BANKING

ECON votes to adopt draft report on proposed BRRD Insolvency Hierarchy Directive

The Technology and Construction Court in England has refused pre-action disclosure of the insurance policy of a currently solvent insured, notwithstanding that a successful claim would have resulted in the insolvency of the insured.

Factual background

Background

This was an appeal by Dr Mohammed Abdulla (the “Appellant”), the husband of Mrs Sarah Amin (the “Bankrupt”), against the decision at first instance in favour of (1) Mr Andrew John Whelan (2) Mr Walter Terence Weir (3) Mr David Ansell and (4) the Bankrupt (together the “Respondents”). The pertinent facts are:

• Mr Whelan was the trustee in bankruptcy for Mrs Amin (the “Trustee”).

The Insolvency (England and Wales) Rules 2016 come into effect in November 2016; we wrote how the Insolvency (England and Wales) Rules 2016 (the “2016 Rules”) were laid before Parliament on 25 October 2016 (http://tinyurl.com/kcy2723).

Background

Establishing a debtor company’s Centre of Main Interests (“COMI”) is an important step for any creditor who wishes to begin insolvency proceedings within the UK. In the context of real estate finance, it is common for the different borrower-side parties to be incorporated in various jurisdictions and, in particular, for the borrower/propco to be a special purpose vehicle incorporated and registered outside the UK.

It is standard market terms for a lender to have the express right to transfer its loan. In particular, English law governed syndicated loan documents will usually incorporate the Loan Market Association (LMA) wording (or similar) to this effect. Interestingly, the Court of Appeal has recently had to consider the scope for implying terms into such LMA-style language and whether to restrict a lender’s right to market the sale of the loan under those standard terms.

The potential cost of making or defending a claim is often a concern for anyone involved in litigation or arbitration. AG has since 2008 been at the forefront of sharing the risk with its clients, and the litigation funding market has responded with a variety of different options and opportunities. And it's also a developing topic for the courts. Our Control Update newsletter reports all the latest developments, both commercial and legal.

Litigation funders – extent of their involvement and liability for costs

If you would prefer not to receive this service from Addleshaw Goddard, please email: [email protected] TRUSTEE QUARTERLY UPDATE Pensions 1 December 2016 Court holds Bankrupt cannot be forced to draw scheme benefits to pay creditors In its judgment in Horton v Henry the Court of Appeal has held that where a bankrupt member has a right to draw benefits, but has not yet chosen to do so (a) his rights to future benefits under the scheme are not "

The Claim

Arjo Wiggins Appleton Limited (“AWA Limited”) was a wholly owned subsidiary of Sequana SA (the “Defendant”). BAT Industries Plc (“BAT Plc”), through a series of corporate acquisitions, became liable to pay for part of an environmental clean-up operation in the USA. AWA Limited was also liable to indemnify BAT Plc for part of that liability.

In December 2008, AWA Limited’s directors signed a solvency statement confirming that, in the opinion of the directors;