The Court of Appeal overturns the High Court decision concerning an ATE insurance policy lacking anti-avoidance provisions as adequate security for costs.

In the aftermath of recent municipal bankruptcies in which issuers proposed and/or implemented bankruptcy plans involving partial discharges of the issuer’s payment obligation on insured bonds, there has been increased focus on whether municipal bond interest paid by a bond insurer after the bankruptcy plan’s effective date continues to be tax-exempt.