The Supreme Court has handed down its highly anticipated judgment in the joint Nortel Networks/Lehman Brothers appeal.  The administrators of Nortel and Lehman Brothers entities had appealed against the Court of Appeal’s decision that Financial Support Directions (FSDs) issued by the Pensions Regulator (“the Regulator”) after the appointment of administrators attracted priority status as an administration expense.  Rejecting the decision of the lower courts, the Supreme Court ruled that an FSD issued during the course of an administration will rank as a provable debt rather than a

The guidelines laid down by the English courts for applying the balance sheet test for insolvency affects not only whether a company is technically insolvent, but also the enforceability of clauses in transactional banking documents and the ability of a liquidator to challenge certain antecedent transactions. The Supreme Court’s decision will therefore be welcomed by advisors, bankers and insolvency practitioners as it has overturned the high threshold laid down by the Court of Appeal.

CMS has succeeded in its application on behalf of HSBC to overturn the High Court’s decision inRe Tambrook Jersey Limited. The ruling will be welcomed by creditors and practitioners alike as the Court of Appeal has confirmed the UK courts have jurisdiction to grant assistance to a foreign court under the cross-border assistance provisions of section 426 of the Insolvency Act 1986 even where formal insolvency proceedings have not been opened in the foreign jurisdiction.

CMS is advising HSBC on its expedited appeal of a recent controversial decision by the High Court refusing assistance under the cross-border assistance provisions of section 426 of the Insolvency Act 1986.  The decision of the Court of Appeal will be of great interest to those involved in cross-border insolvency and restructuring as well as foreign courts.