Why calculating potential claims under s214 Insolvency Act 1986 can be far from simple

Introduction

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

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.

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.

Overview

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.

In the recent case of Brake & Anor v Chedington Court Estate Limited [2023] UKSC 29, the Supreme Court has clarified the categories of persons who have standing to make a challenge to the conduct of a trustee in bankruptcy under s303 of the Insolvency Act 1986 (the “Act”). The Supreme Court confirmed that its decision will also apply to creditors and others seeking to challenge the actions of a liquidator under s168(5) of the Act. The decision will be welcomed by practitioners.

Summary

Trustees in bankruptcy can often come up against challenges in dealing with obstructive bankrupts. A bankrupt might ignore communications and requests for interview, fail to disclose information about their assets, or provide partial cooperation which fails to offer any substantive assistance.

Judgment creditors should be aware that the English Court of Appeal has given guidance on the proper construction of s423 Insolvency Act 1986 (transactions defrauding creditors)¹.

Selon la Banque de France, les procédures collectives affectant les moyennes entreprises sont en hausse de 85% sur un an. Cette tendance affecte particulièrement les entreprises de la French Tech pour des start-ups qui n’ayant pas trouvé leur modèle économique, se trouvent confrontées à un mur de dettes.