On 1 June 2017 a new law came into effect in New South Wales relevant to liquidators’ rights to directly pursue the insurer of a proposed defendant, taking away significant uncertainty which existed previously because of antiquated provisions in a 1946 act relating to charges over and priorities to those insurance monies.

The new law now provides greater certainty for liquidators in deciding whether to bring proceedings directly against the insurers of directors and officers or indeed of other third parties against whom the liquidators may have claims.

The High Court has recently expressed concern that distressed borrowers are being duped into paying money to the anonymous promoters of schemes, which purport to protect them from enforcement by lenders but are actually ‘utterly misguided and spurious’.

There are a number of schemes being promoted at the moment that supposedly protect borrowers in arrears from enforcement by their lender.

Simple retention of title clauses are commonplace and generally effective in contracts for the sale of goods. However, extending their effect to the proceeds of sale of such goods requires careful drafting.

The Court of Appeal has provided some further clarity around the creation and effects of fiduciary obligations in relation to such clauses.[1]

Proceeds of sale clauses

The High Court has reiterated that cross-examination will not generally be permitted on an interlocutory application, or where there is no conflict of fact on the affidavits.

In McCarthy v Murphy,^[1] the defendant mortgagor was not permitted to cross-examine the plaintiff (a receiver) or a bank employee who swore a supporting affidavit.

Background

Two recent judgments have brought further clarity in relation to the rights acquirers of loan portfolios to enforce against borrowers:

In AIB Mortgage Bank -v- O'Toole & anor [2016] IEHC 368 the High Court determined that a bank was not prevented from relying on a mortgage as security for all sums due by the defendants, despite issuing a redemption statement which omitted this fact.

In order to understand this case, it is necessary to set out the chronology of events:

Bankruptcy law in Ireland is now, broadly speaking, in line with that of the United Kingdom.

In particular, for bankrupts who cooperate with the bankruptcy process:

• bankruptcy will end in one year; and
• their interest in their family home will re-vest in them after 3 years.

Notably however, the courts will have discretion to extend the period of bankruptcy for up to 15 years for non-cooperative individuals and those who have concealed or transferred assets to the detriment of creditors.

The Supreme Court has held that a floating charge, crystallised by notice, prior to the commencement of a winding up, ranks ahead of preferential creditors. However, the Court expressed the view that the relevant legislation needs to be amended to reverse the “undoubtedly unsatisfactory outcome”.

Background

On 13 May 2015, the Government announced that it intends to give the courts the power to overrule the rejection by secured creditors of arrangements under the Personal Insolvency Act 2012 (the “Act”).

There is scant detail in the announcement save that it is intended to “support mortgage holders who are in arrears” and that legislation is to be brought forward before the Summer recess. How is such legislation likely to work and what potential frailties could it have?

The Issue

Insolvency practitioners often encounter difficulties when trying to sell properties in residential developments because an original management company has been struck off the Register of Companies. The standard approach can be laborious and costly. A more cost efficient alternative is often available.