Following our 2016 article, the Court of Appeal has upheld the decision of the High Court that dividends are liable to challenge as transactions defrauding creditors under section 423 of the Insolvency Act 1986 (the “IA”).

Are you already a board member or executive of a Slovak company or about to become one? If so, you should know about the proposed amendment to the Slovak Commercial Code. The amendment aims to address the so-called “white horses” and “tunneling (asset stripping)” of the companies.

In the recent case of BTI 2014 LLC v Sequana SA & others [2016] EWHC 1686, the High Court has held for the first time that a dividend can be challenged as a transaction entered into at an undervalue within the meaning of section 423(1) of the Insolvency Act 1986 (the “IA”).

The Facts

The facts of the case are long and complex but for present purposes the pertinent facts are as follows.

Arjo Wiggins Appleton Limited (now Windward Prospects Limited) (“AWA”) was a wholly owned subsidiary of Sequana SA (“SSA”).

The Court of Appeal has recently considered the status of contingent assets within the balance sheet test for insolvency in the context of a company’s inability to pay its debts. Under Section 123 Insolvency Act 1986, a company is deemed unable to pay its debts if its assets are less than its liabilities including contingent liabilities but nothing is said about the status of contingent assets.

Judgment of the Supreme Court, Chamber One, Number 134/2016, 04 March

Due to the introduction of new tax legislation on 6th April 2016, distributions made to shareholders of companies undergoing Members’ Voluntary Liquidation (MVL) are now treated as income (rather than capital) and are taxed accordingly.

The Texas Supreme Court, on June 20, 2014, issued its highly  anticipated opinion in Ritchie v. Rupe, 2014 Tex. LEXIS 500 (Tex.  2014). Ritchie involved a claim by a minority shareholder in a  closely held corporation under the Texas receivership statute,  seeking to force the majority shareholders to buy-out the minority  shareholder’s interest in the corporation.

On 23 February 2011, the Federal Government (Bundeskabinett) adopted the government draft (Regierungsentwurf) of an act (Entwurf eines Gesetzes zur weiteren Erleichterung der Sanierung von Unternehmen) that proposes material changes to the German Insolvency Act (Insolvenzordnung). The government's aim is to modify the economic terms for the restructuring of distressed companies .

In a decision released on March 29, 2011, CDX Liquidating Trust v. Venrock Assocs., et al., 2011 U.S. App. LEXIS 6390 (7th Cir. March 29, 2011), the United States Court of Appeals for the Seventh Circuit, reversing the district court’s ruling, held that a director’s disclosure of a conflict, in and of itself, is insufficient to protect that director from liability for breach of fiduciary duty or disloyalty arising from that conflict.

On February 7, 2011, the Court of Appeals for the Second Circuit issued a highly significant opinion in two consolidated appeals from the order of the United States District Court for the Southern District of New York affirming the bankruptcy court’s confirmation of a chapter 11 plan of reorganization for DBSD North America and its subsidiaries (DBSD).