The Ministry of Business, Innovation and Employment (MBIE) is seeking submissions by 7 October on recommendations from the Insolvency Working Group.
We canvass the issues. Michael Arthur of Chapman Tripp is a member of the Working Group.
The Pension Protection Fund (PPF) is reviewing its insolvency risk model with Experian. The proposals being considered are particularly relevant to the financial services and charity sectors. It is proposed they be introduced from 2018/2019 (and will not be part of the draft levy rules and levy estimate for 2017/18, which we expect will contain few changes).
In summary, the PPF is considering:
When the board of Hanjin Shipping voted unanimously to file for receivership at the end of August, it precipitated the largest container line bankruptcy in history. The collapse of the company is partly due to the pressure on the shipping industry, which has been unrelenting since the 2008 financial crash. Much of this has to do with the increase in capacity in the industry – vessels built in the 1990s typically carried around 2,000 TEUs; by 2015 this had increased to 10,000.
Introduced by the Corporate Insolvency and Governance Act 2020, the restructuring plans regime set out in Part 26A of the Companies Act 2006 (Plans) has quickly proven a popular route for corporate financial rescue. This is in large part due to the fact that it allows for a plan to be imposed upon dissenting creditor classes in certain circumstances. This is known as "cross-class cramdown".
Summary
Welcome to the Corporate Briefing, where we review the latest developments in UK corporate law that you need to know about. In this month’s issue we discuss:
As practitioners we pour over notices of intention to appoint (NOIA) and notices of appointment of administrators (NOA) to make sure every detail is accurate. Why? Because no one wants to risk an invalid appointment because there was a minor mistake or error that was overlooked. Understandably errors occur, particularly when the appointment of administrators often happens at speed, with all parties inevitably juggling many balls. Prescribed information may have been missed, or incorrectly stated and procedural steps may have been inadvertently forgotten.
In Tynefield Care Ltd (and others) v the New India Assurance Company Ltd1 the indemnity claims of the insured Claimant companies were dismissed, and policies avoided from inception for breach of the duty of fair presentation under the Insurance Act 2015. The breach related to the insolvency history of one of the de facto or shadow directors of the Claimant companies.
This judgment therefore adds to the post-2015 Act case law considering breach of the duty of fair presentation.
Our series focused on privacy and transparency considers issues encountered by practitioners across a range of different dispute resolution specialities. This article provides a reminder for Insolvency Practitioners about their obligations when processing personal data.
Welcome to the first issue of Insolvency Matters, our round-up of recent legal developments affecting insolvency and restructuring.
Case round-up
For those that are that way inclined (which includes us at #SPBRestructuring!), the 500 plus page Wright v Chappell judgment which sets out the BHS wrongful trading claim against its former directors makes for an interesting read. It paints a colourful picture of the downfall of the BHS group, from the point that it was sold for £1 to its eventual demise into administration and then liquidation. You can make your own mind up about the characters involved, but the story is a sorry one, with creditors ultimately suffering the most.