What can we say about the outcome of the GAS (Great Annual Savings Company Limited) sanction hearing that hasn’t already been reported?

It’s impossible not to comment on the fact that the plan was not sanctioned, and as a consequence of fierce opposition from HMRC that it avoided cram down. Nor that the court refused to sanction the plan on the basis that the conditions for cram down were not met – the court was not satisfied that HMRC would be better off under the plan and even if it were the judge said he would have not exercised his discretion to cram down.

The recent case of Dolfin Asset Services Ltd v Stephens & Anor (Re Dolfin Financal (UK) Ltd) [2023] EWHC 123 (Ch) (“Dolfin“) concerned a special administration, but it has relevance to administrators more generally. In particular, when it comes to the judge’s view of what is meant by the word “consider” – which is phrase used in the insolvency legislation when it comes to making decisions.

In a decision likely to be welcomed by both debtors and lenders, the High Court has held that a charge granted by Avanti Communications Limited (“Avanti”) was properly characterised as a fixed charge (rather than a floating charge) notwithstanding that the chargor retained an element of control over the charged assets. A key plank of the decision was that the relevant assets were not ‘fluctuating assets’ or ‘stock in trade’ that the chargor might be expected to dispose of in the ordinary course of its business.

There are a number of options and avenues that a company can explore when faced with business stress or distress. Depending on the circumstances, a combination of these could be appropriate to help mitigate or avoid a business failing.

This guide provides an overview of potential options and should be considered alongside specific advice from the company's advisors.

Informal Options

Even when informal options are being considered, directors should engage with their advisors and stakeholders to ensure that their decisions take into account their directors' duties.

Yesterday saw the end of a three-day sanction hearing for the restructuring plan (the “Plan”) of the Great Annual Savings (GAS) company, with Justice Adam Johnson reserving his judgment and importantly, his decision on whether to exercise cross-class-cram-down to sanction the Plan for a later date.

On April 19, 2023 the Supreme Court issued its unanimous ruling in MOAC Mall Holdings LLC v. Transform Holdco LLC, 528 U.S ____ (2023), holding that the limitations contained in section 363(m) of the United States Bankruptcy Code are not jurisdictional. The Supreme Court’s ruling not only resolved a split amongst the circuits, but it also cleared up a foggy corner of arguably one of the most consequential sections of the Bankruptcy Code.

‘If, at first, you don’t succeed, then try and try again’ is a fitting description for HMRC’s recent approach to restructuring plans, with its opposition of plans proposed by The Great Annual Savings Company (GAS) and Nasmyth Group Limited (Naysmyth).

The GAS sanction hearing (which is due to take place this week) will be the first time that HMRC has taken an active role contesting a restructuring plan at sanction following the case of Houst where the Court exercised its discretionary power to “cram down” HMRC.

The Insolvency Practice Schedule (Corporations) (Practice Schedule) was introduced in 2015 via the Insolvency Law Reform Bill 2015. The Practice Schedule was introduced together with the Insolvency Practice Schedule (Bankruptcy) with the intention of providing specific rules to aid in the handling of personal bankruptcies and corporate external administration. 

In a previous blog about the case of Mizen we considered the case from the point of view of “guarantee stripping”, looking at how the CVA dealt with those claims. However, the CVA was challenged on a number of bases, including whether it was unfairly prejudicial as a consequence of “vote swamping”.

In this blog, we look at that aspect of the case.

簡介

香港法院在香港將外國註冊公司清盤的法定司法管轄權，受到法院自設的限制所規限；該等限制被稱為法院行使上述司法管轄權之前所須符合的三大核心要求。

最近在Re Guoan International Ltd[2023] HKCU 939一案中，原訟法庭（「原訟庭」）需考慮是否將一間已被其註冊地點的法院清盤的外國註冊公司清盤。

案情

國安國際有限公司（「該公司」）的債權人Road Shine Developments Limited（「呈請人」）於2022年12月2日向香港法庭提出呈請，請求發出將該公司清盤的附屬命令。該公司於開曼群島註冊成立，於2022年2月28日被開曼群島大法院清盤，而袁子俊先生及Martin Trott先生於同日獲委任為其清盤人（「共同清盤人」）。反對呈請的債權人Chong Chin先生及Yao Sze Ling女士（統稱「反對債權人 」）基於兩個主要理由反對呈請：