Once I have a contract it is binding unless the other side goes bust – right?

One party to a contract cannot unilaterally change the deal – right?

If a commercial tenant does not pay its rent the landlord can forfeit – right?

As landlords have found to their cost this year, the answer is that a CVA can challenge all of these assumptions.

A misfeasance claim under section 212 of the Insolvency Act 1986 (IA) is often a race against time to gather evidence and bring a claim before the limitation period expires. Not only can the breach pre-date the liquidation by years, but the difficulty is even greater where there is a maze of group companies and intra-group transfers. It takes time to properly work out whether a simple transfer of assets between group companies is actually a corporate shield hiding misappropriated assets.

House of Fraser (HOF) has been in the headlines for months. It started with reports of widening losses and being dragged down by soaring costs and a drop in consumer sales, but official comment from the 169-year old retailer remained positive. Then there were rumours of CVAs and negotiations with landlords leading to further controversy. Finally, last Friday (10 August 2018), a stock market announcement delivered the news that Mike Ashley’s Sports Direct had brought House of Fraser out of administration for £90 million, just hours after the store had announced its collapse.

As if business leaders did not have enough to contend with in the current economic and geopolitical climate, the trend towards increased personal accountability for company directors is continuing and can be expected to increase further. How can directors protect themselves? As a start it is important for both executive and non-executive directors to understand the overarching principles involved and how they link together.

The basic duties set out in the Companies Act 2006

As the nights drew in, the end of 2017 saw a flurry of case law on security for costs, and particularly its interaction with after the event (ATE) insurance and litigation funding. This article considers what insights can be gleaned for litigants who do not want to be left out in the cold.

Premier Motorauctions: security for costs and ATE

The raft of European and domestic litigation surrounding Mastercard fees has been long running and frankly, brain achingly complex. Hidden in the masses of litigation, the topic has sparked little interest in insolvency practitioners. However, it has the potential to generate realisations in liquidated estates where there may otherwise be nothing to offer creditors, and it warrants attention as a result.

Attachment of earnings - money is paid directly from the judgment debtor’s wages/salary into court by the debtor’s employer to satisfy the judgment debt.

Bankruptcy proceedings - you can currently apply to make an individual judgment debtor bankrupt for a judgment debt in excess of £5,000. The limit is £500 for applying to put a company into liquidation. The nuclear options.

On October 20, 2017, in In re MPM Silicones, LLC ("Momentive"), Nos. 15-1682, 15-1771, 15-1824, the Second Circuit Court of Appeals, considering the Supreme Court's opinion in Till v. SCS Credit Corp., 541 U.S. 465 (2004), adopted the Sixth Circuit's two-step approach to determining an appropriate cramdown interest rate that, in certain circumstances, results in the application of a market rate of interest. In doing so, the Second Circuit reversed the bankruptcy and district court holdings on the cramdown interest rate issue.

On June 22, Sears Canada Inc. ("Sears Canada") and certain affiliates1 (collectively, the "Sears Canada Group") sought and obtained insolvency protection under the Companies' Creditors Arrangement Act (CCAA) from the Ontario Superior Court of Justice (Commercial List) (the "Court"), which in turn appointed FTI Consulting Canada Inc. (FTI or the "Monitor") as monitor.

For many litigants, the decision whether to prosecute or defend a lawsuit vigorously boils down to a rather basic calculus: What are my chances of success? What is the potential recovery or loss? Is this a "bet the company" litigation? And, how much will I have to pay the lawyers? In many respects, it is not all that different from a poker player eyeing his chip stack and deciding whether the pot odds and implied odds warrant the call of a big bet.