Investing in or acquiring distressed assets can be a lucrative investment strategy for those with a healthy risk appetite and a roadmap for sourcing and evaluating quality assets.

Following a steep run-up in crypto asset prices and valuations of crypto-adjacent businesses in the last two years, there has been a sharp increase in companies and assets in the space looking at deeply distressed valuations, liquidity crunches or formal insolvency or bankruptcy proceedings.

City Gardens Ltd v DOK82 Ltd [2023] EWHC 1149 (Ch) was a successful appeal against the decision of the district judge below to dismiss a winding up petition on several bases: first that the court had no jurisdiction to make an order because arrangements between the parties were subject to an exclusive jurisdiction clause, secondly because they provided for the application of Hong Kong law rather than English law, thirdly by reason of disputes regarding certain other contractual terms, and finally by reason of an issue as to whether the company had a viable cross claim.

German insolvency law is governed by a comprehensive Insolvency Code that entered into force on 1 January 1999 and has since then regularly been subject to amendments from time to time. There is only one primary uniform insolvency procedure that applies to both individuals and companies. In the following, we focus on companies. Insolvency proceedings can be initiated against any natural or legal person, excluding certain legal persons organized under public law, such as the German Federation or the German states.

The judgment of Adam Johnson J in Re Great Annual Savings Company Ltd, (Re Companies Act 2006) [2023] EWHC 1141 (Ch) demonstrates again the rigorous approach the courts are taking in relation to the fulfilment of the conditions required to “cram down” dissenting creditors in restructuring plans as well as in the exercise of the court’s discretion to sanction them.

A claim under s 127 is restitutionary (see Hollicourt (Contracts) Ltd v Bank of Ireland and Ahmed v Ingram), and in a case involving the payment of money is for unjust enrichment (see Officeserve Technologies Ltd v Annabel’s (Berkeley Square) Ltd).

Re Nasmyth Group Ltd (Re Companies Act 2006) [2023] EWHC 988 (Ch) sets out Leech J’s reasons for refusing to sanction a Part 26A restructuring plan.

The company acted as the holding company of engineering subsidiaries in the UK and elsewhere and provided administrative and treasury functions to the rest of the group.

Bed Bath & Beyond, the home goods retailer, has filed bankruptcy under Chapter 11 and plans to conduct liquidation sales and close all of its brick-and-mortar stores by June 30, as reported by The New York Times. The retailer points to an inability to adjust to the growth of online shopping as a reason for its downfall.

The judgment of the Court of Appeal (Newey, Males and Snowden LLJ) in Hunt v Ubhi [2023] EWCA Civ 417 demonstrates the importance of the adequacy of any undertaking in damages given in support of an application for a freezing order and underlines the need for full and frank disclosure.

There are many cases about the appointment of administrators, not so many about terminating their appointment. Re Central Properties Holdings Ltd (In Administration) [2023] EWHC 829 (Ch) is one.

Although it’s inaccurate to say that the Chinese character for “crisis” combines the characters for danger and opportunity, the thought has resonated since President Kennedy repeatedly used this trope in his presidential campaign speeches.