The Supreme Court has confirmed that s.423 of the Insolvency Act 1986, which provides for the avoidance of certain transactions where they have been entered into for the purpose of defrauding creditors, has a broad application and covers not only transactions entered into by the debtor personally, but also those entered into via the debtor's company: El-Husseiny and another v Invest Bank PSC [2025] UKSC 4.
The High Court has held that the recognition of foreign insolvency proceedings under the Cross-Border Insolvency Regulations 2006 (the "CBIR") did not, in itself, vest rights or interests in English land in the foreign representative.
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When a company is in financial distress, directors face difficult choices. Should they trade on to try to “trade out” of the company’s financial difficulties or should they file for insolvency? If they act too soon, will creditors complain that they should have done more to save the business? A recent English High Court case raises the prospect of directors potentially being held to account for decisions that “merely postpone the inevitable.”
In a rare case, the High Court has dismissed an application by liquidators pursuant to sections 235 and 236 of the Insolvency Act 1986, which give office-holders broad powers to obtain information and documents concerning the company and its affairs: Webb v Eversholt Rail Limited [2024] EWHC 2217 (Ch).
A Hong Kong court has refused to sanction a scheme of arrangement, saying that practitioners should explain the key terms and effect of any proposed restructuring in a way which can be easily understood by the creditors and the court.
In Re Sino Oiland Gas Holdings Ltd [2024] HKCFI 1135, the Honourable Madam Justice Linda Chan refused to sanction a scheme of arrangement, saying that creditors had been given insufficient information about the restructuring and the scheme that would enable them to make an informed decision at the scheme meeting.
The Hong Kong Court of Appeal has finally laid to rest the vexed issue of whether an arbitration agreement or a winding-up petition should take precedence in an insolvency situation. In two parallel decisions, the Court of Appeal ruled that an arbitration agreement should be treated in the same way as an exclusive jurisdiction clause and that the principle should be given a wide interpretation.
The Hong Kong High Court has given a rare order for modifications to a scheme of arrangement after it had been implemented incorrectly by the scheme administrators. Drawing on instances in which the English courts have sanctioned modifications after approval by scheme creditors, the court held that the same principles apply here.
The Hong Kong court has granted an order forcing an uncooperative former director of a Hong Kong listed company to ratify the appointment of a Hong Kong liquidator as the sole director of the companies' four BVI subsidiaries. The court rejected the idea that the liquidators should be made to apply for fresh winding up orders in the BVI and stressed that courts should be ready to offer each other mutual assistance.
The High Court has held that there is no common law rule preventing enforcement of a foreign judgment in England and Wales simply because it is not presently or fully enforceable in the relevant foreign jurisdiction.