On 12 August 2020, we wrote about three important judicial decisions of the courts in England and Singapore relating to the enforcement of arbitration agreements over claims arising under insolvency laws.

Last February, we blogged about the Third Circuit’s decision in In re Energy Future Holdings Corp, No. 19-1430, 2020 U.S. App. LEXIS 4947 (Feb. 18, 2020). The Third Circuit approved a process for resolving asbestos claims in which a bar date was imposed on filing the claims, but late claimants who were unaware of their asbestos claims would be allowed to have the bar date excused through Bankruptcy Rule 3003(c)(3). (A bar date is a date set by the court by which all claims against the debtor must be filed.

The increasing number of high-profile bankruptcies across a number of commercial hubs has brought renewed focus on important questions of jurisdiction arising out of the tension between local insolvency regimes on the one hand, and parties’ arbitration agreements on the other.

Section 550 of the Bankruptcy Code provides that, when a transfer is avoided under one of several other sections of the Code, a trustee may recover “the property transferred, or, if the court so orders, the value of such property” from “the initial transferee of such transfer,” “the entity for whose benefit such transfer was made,” or “any immediate or mediate transferee of such initial transferee.” 11 U.S.C. § 550(a).

Recent insolvencies remind us that, when a seller of goods is unpaid, the question of possession leaps to the foreground. There is little value in a claim against an insolvent buyer for damages or for the price.

The UK Department for Business, Energy and Industrial Strategy introduced the Corporate Insolvency and Governance Bill (the Bill)¹ into Parliament on 20 May 2020. The Bill is due to proceed through Parliament on an accelerated timetable and is expected to come into force without changes towards the end of June 2020.

Zenrock Commodities Trading Pte Ltd is one of the latest additions to the increasing list of commodities traders in Singapore making recent headlines, with financial difficulties and malpractice allegations coming to light. The COVID-19 crisis, oil price volatility and slumping demand are acting as a catalyst, and are affecting a majority of oil majors and traders in Singapore and the region.

Courts reviewing a bankruptcy court’s decision to approve a chapter 11 reorganization plan over the objections of an interested party must consider not only the merits, but also (if implementation of the plan was not stayed) potential injury to the reliance interests of other parties relying on the plan. These issues are confronted in Drivetrain, LLC v. Kozel (In re Abengoa Bioenergy Biomass of Kansas), 2020 WL 2121449 (10th Cir.

In the light of increased volatility across many markets and disruptions to economic activity, parties to transactions that are subject to ISDA Master Agreements¹ will need to think about what strategies they would adopt if an Event of Default occurs with respect to their counterparties.

Choices

This note sets out the circumstances in which a creditor may successfully lift a statutory moratorium against a company in administration in England and Wales, and in Singapore.

English law