Summary

This briefing looks at the “period of grace” provisions that can apply in some cases to the debts that arise on employers under section 75 of the Pensions Act 1995.
In a multi-employer scheme, if one employer ceases to employ any active members, a s75 debt can arise on that employer. The period of grace provisions allow the employer to serve a notice so that the debt is suspended, giving the employer a period (at least a year, but potentially up to three years if the trustees agree) in which to employ an active member.

The United States Court of Appeals for the Second Circuit recently articulated a standard to determine what claims may be barred against a purchaser of assets "free and clear" of claims pursuant to section 363(f) of the Bankruptcy Code and highlighted procedural due process concerns with respect to enforcement.¹  The decision arose out of litigation regarding certain defects, including the well-known "ignition switch defect," affecting certain GM vehicles.  GM's successor (which acquired GM's assets in a section 363 sale in 2009) asserted that a "free and clear" provisi

Summary

Pension scheme trustees will generally be concerned to try to ensure that the “safety net” provided by the Pension Protection Fund (PPF) remains potentially available for their scheme.

On March 29, 2016, the Second Circuit addressed the breadth and application of the Bankruptcy Code's safe harbor provisions in an opinion that applied to two cases before it.  The court analyzed whether: (i) the Bankruptcy Code's safe harbor provisions preempt individual creditors' state law fraudulent conveyance claims; and (ii) the automatic stay bars creditors from asserting such claims while the trustee is actively pursuing similar claims under the Bankruptcy Code.  In In re Tribune Co.