The Government has published the COVID-19 Response (Further Management Measures) Legislation Bill (the Bill), an omnibus bill containing amendments (both temporary and permanent) to several acts. These amendments aim to both assist organisations in effectively managing the “immediate impacts of the response to COVID-19”, as well as mitigating some of the pandemic’s “unnecessary and potentially longer-term impacts on society”.

The High Court appointed an examiner to three connected companies involved in the food distribution industry on 27 March 2020 in what was effectively the first examinership of the Covid-19 pandemic period.  Fieldfisher acted on behalf of Wert Capital Ltd which was the parent company for a number of food distribution entities in a successful application for court protection for the Group from their creditors.

High Court provides guidance on voluntary administration and creditors’ meetings under COVID-19 Alert Level 4

A recent decision of the High Court provides helpful guidance for insolvency practitioners on how aspects of the voluntary administration regime should operate in the context of the COVID-19 pandemic.

Christchurch based company Cryptopia Limited (in liquidation) (Cryptopia) operated a cryptocurrency exchange. Account holders were able to deposit cryptocurrencies into the exchange, and carry out trades with each other.

In January 2019 the exchange was hacked and cryptocurrencies valued at approximately NZD30m were stolen. Cryptopia closed after the hack, re-opened for a short period, and was then placed into insolvent liquidation in May 2019. David Ruscoe and Russell Moore of Grant Thornton New Zealand were appointed liquidators.

A recent decision of the High Court of New Zealand provides helpful guidance for insolvency practitioners on how aspects of the voluntary administration regime should operate in the context of the COVID-19 pandemic.

On 30 March 2020, the board of directors of EncoreFX (NZ) Limited resolved to appoint administrators to the company. By then, New Zealand was already at Level 4 on the four-level alert system for COVID-19.

A Members’ Voluntary Liquidation (“MVL”) is an efficient way to wind up a solvent company and release value to members. It is most often used where the directors wish to retire, the company has realised its potential or the company is dormant. By properly winding up the Company, the danger of the company being involuntarily struck off the Register of Companies and any resulting liability for the Directors is removed. A summary of the process is as follows:

It is almost 30 years since the commencement of the Companies (Amendment) Act 1990 (the “1990 Act”) which introduced the concept of Court protection for certain companies from their creditors to allow a formal restructure of a company’s debt. The examinership process is now governed by Part 10 of the Companies Act 2014 which mirrors the procedure provided for in the 1990 Act.   

Examinership process  

The UK Court of Appeal has held that legal privilege outlasts the dissolution of a company in Addlesee v Dentons Europe LLP [2019] EWCA Civ 1600.

Legal advice privilege applies to communications between a client and its lawyers. The general rule is that those communications cannot be disclosed to third parties unless and until the client waives the privilege.

In Secretary of State for Business, Energy and Industrial Strategy v PAG Asset Preservation Ltd [2019] EWHC 2890 the Secretary presented petitions under s 124A of the Insolvency Act 1986 to wind up two companies on public interest grounds. These companies were PAG Asset Preservation Limited and MB Vacant Property Solutions Limited (the Companies).

The Privy Council has rejected an attempt to block a cross-border liquidation on procedural grounds in UBS AG New York v Fairfield Sentry [2019] UKPC 20.