The current COVID-19 pandemic is causing an unprecedented negative impact on businesses around the globe in nearly every sector of the economy. Both the US Government as well as Foreign Governments have and will continue to provide short- and long-term financial support to these businesses. However, this financial assistance will not be available to every business, nor will it be adequate in all instances to offset decreased revenue resulting directly and indirectly from the pandemic.

As businesses seek to adapt to deal with the financial impact of COVID-19, boards of directors have been faced with the difficult decision of having to file for insolvency or take steps to preserve business continuity and live to fight another day. Understandably directors' duties is a topic that has come keenly into focus with directors wishing to ensure that, whatever steps they take, they do not incur personal liability.

On March 25, 2020, the Senate passed an amendment to H.R. 748, the Coronavirus Aid, Relief, and Economic Security Act (as amended, the “CARES Act”), which (as of March 26, 2020) is being considered in the House.

The complete text of the current draft of the CARES Act can be found here.

“Only when the tide goes out do you discover who’s been swimming naked” – Warren Buffet

The tide has gone out on the municipal finance market.

While much of the discussion about the financial fall-out of the COVID-19 virus has focused on the massive wealth destruction in stock markets and pressure on corporates around the world, the impact on the largest financial market in the world- the $3 trillion US municipal finance market- cannot be ignored. Simply put, the market is imploding.

It's been yet another busy year for construction, with BIM developments, greater use of modern methods of construction, looming Brexit, increased insolvencies, building safety progress, a brighter spotlight on diversity...    In this article, we take a look at some of the key legal changes and industry developments for the construction industry, and highlight a few things to expect in 2020.

Legal Changes 

Fewer disputes

Philip Stephen Wallace (as liquidator of Carna Meats (UK) Limited) –and- George Wallace [2019] EWHC 2503 (Ch)

The High Court has recently revisited the question of whether section 236 of the Insolvency Act 1986 has extraterritorial effect and considered the differing views expressed in previous cases.

As reported in Building earlier this year (4 February) the construction industry experienced the highest number of insolvencies of any UK industry in 2018. Last year saw 2,954 firms become insolvent, an increase of 12% on the previous year and more than in any year since 2013. It is well known that the construction industry is particularly prone to insolvencies and there has been a great deal written about why that is the case and what can be done about it.

According to the recent case of Sell Your Car With Us Ltd v Sareen [2019] – yes, they are.

Historically the courts have looked dimly on the use of insolvency proceedings as a method of debt collection. For this reason, where an individual or company appears to have the means to pay a debt but apparently refuses to do so, the courts have implied that the only proper legal recourse is through litigation. In this case, the judge explained why she considers this submission to have been taken too far.

Background

In the past five years, insolvency rates in the construction industry have increased more quickly than in other industries across the UK. This article considers the common causes of construction insolvency and how to protect your position if insolvency occurs.

Recent trends

The United States Court of Appeals for the Seventh Circuit held that payments made by a debtor’s customers to its lender converting a pre-petition loan to a post-petition loan constituted disbursements for the purposes of calculating the statutory fees payable pursuant to 28 U.S.C. 1930(a)(6). In re Cranberry Growers Coop., 2019 U.S. App. LEXIS 21121 (7th Cir. July 17, 2019). This decision, coupled with the increase in the quarterly fees for the U.S.