Are the courts of England and Wales establishing themselves as a flexible forum for cross-border enforceability? Here, we consider this question in light of two recent High Court decisions: Re Silverpail Dairy (Ireland) Unlimited Co. [2023] EWHC 895 (Ch) (Silverpail) and Invest Bank PSC v El-Husseini & Ors [2023] EWHC 2302 (Comm) (Invest Bank).

The 11 October 50-page judgment of Hildyard J in The joint administrators of Lehman Brothers International (Europe) v FR Acquisitions Corporation (Europe) and JFB Firth Rixson will interest not only those who deal with ISDA Master Agreements (who may want to read the entire judgment), but also many lawyers and financial and commercial institutions. This is because the events of default which it had to consider, and especially the meaning of the word “continuing” in this context, are relevant to bonds, loans and various commercial contracts.

The EU Directive on restructuring and insolvency was published in the OJEU on Wednesday. Members states have until 17 July 2020 to implement it, and this includes the UK as it stands: the UK has much – but not all – of it already. The UK Government has its own plans for reforming insolvency law of course, including to re-introduce Crown Preference. It is mostly about creating a rescue framework.

The Dutch Supreme Court has confirmed the decision of the Amsterdam Court of Appeal, which found that the bankruptcy of the Russian based oil company, Yukos, could not be recognised in the Netherlands because it violates Dutch public policy.

The High Court of Hong Kong refused to allow a Chapter 11 Trustee to disclose a Decision from Hong Kong winding up proceedings in the US bankruptcy court. The US proceedings were commenced to prevent a creditor from taking action following a breach of undertakings given to the Hong Kong court in circumstances where the company had no jurisdictional connection with the US.

The Australian Federal Court has clarified the limitations for foreign entities and their office holders in pursuing action in Australia to access the voidable transaction provisions of the Australian Corporations Act.

There are limits on the ability of shareholders to ratify dubious acts of the directors – it cannot be effective if the interests of existing creditors have become paramount (so as to subordinate the duties owed to shareholders) and are prejudiced. This is particularly relevant to upstream guarantees. On 6th February, the Court of Appeal gave its 51-page judgment in BTI 2014 LLC v Sequana S.A which is relevant to exactly this point.

Control to Serbian Creditors- the amendments to the Serbian Insolvency Act

The recent amendments to the Serbian Insolvency Act enacted 9 December 2018 have placed more control into creditors’ hands allowing them to suggest the insolvency administrator to be appointed, as well as providing less restrictive provisions on the proposers of reorganisation proposals.

In October 2018 Judge Glenn of the United States Bankruptcy Court (New York) considered the common law principles of comity and the English common law Gibbs rule to grant recognition of a Croatian company's settlement agreement which modified both New York and English law.

Background

Following our previous article, the Court of Appeal dismissed an appeal following the High Court deciding that a moratorium in relation to restructuring proceedings in Azerbaijan could not be extended in breach of the Gibbs rule, allowing two significant creditors to proceed with their claims in the English Courts.