Introduction

The recent decision of Andrew Burrows QC, sitting as a Judge of the High Court, in Palliser Limited v Fate Limited (In Liquidation) [2019] EWHC 43 (QB), is a useful reminder of the difficulties that can arise where one party (here a tenant) relies on another (its landlord) to take out insurance.

The Facts

In 2010, a fire started at the ground floor restaurant owned and operated by a company called Fate Limited (“Fate”). It was not in dispute that the fire was caused by Fate’s negligence.

Re SHB Realisation Ltd (formerly BHS Ltd); Wright and another (as joint liquidators of SHB Realisations Ltd (formerly BHS Ltd)) v Prudential Assurance Companies Ltd [2018] EWHC 402 (Ch); [2018] All ER (D) 58 (Mar)

Synopsis

Daniel Gatty discusses the recent High Court ruling in Leon v Her Majesty’s Attorney General and others [2018] EWHC 3026 (Ch) and its impact on the grant of vesting orders following the disclaimer of a lease.

Readers of this column will be aware of the complications that can ensue when a lease is disclaimed by a tenant’s liquidator under section 178 of the Insolvency Act 1986 (IA 1986), by a tenant’s trustee in bankruptcy under section 315 of the IA 1986 or by the Crown under section 1013 of the Companies Act 2006 (CA 2006) following dissolution of a tenant company.

This is the third occasion on which I have posted on this blog on the issue of after the event insurance (ATE) policies and the impact which they have on applications for security for costs.

In the first post on 16 November 2017, I praised the judgment of Snowden J in Premier Motorauctions v Pricewaterhouse Coopers for appearing to bring clarity to an area which had for some time struggled with near irreconcilable decisions.

Two years ago, after a slew of bankruptcies in the energy sector triggered by a dramatic drop in commodity prices during the worst downturn for U.S. energy producers since the 1980’s, the Office of the Comptroller of the Currency (OCC) issued new guidance that proposed changes to underwriting analysis and loan risk rating determinations by national banks and federal savings associations of loans secured by oil and gas reserves (RBLs).

1 Driven by a concern that banks were not appropriately capturing risks associated with increased

Can an adjudicator have jurisdiction over claims for sums owed to a referring party in liquidation? The TCC has decided in Lonsdale v Bresco that insolvency set-off precludes adjudication of such claims.

Background

Bresco had agreed to perform electrical installation works for Lonsdale in August 2014. Those works were not completed and both parties alleged wrongful termination. Bresco later became insolvent and entered into liquidation in March 2015.

The revised Practice Direction: Insolvency Proceedings

July 2018

The United States Court of Appeals for the Second Circuit affirmed U.S. District Judge Jed S. Rakoff’s decision that the gas gathering contracts that Sabine Oil & Gas Corporation entered into with two midstream service companies were personal obligations, and not “covenants running with the land” under Texas law, which, therefore, could be rejected under Section 365 of the Bankruptcy Code.

Executive Summary

Companies in the health care industry face many unique challenges when undergoing a bankruptcy, including challenges arising due to the federal and state law framework governing the use and disclosure of medical information. In February 2018, the U.S. Department of Health and Human Services announced that it had reached a settlement with the receiver appointed to liquidate the assets of Filefax Inc., a medical record storage and transportation company, resolving claims against Filefax for potential violations of the Health Insurance Portability and Accountability Act, or HIPAA.