Introduction The UK Government has announced that it will be introducing legislation under which the UK tax authorities1 will move up the creditor hierarchy in English insolvency proceedings2 in respect of certain taxes paid by
Introduction
In the recent case of Global Corporate Ltd v Hale , the Court of Appeal was asked to assess whether sums, described as “interim dividends”, paid to Mr. Hale (the “Respondent”) in his capacity as both a director and shareholder of Powerstation UK Limited (the “Company”), had been made in accordance with section 830 of the Companies Act 2006 (the “Act”) prior to the Company’s insolvency.
The High Court has formally adopted new guidelines approved by the fledgling Judicial Insolvency Network (“JIN”) designed to encourage and enhance communication between courts where parallel insolvency proceedings have been commenced in different jurisdictions (the “Guidelines”).
In Re DTEK Finance BV,1 the English High Court decided that a change in the governing law of bonds from New York to English law, established a sufficient connection with the English jurisdiction for it to sanction the bonds' restructuring via a UK scheme of arrangement.
Background
The Supreme Court (unanimously dismissing the appeal in Trustees of Olympic Airlines SA Pension &Life Assurance Scheme v Olympic Airlines SA) has held that “economic activity” is central to the definition of “establishment” in the Insolvency Regulation1.
Changes may be coming to the Bankruptcy Code’s safe harbor provisions.[1] In 2012 the American Bankruptcy Institute established a Commission to Study the Reform of Chapter 11 (the “ABI Commission”), composed of many well-respected restructuring practitioners, including two of the original drafters of the Bankruptcy Code, whose advice holds great weight in the restructuring community.
The High Court has rejected the argument that amounts owing to British Gas Trading Ltd (BGT) under post-administration, deemed contracts for the provision of gas and electricity are automatically classed as expenses of the administration. The court has reserved for consideration, however, whether and if so how an administrator’s conduct may give the liability super priority or bring the salvage principle into play.
Background and preliminary issue
A bankruptcy judge in the Southern District of New York recently held that section 546(e) of the Bankruptcy Code does not prevent a debtor’s creditors from bringing state-law fraudulent conveyance actions that challenge a leveraged buyout of the debtor. Weisfelner v. Fund 1 (In re Lyondell Chem. Co.), No. 10-4609 (REG), --- B.R. ----, 2014 WL 118036 (Bankr. S.D.N.Y. Jan. 14, 2014).
TheLehman Brothers bankruptcy court has determined that the contractually specified methodology for conducting the liquidation of a swap agreement is protected by the safe harbor provisions of the bankruptcy, even if the selected methodology would be more favorable to the non-defaulting counterparty than the liquidation methodology that would apply absent the bankruptcy.See Michigan State Housing Dev. Auth. v. Lehman Bros. Deriv. Prods. Inc. (In re Lehman Bros. Holdings Inc.), No. 08-13555, ---B.R.
In a case of importance to foreign representatives of foreign debtors seeking the assistance of US courts pursuant to chapter 15 of the Bankruptcy Code, the US Court of Appeals for the Second Circuit has held that the debtor eligibility requirements of section 109(a) of the US Bankruptcy Code apply in cases under chapter 15 as they would in cases under other chapters of the Bankruptcy Code. The decision in Drawbridge Special Opportunities Fund LP v. Barnet (In re Barnet), Case No. 13-612 (2d Cir. Dec.