A mortgage bank has the power to foreclose and sell the collateral if the debtor is in default. However, this power does not apply in full. There is a risk of abuse of power in this respect. The circumstances, motives and actions of the parties play a major role in this. In this situation, the interests of the mortgage bank and the debtor are diametrically opposed. The mortgage bank has an interest in claiming the outstanding claim and the debtor has an interest in maintaining his immovable property.

As from 1 May 2018, a comprehensive reform of the Belgian insolvency framework entered into force. The old framework consisted of two separate laws governing respectively bankruptcy and judicial reorganization. The new legal framework incorporates both regimes in Book XX of the Belgian Code of Economic Law.

Innovations

Briefings

Navigating the tension between private dispute resolution and insolvency class actions, March 2018

In Lasmos Limited v. Southwest Pacific Bauxite (HK) Limited1, the Hong Kong Court of First Instance dismissed a winding-up petition based on an unsatisfied statutory demand.

Briefings

A recent ruling by the English High Court in BILTA v RBS1, concerning EU Emissions Allowances (“EUAs” or “carbon-credits”) trading has re-opened the debate on when materials forming part of an internal investigation can benefit from litigation privilege. The decision further undermines the restrictive approach taken by Andrews J in SFO v ENRC2 when applying the “sole or dominant purpose test” to dual-purpose communications.

Background – Emissions Trading Fraud

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Bogra is a company that is active within the funeral industry. As a result of serious financial problems, an administrator (bewindvoerder) was appointed on 28 June 2017. On the same date Bogra was declared bankrupt (30 June 2017), the employment agreements of Bogra’s employees were terminated. Funico acquired (part of) Bogra’s assets on 18 July 2017 due to an asset transaction. Effective 19 July 2017, Bogra’s activities were continued by Bogra Uitvaartkisten.

The professional indemnity insurer of an insolvent independent financial adviser (Target) successfully relied on an insolvency exclusion in the policy to deny liability to third party (former) clients of Target1.

In 2005 Target had advised Mr. and Mrs. Crowden to invest £200,000 in a “Secure Income Bond” issued by SLS Capital SA in Luxembourg and Keydata Investment Ltd.2 SLS went into liquidation in 2009.

Crusade against dormant companies: make sure you file your annual accounts on time!

Introduction

On 5 September 2017, the Dutch legislator published an amended bill on pre-insolvency proceedings in the Netherlands1 for consultation purposes.2 The Bill contains a proposal for an amendment to the Dutch Bankruptcy Act (Faillissementswet) which enables a company in financial difficulties to propose a composition outside insolvency proceedings to its creditors and shareholders, to restructure problematic debts.

The High Court has considered a recent Court of Appeal ruling on whether trustees in bankruptcy should be able to deploy privileged documents in the discharge of their duties.

The existing position under Avonwick

The facts of Shlosberg v Avonwick Holdings Limited [2016] EWCA Civ 1138 involved a company called Webinvest. Webinvest was beneficially owned by Mr Shlosberg. Avonwick lent US$100 million to Webinvest, with Mr Shlosberg personally guaranteeing the loan.