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.
In Minor Hotel Group MEA DMCC v Dymant & Anor [2022] EWHC 340 (Ch), is the first reported High Court decision considering a contested moratorium since the new Part A1 moratorium ("moratorium") was introduced in 2020, in which the monitors successfully opposed an application by the parent company's secured creditor to remove the monitors and end the moratorium.
In the first of our short videos in relation to business recovery and resilience, John Alderton (Partner in our Restructuring & Insolvency team), responds to the question:
‘There hasn’t been a wave of insolvencies, is business stress still there or are we through the worst of it?’
Please click here to listen to John’s answer.
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.
Opening the door for the SME market, Sir Alistair Norris has sanctioned the first ever restructuring plan for a “mid-market” company. The plan sanctioned in Amicus Finance PLC (in administration) is also the first restructuring plan proposed by insolvency practitioners and the first to cram down a secured creditor.
The sanction judgment is short, but the adjourned convening hearing that was dealt with by Mr Justice Snowden (the first hearing was before Mr Justice Trowers) gives some insight into the plan.
CVAs are a useful tool in the restructuring tool kit, and may prove extremely helpful to retailers or hospitality companies as a means of supporting those businesses as they emerge from the pandemic. The flexibility of a CVA and the ability to shape the terms of a proposal to meet the specific needs of a business have seen an increasing number of consumer led businesses use CVAs, and they have become popular as a means to restructure businesses that have a significant lease portfolio.
Following our previous alert that considered rent reductions and modifications to lease terms post New Look and Regis, this alert considers what those CVA challenge cases tell landlords about calculating a landlord's claim for voting purposes and the disclosure requirements.