Introduction

Introduction

After much anticipation, the UK Supreme Court has handed down its judgment in BTI 2014 LLC v Sequana S.A. [2022] UKSC 25 - and has authoritatively set the baseline for how directors’ duties evolve as regards shareholders and creditors’ interests when a company is in the zone of insolvency.

Background

The Supreme Court has unanimously dismissed the appeal of the decision in BTI –v- Sequana.

At a time when many companies are facing financial difficulties and directors are considering their legal duties, this long-awaited judgment has confirmed that directors have a 'creditor interest duty' when a company is insolvent or bordering on insolvency or an insolvent liquidation or administration is probable.  

Background

The recent High Court decision in Re Nostrum Oil & Gas plc [2022] EWHC 2249 (Ch) considers a scheme of arrangement where creditors are the target of Russian sanctions. 

Background 

The full strength of the economic headwinds facing the UK economy is not yet clear, but a helpful recent report by insolvency and restructuring adviser Begbies Traynor provided some useful numbers around the attitudes of businesses.

The recent High Court decision in Re Petropavlovsk Plc [2022] EWHC 2097 (Ch) considers the interaction of UK insolvency procedure and the sanctions regime imposed on Russia. 

Background 

Administrators were appointed to the English holding company of Russian gold mining group, Petropavlovsk Plc, in July 2022. The holding company was not sanctioned but sanctions had affected its ability to refinance and to pay its debts as they fell due.

On 15 August 2022, the UK High Court handed down judgment in Oceanfill Ltd v Nuffield Health Wellbeing Ltd and Cannons Group Ltd.

Background

The claim was for rent and other arrears by Oceanfill, the landlord of a gym in Leeds. It was brought against Nuffield, the original tenant and Cannons, the original guarantor under the lease.

Nuffield had assigned the lease to Virgin Active in 2000, guaranteeing the performance of Virgin Active as tenant and Cannons had given a guarantee of Nuffield's obligations.

Virgin Active restructuring plan 

In Re Swiss Cottage [2022] EWHC 1495 (Ch), junior creditors argued that administrators appointed to two companies had exceeded their powers and breached their duties when selling two properties.

Background

Overview  

In a recent decision of the Grand Court of the Cayman Islands (the “Court”) concerning a supervision order in respect of a Cayman company in voluntary liquidation, Kawaley J considered the settled principles in a solvent Cayman Islands liquidation involving a dispute as to the identity of the official liquidators to be appointed.

The Proceeding