R (on the application of Palmer) (Appellant) v Northern Derbyshire Magistrates’ Court and another (Respondents) [2023] UKSC 38

On appeal from: [2021] EWHC 3013

New data from UHY Hacker Young has found that UK restaurant insolvencies have increased by 64% in the last year... and it isn't just Covid that's to blame (though undoubtedly it is a factor). As eloquently put by a partner at UHY: "The restaurant sector has emerged from one crisis only to face an onslaught of other challenges."

Aviation news this week reports that Jota Aviation has an administration on the cards - big news for the premier league clubs (understood to include Chelsea, Arsenal, Manchester City, Liverpool and Manchester United) who rely on its services to jet them between their all important games.

Jota's administration isn't noted on Companies House or the public Court records just yet but they have cancelled all flights, suspended all services and offered it's three freight aircraft up for sale - all certainly indicative of an intention to cease trading.

The Financial Conduct Authority has announced this week that Insolvency Practitioners at Teneo Financial Advisory Limited have been appointed as special administrators following Sberbank CIB's entry into special administration.

The case of Re Premier FX Limited (in Liquidation) highlights the potentially dire consequences for a creditor who does not file their proof of debt by a set deadline - and makes clear that mistakenly forgetting to do so is not a sufficient excuse.

Premier FX was in business as a foreign exchange dealer and money transfer agent. Financial advice was sought when it became clear to the (newly appointed) directors that the claims received from customers exceed the balance of the funds held by the company.

A pizza boss has been handed an eight-year director disqualification for failing to maintain adequate records to explain how a £50,000 bounceback loan was used.

R (on the application of Palmer) v Northern Derbyshire Magistrates’ Court [2021] EWHC 3013

The case of Palmer has confirmed that an insolvency practitioner in the role of an administrator can be prosecuted (and therefore personally liable) for a failure to follow correct redundancy procedures prescribed by s194 TULRCA.

Where an individual is found to have acted in breach of s194, they may be personally liable to an unlimited fine (or a fine of up to £5,000 if the offence is committed before 12 March 2015).

The facts

Despite calls upon the government to intervene and, later, attempts to sell the business, the South West construction firm Midas has collapsed into administration this week.

The collapse of the business has led to over 300 redundancies, though it is understood that a section of the business (Mi-Space) has been sold, saving over 50 jobs. Concerns have also been raised about the knock-on effort on sub-contractors and connected businesses, many of whom have been left out of pocket through unfulfilled contracts and unpaid invoices.

When the availability of bounceback loans was announced, it was heralded as the way for small businesses to quickly and easily access loans of between £2,000 and £50,000 during the COVID pandemic. Undoubtedly, it has helped a significant number of small businesses to weather the storm that COVID brought on many.

The temporary restrictions on winding-up petitions brought in under the Corporate Insolvency and Governance Act 2020 (“CIGA”) are wider than originally envisaged when first announced by the government in April 2020 and have now been extended until 30 September 2021.