Key point
A Court always has discretion whether to set aside a statutory demand based upon cross claims.
The facts
A debtor applied to Court to have a statutory demand set aside on the basis that he had a counter claim which, if set against the debt, would leave less than £750 outstanding.
The decision
On May 21, 2015, the United States Court of Appeals for the Third Circuit affirmed a decision of the United States Bankruptcy Court for the District of Delaware, which had approved the structured dismissal of the Chapter 11 cases of Jevic Holding Corp., et al. The Court of Appeals first held that structured dismissals are not prohibited by the Bankruptcy Code, and then upheld the structured dismissal in the Jevic case, despite the fact that the settlement embodied in the structured dismissal order deviated from the Bankruptcy Code’s priority scheme.
In a memorandum decision dated May 4, 2015, Judge Vincent L. Briccetti of the United States District Court for the Southern District of New York affirmed the September 2014 decision of Judge Robert D. Drain of the United States Bankruptcy Court for the Southern District of New York, confirming the joint plans of reorganization (the “Plan”) in the Chapter 11 cases of MPM Silicones LLC and its affiliates (“Momentive”). Appeals were taken on three separate parts of Judge Drain’s confirmation decision, each of which ultimately was affirmed by the district court:
Key Point
A distressed debt purchaser may be able to rely on misrepresentations made by the borrower to the original lender in published documents to recover loss.
The Facts
An Irish investment company ("Taberna") claimed damages for misrepresentations made by or on behalf of a large Danish bank ("Roskilde"), in investor presentation documents and annual results, which induced Taberna to enter into a secondary market purchase of subordinated notes originally issued by Roskilde.
The Decision
Key Point
Her Majesty's Revenue & Customs ("HMRC") were not immune from the requirement to give an undertaking for damages suffered where a provisional liquidator was appointed based on HMRC allegations of fraud and tax evasion.
The Facts
Key Point
The Court has given guidance on when a company in administration has possession of third party assets allowing an administrator to apply for an order allowing him to sell them.
The Facts
The administrators of a company applied to Court under paragraphs 72 and 68 of Schedule B1 to the Insolvency Act 1986 for permission to sell assets located on its freehold premises pursuant to a chattel hire contract with a group company (the "Assets").
The Decision
Key Issue
A former liquidator would not be entitled to relief from liability under section 212 of the Insolvency Act 1986 where her conduct had fallen well short of the standard to be expected and she had paid away substantial sums which would otherwise be available to creditors.
The Facts
Dealing a major blow to the trustee’s efforts to recover fraudulent transfers on behalf of the bankruptcy estate of the company run by Bernard Madoff, Judge Jed S. Rakoff of the United States District Court for the Southern District of New York held in SIPC v. Bernard L. Madoff Investment Securities LLC1 that the Bankruptcy Code cannot be used to recover fraudulent transfers of funds that occur entirely outside the United States.
Key point
Under English law it is now clear that, in order to trace monies through bank accounts, it is not necessary that payments should occur in any specific order.
The facts