In our update this month we take a look at some of the recent cases that will be of interest to those involved in insolvency litigation. These include:

The Court of Appeal considers 'reasonable adjustment' in the context of possession proceedings

The first case in which the Equalities legislation has been raised as a defence to a mortgagee's claim for possession has recently been before the Court of Appeal.

In the last week we have seen MPs criticise accountancy firms, KPMG, Deloitte, EY and PWC in their first report on the collapse of Carillion, describing the big four as “a cosy club” and calling for the firms to be forcibly broken up. Whilst not suggesting that the firms were to blame for the collapse, it is the level of fees reportedly paid to the firms which caught the MPs attention– £72 million in 10 years.

In our update this month we take a look at three cases that provide helpful clarification from the courts on issues that will be of interest to the insolvency and fraud industry - the key message from each case confirms:

Defendant's threat of insolvency did not prevent adjudicator's decision being enforced.

Gowling WLG's finance litigation experts bring you the latest on the cases and issues affecting the lending industry.

Interests of bankrupt's creditors remain paramount

In Pickard and another (Joint Trustees in Bankruptcy of Constable) v Constable, the question before the court was how exceptional the circumstances had to be to postpone an order for possession and sale of a property in which the bankrupt had a 50% share.

In our update this month we take a look at a case in which a non-party costs order was made against a major shareholder in the insolvent claimant company. The court found that the shareholder was the real party to the litigation; it funded the litigation, it was exercising control over the litigation and it would have been the main beneficiary had the litigation succeeded. We cover this, and other issues affecting the insolvency and fraud industry:

Montpelier Business Reorganisation Ltd v Jones & Others (2017)

Background

For decades, restructuring and insolvency matters in the Dominican Republic involving merchants and companies in non-regulated industries have been carried out on a “de facto” basis, due to the obsolescence of the existing legal framework and institutions. Fortunately, that is not the case anymore.

Air Berlin, one of Europe’s largest airlines, filed for insolvency on 15 August 2017. The airline, which is Germany’s second-largest carrier after Lufthansa, filed following the decision by Etihad Airways to pull financial support. Etihad owns 29% of Air Berlin and had been pumping money into the struggling airline for the past 6 years.

The Court of Appeal has confirmed that a term could not be implied into a conditional fee agreement between a liquidator and solicitors, and that the solicitors would only be paid out of recoveries made. However, the liquidator was not liable for the fees because of a common understanding between the parties. We cover this, and other issues affecting the insolvency and fraud industry, in our regular update:

This month we consider the court's refusal to imply an obligation into a loan agreement that a lender should take steps in foreign proceedings to preserve security; the court's view on the failure to heed alarm bells in relation to potential undue influence; and more cases and issues affecting the industry.

No implied term in a loan agreement that creditor should take steps in foreign proceedings to preserve security