In a recent ruling (NMC Health PLC (in Administration) v Ernst & Young LLP [2024] EWHC 2905 (Comm)), the High Court declined to order disclosure of witness statements and transcripts of interviews conducted by administrators during their initial investigations, citing litigation privilege.

Litigation privilege

In March 2015 the major high street retailer British Home Stores (BHS) was acquired for £1 by Retail Acquisitions Limited (RAL), a company owned by Mr Dominic Chappell. Mr Chappell became a director of the BHS entities upon completion of the purchase, together with three other individuals.

What happens to a company at the end of an administration is a question that probably only keeps insolvency anoraks up at night.

There are a limited number of potential options, with the rescue of the company as a going concern being the number one objective to which all administrators aspire. However, more often than not, an administration will end with the company entering liquidation or, where the company has no property to permit a distribution to creditors, the dissolution of the company.

While franchising has typically been a more robust business model than others, it remains susceptible to broader economic and sectoral pressures, as The Body Shop’s recent entry into administration demonstrates.

In the unfortunate event that a franchisor or franchisee becomes insolvent, disruption is inevitable. However, insolvency doesn’t necessarily spell a terminal outcome. In this article we consider some of the key considerations for both franchisors and franchisees.

Handling franchisee insolvency: the franchisor’s approach

The High Court has handed down an important decision confirming that an unrecognised foreign judgment can be used to form the basis of a bankruptcy petition.

In rejecting the bankrupt’s appeal, the court confirmed that a debt arising pursuant to such a judgment is capable of constituting a “debt” for the purposes of section 267 Insolvency Act 1986 (the Act), despite the fact that the underlying judgment had not been the subject of recognition proceedings in England.

Facts

We find ourselves in a year of transition, with (whisper it) the economy stabilising and an election tipped for the second half of 2024. Surely only a fool, in times such as these, would seek to anticipate what change could unfold in the legal landscape over the next 12 months. Challenge accepted! For 2024 we have dusted off our crystal ball and we set out below our (educated) guesses of what to expect for the year (or two) ahead…

Implementation of UNCITRAL model law on Enterprise Group Insolvency

一、“集中管辖”概述

《中华人民共和国民事诉讼法》（下称“《民事诉讼法》”）中，对于“集中管辖”并无明确的规定，而在民事诉讼的司法实践中，存在许多被称为“集中管辖”的做法。实务中，“集中管辖”泛指将某类案件，依照《民事诉讼法》及其他法律法规的相关规定，以司法解释或者通知的形式，集中由某类法院或某个法院管辖的情形。

概括来说，“集中管辖”共分为如下三种情形：

（1）某类法院集中管辖某类案件，如依据《中华人民共和国企业破产法》（下称“《企业破产法》”）第二十一条的规定，破产案件中涉债务人的诉讼案件集中由受理破产申请的人民法院管辖，或者依据《全国法院审理债券纠纷案件座谈会纪要》（以下简称“《债券会议纪要》”）第十条的规定，以发行人或者增信机构为被告提起的要求依约偿付债券本息或者履行增信义务的合同纠纷案件，由发行人住所地人民法院管辖；

（2）某个法院集中管辖某一类型化案件，如各地金融法院集中管辖当地金融案件、各地知识产权法院集中管辖当地知识产权案件；

Summary

In this High Court case ICC Judge Barber ordered a disqualified director to compensate creditors for losses under s15A of the Company Directors' Disqualification Act 1986 (CDDA) as a result of negligent conduct in trading a company illegally.

Facts

As can often be the way, August was a disappointing month for many, with the dull and dreary weather casting a shadow over plans made for the school holidays. So too, it seems, was August a bad month for the business community – perhaps in some cases linked to the weather, with poorer performance by seasonal businesses reliant on fair weather custom.

The curiosity with claims based on transactions defrauding creditors is that a transaction can fall within its scope when a debtor is solvent and may never ultimately enter an insolvency process, and there is no requirement of fraud. Such claims fall under section 423 of the Insolvency Act 1986 (the act), and do require a debtor to have entered into a transaction at an undervalue (drawing on claims under section 238 and 339 of the act, in corporate and personal insolvency respectively) with the intention of putting assets beyond the reach of creditors.