Insolvency Act 1986, which sets out circumstances in which a company can be deemed to be unable to pay its debts.

The relevant portions of section 123 provide as follows:

The Irish President has signed the Credit Institutions (Stabilisation) Act 2010 (the Act) into lrish law. The Act grants far reaching and unprecedented powers to the Irish Minister for Finance to facilitate the restructuring and stabilisation of the troubled Irish banking sector.

The intellectual property (IP) rights that protect key software, brands and technical processes can be amongst the most valuable assets of a company. But what happens to IP rights when a company becomes insolvent? What happens to the insolvent company's licences, and to its licensees who may have invested significant amounts of time and money in setting up manufacturing facilities to exploit the licensed technology or in advertising under a particular trade mark?

The Law Reform Commission (LRC) launched its Report on Personal Debt Management and Debt Enforcement, on 16 December 2010, at its Annual Conference. The Report makes 200 recommendations for reform, and also contains a draft Personal Insolvency Bill. Reform of personal debt law must be introduced next year to comply with the Government's agreement with the International Monetary Fund and the European Central Bank.

In Re McInerney Homes Limited

In the McInerney case, the company and the examiner sought to have schemes confirmed which would result in an immediate payment to a banking syndicate of €25 million. The banking syndicate contended that the discounted current value which they expected to recover from their security outside any schemes was €50 million.

Kerr & Ors v Conduit Enterprises Ltd

In 1997 the two directors of the company and others purchased a building and leased it to the company. Ownership of the company changed hands a number of times and, in 2008, the then new owners purported to void the lease on the basis that it had never been approved by shareholder resolution. The landlords issued proceedings seeking a declaration that the lease was valid.

The court held that:

On 15 April 2010, the High Court confirmed the appointment of a full-time administrator to Quinn Insurance, Ireland’s second largest insurance company. Though the Quinn Group briefly fought against the proposed administration, it ultimately withdrew its objection and conceded the appointment. The insurance company is now being run by two outside managers, who will run the business as a going concern in an effort to get it back on a secure financial footing.

The rapid downturn in the economy means company directors are faced with new challenges, possibly on a greater scale and more complex than ever before. Directors are responsible for managing the affairs of a company, identifying risk and ensuring that there is a strategy and a system in place to deal with those risks.

Weak and inadequate management by the directors may contribute to a weak financial performance and can lead to damage to business reputation, adverse media attention and damage to the business itself.

Assess the petition documents. Do these demonstrate a clear basis for the
survival of the enterprise?