December 2023
The Right of Set-off in Insolvency Proceedings
MAYER BROWN | THE RIGHT OF SET-OFF IN INSOLVENCY PROCEEDINGS
Welcome to our monthly newsletter, with a summary of the latest news and developments in UK employment law.
In this issue
- Case law updates
- Legislative developments
- Other news
- New guidance
- Consultations
Recent publications
The pilot measure for mutual recognition and assistance of insolvency proceedings between the courts of three pilot areas in Mainland China and Hong Kong was agreed in mid-2021, which is known as the Cooperation Mechanism.
Since then, liquidators in Hong Kong have had a more certain and structured route to seek, through Hong Kong Court, recognition and assistance from the designated Mainland courts in the three pilot areas including Shanghai, Shenzhen and Xiamen.
Key Takeaways
When an employer is insolvent and administrators appointed, job losses are often an inevitable consequence. In this blog we look at the legal obligations arising where redundancies meet the threshold for collective consultation, and the implications for administrators arising out of the recent Supreme Court in the case of R (on the application of Palmer) v Northern Derbyshire Magistrates Court and another.
When does the legal obligation to collectively consult apply?
Key takeaways
Over the past several years, unitranche facilities have become increasingly prevalent. This growth has been driven by the ever-growing class of private credit and direct lenders who initially developed the unitranche facility structure, along with traditional bank lenders now joining this market. The unitranche structure has several advantages, including typically quicker execution for the parties involved and in some cases a lower cost of capital to the borrower.
As discussed in our post last month, it was a long road for Arrowood Indemnity to be placed into liquidation in Delaware.
On November 6, 2023, WeWork Inc. and several hundred of its affiliates filed voluntary chapter 11 cases in the US Bankruptcy Court for the District of New Jersey. According to a press release issued simultaneously with the filings, WeWork also intends to file recognition proceedings in Canada under Part IV of the Companies’ Creditors Arrangement Act. The press release also states that WeWork’s locations outside of the United States and Canada are not part of the reorganization process.
Key takeaways
INTRODUCTION Within German contract law, the principle of being bound by a contract (pacta sunt servanda) (i.e., the obligation to fulfill an agreement) applies. However, in the case of the insolvency of one of the contract parties, exceptions are made. Upon the opening of insolvency proceedings, the principle of being bound by a contract is modified. The insolvency provisions concerning the fulfillment of mutual contracts (Section 103 et seqq.