It was a painful outcome for the administrator of ARY Digital UK Limited (“ARY”) when he was found in breach of duty and liable to pay £743,750.

The case of Brewer and another (as joint liquidators of ARY Digital UK Ltd) vIqbal [2019] EWHC 182 (Ch) reminds office holders of the importance of understanding what assets they are selling, ensuring that correct marketing processes are employed and obtaining proper valuations.

The dialogue is changing yet is the law enabling the practical change Directors need?

Achieving significant cultural shift in any business environment is no easy task, so it’s by no means ground-breaking to declare that after 1 year in operation, it still cannot be said that the new “Safe Harbour” legislation has resulted in a cultural change among directors.

Administrators are statutorily entitled to require a receiver to vacate office (paragraph 41 Schedule B1 Insolvency Act 1986 (“Schedule B1”)). In Promontoria (Chestnut) Ltd vCraig and another [2017] EWHC 2405 (Ch) they did just that, taking steps to remove existing receivers not long after their appointment, claiming the action to be in the interests of all the creditors. On the facts, that decision was not only unreasonable but costs were also awarded personally against the administrators.

Brief facts and arguments

The Senate Legal and Constitutional Affairs Legislation Committee (“the Committee”) has endorsed the passing of the Bankruptcy Amendment (Enterprise Incentives) Bill 2017 (“the Bill”) in its report dated 21 March 2018.[1]

The Queensland Court of Appeal has upheld an appeal by the liquidators of Linc Energy Limited (In Liquidation) (“Linc”) and given full effect to their disclaimer of contaminated mining property and onerous obligations the subject of an environmental protection order (“EPO”) issued by the Queensland Department of Environment and Science (“DES”).[1]

VE Vegas Investors IV LLC and others vs Shinners and others [2018] EWHC 186 Ch

Background

The applicants were creditors of VE Interactive Limited (In administration) (“VE”). VE encountered financial difficulties and its directors sought insolvency advice from insolvency practitioners at Smith and Williamson (“S&W”) and appointed them to advise on and effect a pre-pack sale of VE’s business and assets.

In the recent case of Cherkasov & others v Olegovich [2017] EWHC 756 (Ch) the English courts considered the public policy exception set out in Article 6 Cross Border Insolvency Regulations 2006 (CBIR) and whether security for costs could be ordered against the official receiver of a Russian company (who had obtained recognition in England under CIBR) when he applied for an order for the production of evidence by some of the former managers of a Russian company under section 236 of the Insolvency Act 1986 (IA).

The English courts have recently wrestled with the Cross Border Insolvency Regulations 2006 (“CBIR”) in a case about the lifting of the automatic stay on proceedings against Korean company STX Offshore & Shipbuilding Co Ltd

On 28 March 2017, the Turnbull Government released draft legislation which would implement wide-ranging reforms to Australia’s corporate restructuring laws. The draft legislation focuses on reforms to the insolvent trading prohibition (Safe Harbour) and introducing a new stay on enforcing “ipso facto” clauses during certain restructuring procedures (Ipso Facto).

The recent Chancery Division judgment in Re Gracio Property Company Limited [2017] B.C.C 15 (“Gracio”) saw the court make an order for a compulsory liquidation without any winding-up petition having been issued.

The facts