The High Court sanctioned Madagascar Oil Limited’s restructuring plan, exercising cross class cram down. The judgment deals with a few now familiar points: what is the relevant alternative? Can it be a different deal? As well as touching on a few novel ones in an unusual two class only plan: was there in fact an in the money class enabling cross class cram down? Almost a third of the judgment is devoted to international recognition and effectiveness of the plan in Madagascar and Mauritius, an unusually detailed analysis, but required here given the specific facts of the case.
In a significant further application of the Court of Appeal’s reasoning in Adler, Thames Water and Petrofac, the High Court declined to sanction a cross-class cram down restructuring plan proposed by Waldorf Production UK Plc.
On 12 June 2025, the Council of the EU announced that member states have agreed on a general approach to a directive aimed at bringing national insolvency standards closer together. This draft directive is designed to make the EU more attractive to foreign and cross-border investors by reducing the legal uncertainties and complexities associated with differing national insolvency laws.
Introduction
On 20 May 2025, Mr Justice Marcus Smith handed down his eagerly-awaited judgment sanctioning the two inter-conditional restructuring plans (the Plans) proposed by members of the Petrofac Group. The judgment raises issues described as “going to the heart of the Part 26A regime” and is significant as the first case to consider the application of the Court of Appeal’s ruling in Thames Water.
The judgment addresses three particularly interesting points:
On 8 April 2025, Mr Justice Marcus Smith delivered judgment granting Petrofac Limited and Petrofac International (UAE) LLC (the Plan Companies) permission to convene creditor meetings in respect of two inter-conditional restructuring Plans (the Plans). The fulsome judgment, following hearings on 28 February and 20 March, contains a number of interesting points:
“[T]his Court finds that the exceptions to discharge under §523(a) only apply to individuals in Subchapter V.”
- Spring, et al. v. Davidson and Blok Industries, Inc. (In re Davidson; In re Blok Industries, Inc.; Jointly Administered), Adv. No. 23-3005, Doc. 87, at 15 (Bankr., N.D. Fla., decided February 14, 2025).
Facts
- “While the pre-petition Debtor may have consented to waiver of the automatic stay in favor of [secured creditor], . . . other creditors did not”; and
- “The automatic stay is designed to protect both debtors and creditors alike.”
In re DJK Enterprises, LLC, Case No. 24-60126, Doc. 196, at 13 (Bankr., S.D. Ill., February 13, 2025).
In re DJK Enterprises
“[T]he appellant would not have acquired priority over other creditors by the sheriff’s levy, for the obvious reason that the right of property in the goods seized under the execution had previously passed” to the assignee under Debtor’s ABC.
- Reed v McIntyre, 98 U.S. 507, 512 (1878).
Facts
The Debtor, in the U.S. Supreme Court’s Reed v. McIntyre opinion, is a merchant.
Before 1998, (i) all student loans from for-profit lenders were dischargeable in bankruptcy, but (ii) student loans backed by the federal government or from non-profits were dischargeable in only these circumstances:
The Sino-Ocean restructuring plan is the first to be sanctioned in 2025 – but it starts the year off with a very interesting bang. In a relatively short (and commendably clear) judgment, the Court addresses head on: