The Insolvency Service is satisfied that the restructuring plan and moratorium processes are broadly meeting their policy objectives – and that ipso facto clauses are likely to be used more in future

The High Court has held that disclosure of debts and undertakings given to the Circuit Court in seeking a protective certificate for a personal insolvency arrangement can be relied on in other proceedings.

Background

The McLaughlins were engaged in a long running saga of litigation with Bank of Scotland plc (“BOS”) and, after a loan sale, Ennis Property Finance Limited (“Ennis”).

In 2016 they issued High Court proceedings against Ennis and Tom Kavanagh (the “Plenary Proceedings”).

Some of the UK Government’s COVID-19 supports for businesses came to an end, or started to taper off, on 30 September 2021. The UK Insolvency service published statistics yesterday showing that the number of corporate insolvencies has returned to pre-pandemic levels. There is no reason to believe that the Irish position will be substantially different when supports come to an end.

What happened when COVID-19 struck?

The recent restructuring of the Norwegian Group by the Irish High Court helpfully clarifies the application of the Cape Town Convention in Irish restructuring. It is also an interesting case study regarding the circumstances in which the Irish courts will restructure a group of companies, which is not headquartered in Ireland.

The High Court refused to appoint an examiner to New Look Retailers (Ireland) Ltd (New Look), where it transpired that it had sufficient funds to survive for a number of months but had not engaged substantively with creditors before applying for the appointment of an examiner.

Background

New Look operates 27 stores in Ireland, all of which are rented. It closed its stores 2 days before the Government mandated lockdown in March.

Late in the evening on 30 July, the last day before its summer break, the Irish parliament (Oireachtas) passed the Companies (Miscellaneous Provisions) (Covid-19) Bill 2020. This is likely to be signed into law and commenced within two weeks.

Three of its provisions are particularly relevant to insolvency processes during the COVID-19 crisis.

Creditors’ meetings

New legislation ushers in the largest change in the UK’s corporate insolvency regime in over 20 years and raises questions for pension schemes.

Fast-tracked through Parliament in the wake of the Covid-19 emergency, the Corporate Insolvency and Governance Act 2020 came into force on 26 June 2020. It brings in some temporary measures designed to support businesses affected by the pandemic and changes that have been expected for a while. We look at five aspects of the Act that the trustees and employers of UK pension schemes will need to know about.

The long-awaited revamp of UK insolvency and corporate governance law has introduced significant changes to the effectiveness of termination on insolvency clauses in supply contracts.

The long-awaited revamp of UK insolvency and corporate governance law will introduce significant changes to the effectiveness of termination on insolvency clauses in supply contracts.

The Office of the Director of Corporate Enforcement (ODCE) has provided guidance on its approach to directors of companies, made insolvent by the COVID-19 pandemic, who act in good faith on objective evidence in trying to rebuild their businesses.

The issue

The consequences of the COVID-19 crisis have made many businesses that were solvent, and will likely become solvent again, technically insolvent.