The Court of Appeal has held that the Electronic Money Regulations 2011 do not impose a statutory trust in respect of funds received from e-money holders (who nonetheless enjoy priority status in respect of their creditor claims), providing some much-needed clarity on this issue for e-money institutions and their clients.

A link to the judgment can be found here.

Background

In the recent Court of Appeal case of Re Ipagoo LLP, the court provided welcome clarity on the status of e-money holders’ claims under the Electronic Money Regulations 2011 (EMR). In brief, the Court of Appeal held that the EMR do not impose a statutory trust in respect of funds received from e-money holders. The court confirmed, however, that e-money holders will still enjoy priority status in respect of their e-money creditor claims (crucially) whether or not their funds have been duly segregated from the general pool of assets, as required under the EMR.

Following the 54% increase in the energy price cap announced by Ofgem on 3 February, and with many predicting that a second substantial increase may be required this October to keep pace with wholesale prices, what is next for beleaguered small energy suppliers?

In what is believed to be the first reported decision on this issue, the High Court has allowed an appeal under section 205(4) of the Insolvency Act 1986 (IA 1986) against a decision of the Secretary of State to defer the dissolution of a company in liquidation.

A link to the judgement can be found here.

The facts

The Commercial Rent (Coronavirus) Bill 2021 (the Bill) is expected to come into force from 25 March 2022 – it is intended to introduce an arbitration procedure for commercial rent arrears accrued by businesses during the “protected period” and also to extend the restrictions on the use of winding up proceedings and now to include personal bankruptcy.

The “protected period” relates to business tenancies adversely affected by the pandemic either by enforced closure or restrictions placed on trade. This period – as set out in section 5 of the Bill – runs from:

In the first three months of 2021, almost 40,000 companies were struck off the Companies House register – an increase of 743% on the same period in 2020. Speculation that these figures related to avoidance of coronavirus-related loan repayments led the Department for Business, Energy and Industrial Strategy to take the highly unusual step, in March 2021, of making a blanket objection to any application for dissolution by a company with an unpaid bounce-back loan.

As the UK emerges from the COVID-19 pandemic, the domestic construction industry can look forward to a bright but challenging future. Mortgages are at record lows; housing demand remains high and the wider economy is in optimistic mood. However, businesses are experiencing challenges associated with sourcing raw materials, staff shortages and the prospect that more companies will likely fail as government business support measures tail off.

A bill currently making its way through parliament is intended to enable increased scrutiny of the actions of directors of dissolved companies – and discourage the abuse of the voluntary strike-off procedure as an ‘alternative’ to insolvency proceedings. The measures relating to dissolved companies in the Rating (Coronavirus) and Directors Disqualification (Dissolved Companies) Bill (the “Bill”) have been contemplated for some time, originally raised in the government’s consultation on insolvency and corporate governance in 2018 (the “2018 Consultation”).

The High Court has set out the principles that apply to the construction of questions in an insurer’s automated online underwriting system and the circumstances in which an insurer’s questions may lead to waiver of the right to be told about certain information. In this case, the Court considered the construction and scope of the insurer’s standard question concerning previous insolvencies, and held that the wording used waived the insurer’s right to be told about other insolvency events not caught by the question.

Background

Insolvency proceedings are typically launched by an administrator or liquidator during an insolvency process. The nature of modern insolvency litigation, including the market for assigning causes of action to third parties, has somewhat muddied the waters on how and where to commence proceedings. Two recent cases provide some valuable insight into the High Court’s approach.