Summary
The Supreme Court held that when directors know, or ought to know, that the company is insolvent or bordering on insolvency, or that an insolvent liquidation or administration is probable, they must consider the interests of creditors, balancing them against the interests of shareholders where they may conflict. The greater the company’s financial difficulties, the more the directors should prioritise the interests of creditors.
Background
The Bankruptcy Protector
Bankruptcy Basics for New and Non-Bankruptcy Attorneys
This entry is part of Nelson Mullins’s ongoing “Bankruptcy Basics” blog series that is intended to address foundational aspects of bankruptcy for non-bankruptcy practitioners and professionals. This entry will discuss sales of assets “free and clear” under section 363 of the Bankruptcy Code.
The Bankruptcy Protector
Bankruptcy Basics for New and Non-Bankruptcy Attorneys
This entry is part of Nelson Mullins’s ongoing “Bankruptcy Basics” blog series that is intended to address foundational aspects of bankruptcy for non-bankruptcy practitioners and professionals. This entry will discuss how ipso facto clauses are treated in bankruptcy.
Imagine you are the vendor to an entity that has just filed for protection under chapter 11 of the Bankruptcy Code. Your contract documents include the following default provision:
On 22 July 2022 and after the judge ordered a delay for more evidence, the English court sanctioned the restructuring plan proposed by Houst Limited (Houst). Houst is an SME that is concerned with the provision of property management services for short-term/holiday lets. Its business was badly affected by the Covid-19 pandemic, meaning it was both cash flow and balance sheet insolvent when proposing the plan.
Cryptoassets continue to be in the spotlight with prices no longer heading ‘to the moon’, the recent high-profile failure of an algorithmic stablecoin and the difficulties experienced by various service providers. This all forms the backdrop to the UK Government’s publication of proposals with respect to managing the failure of systemic digital settlement asset firms.
Overview
On 18 March 2021, the UK Government published its white paper on restoring trust in audit and corporate governance. On 31 May 2022, the Government published its response to the consultation.
The Bankruptcy Protector
Bankruptcy Basics for New and Non-Bankruptcy Attorneys
This entry is part of Nelson Mullins’s ongoing “Bankruptcy Basics” blog series that is intended to address foundational aspects of bankruptcy for non-bankruptcy practitioners and professionals. This entry will discuss lease rejection in chapter 11 bankruptcy cases.
The Bankruptcy Protector
How A Subchapter V Case Filed by Controversial Alex Jones Could Shape the Scope of Subchapter V Cases
On 30 March 2022, the English court sanctioned the most recent restructuring plan proposed by Smile Telecoms Holdings Limited (Smile).