There are many enforcement options available to commercial landlords in England & Wales, to recover rent arrears due under a lease from a business tenant. Some of those options are based in contract and governed by the terms of the individual lease itself, such as a power to forfeit or damages for breach, whilst some of those options are based in statute such as the Commercial Rent Arrears Recovery regime.

When an individual or company purchases property in England or Wales, the legal title will transfer once the purchaser is listed as the registered proprietor at the Land Registry. However, what happens when, pending the registration of the legal interest, the seller company (who is still the registered proprietor) is dissolved? This is a risk seldom contemplated when purchasing property, but can have important consequences for the title of the property.

This question had until recent times been a conundrum of modern fixed charge receiverships (as well as receivers appointed under the Law of Property Act 1925), because in the scenario of the receiver seeking to step in and deal with property, the receiver is also said to be the borrower's deemed agent. It therefore begged a thorny question of the receiver, about how to reconcile being on both sides of the possession action.

There are significant differences in the procedures available to lenders north and south of the border when it comes to enforcing fixed charges or standard securities over real/heritable property. In this blog, we will compare the process in England & Wales ("E&W") of appointing a fixed charge or "LPA" receiver with the Scottish calling-up procedure

England & Wales: LPA receivers

The U.S. Court of Appeals for the Sixth Circuit recently ruled in a case involving a Chapter 13 debtors’ attempt to shield contributions to a 401(k) retirement account from “projected disposable income,” therefore making such amounts inaccessible to the debtors’ creditors.^[1] For the reasons explained below, the Sixth Circuit rejected the debtors’ arguments.

Case Background

A statute must be interpreted and enforced as written, regardless, according to the U.S. Court of Appeals for the Sixth Circuit, “of whether a court likes the results of that application in a particular case.” That legal maxim guided the Sixth Circuit’s reasoning in a recent decision^[1] in a case involving a Chapter 13 debtor’s repeated filings and requests for dismissal of his bankruptcy cases in order to avoid foreclosure of his home.

On January 14, 2021, the U.S. Supreme Court decided City of Chicago, Illinois v. Fulton (Case No. 19-357, Jan. 14, 2021), a case which examined whether merely retaining estate property after a bankruptcy filing violates the automatic stay provided for by §362(a) of the Bankruptcy Code. The Court overruled the bankruptcy court and U.S. Court of Appeals for the Seventh Circuit in deciding that mere retention of property does not violate the automatic stay.

Case Background

When an individual files a Chapter 7 bankruptcy case, the debtor’s non-exempt assets become property of the estate that is used to pay creditors. “Property of the estate” is a defined term under the Bankruptcy Code, so a disputed question in many cases is: What assets are, in fact, available to creditors?

Challenging a Tenant CVA

Company Voluntary Agreements ("CVAs") have been the go-to option for struggling retail businesses over the pandemic period. While all creditors are generally treated equally under a CVA, landlords are increasingly finding themselves at the short end where they are the only, or one of, a very small pool of, creditors taking a hit. It is now more important than ever that a landlord knows the circumstances by which they can challenge a tenant's CVA.

Once a Chapter 7 debtor receives a discharge of personal debts, creditors are enjoined from taking action to collect, recover, or offset such debts. However, unlike personal debts, liens held by secured creditors “ride through” bankruptcy. The underlying debt secured by the lien may be extinguished, but as long as the lien is valid it survives the bankruptcy.