There are many enforcement options available to commercial landlords in England & Wales, to recover rent arrears due under a lease from a business tenant. Some of those options are based in contract and governed by the terms of the individual lease itself, such as a power to forfeit or damages for breach, whilst some of those options are based in statute such as the Commercial Rent Arrears Recovery regime.

When an individual or company purchases property in England or Wales, the legal title will transfer once the purchaser is listed as the registered proprietor at the Land Registry. However, what happens when, pending the registration of the legal interest, the seller company (who is still the registered proprietor) is dissolved? This is a risk seldom contemplated when purchasing property, but can have important consequences for the title of the property.

This question had until recent times been a conundrum of modern fixed charge receiverships (as well as receivers appointed under the Law of Property Act 1925), because in the scenario of the receiver seeking to step in and deal with property, the receiver is also said to be the borrower's deemed agent. It therefore begged a thorny question of the receiver, about how to reconcile being on both sides of the possession action.

There are significant differences in the procedures available to lenders north and south of the border when it comes to enforcing fixed charges or standard securities over real/heritable property. In this blog, we will compare the process in England & Wales ("E&W") of appointing a fixed charge or "LPA" receiver with the Scottish calling-up procedure

England & Wales: LPA receivers

The Bankruptcy Code confers upon debtors or trustees, as the case may be, the power to avoid certain preferential or fraudulent transfers made to creditors within prescribed guidelines and limitations. The U.S. Bankruptcy Court for the District of New Mexico recently addressed the contours of these powers through a recent decision inU.S. Glove v. Jacobs, Adv. No. 21-1009, (Bankr. D.N.M.

Challenging a Tenant CVA

Company Voluntary Agreements ("CVAs") have been the go-to option for struggling retail businesses over the pandemic period. While all creditors are generally treated equally under a CVA, landlords are increasingly finding themselves at the short end where they are the only, or one of, a very small pool of, creditors taking a hit. It is now more important than ever that a landlord knows the circumstances by which they can challenge a tenant's CVA.

In In re Smith, (B.A.P. 10th Cir., Aug. 18, 2020), the U.S. Bankruptcy Appellate Panel for the U.S. Court of Appeals for the Tenth Circuit recently joined the majority of circuit courts of appeals in finding that a creditor seeking a judgment of nondischargeability must demonstrate that the injury caused by the prepetition debtor was both willful and malicious under Section 523(a)(6) of the Bankruptcy Code.

Factual Background

In a recent decision, the U.S. Bankruptcy Court for the Southern District of New York held that claim disallowance issues under Section 502(d) of the Bankruptcy Code "travel with" the claim, and not with the claimant. Declining to follow a published district court decision from the same federal district, the bankruptcy court found that section 502(d) applies to disallow a transferred claim regardless of whether the transferee acquired its claim through an assignment or an outright sale. See In re Firestar Diamond, 615 B.R. 161 (Bankr. S.D.N.Y. 2020).

InIn re Juarez, 603 B.R. 610 (9th Cir. BAP 2019), the Bankruptcy Appellate Panel of the U.S. Court of Appeals for the Ninth Circuit addressed a question of first impression in the circuit with respect to property that is exempt from creditor reach: it adopted the view that, under the "new value exception" to the "absolute priority rule," an individual Chapter 11 debtor intending to retain such property need not make a "new value" contribution covering the value of the exemption.

Background

In In re Palladino, 942 F.3d 55 (1st Cir. 2019), the U.S. Court of Appeals for the First Circuit addressed whether a debtor receives “reasonably equivalent value” in exchange for paying his adult child’s college tuition. The Palladino court answered this question in the negative, thereby contributing to the growing circuit split regarding the avoidability of debtors’ college tuition payments for their adult children as constructively fraudulent transfers.

Background