Most Landlords, and Insolvency Practitioners (“IP”s), will be well aware of the issues and liabilities that can arise where a tenant (whether it be a company or individual, residential or commercial) experiences financial difficulties. Competing interests can lead to difficulties for all parties and, potentially, legal disputes.

The First Circuit Court of Appeals in In re SW Boston Hotel Venture, LLC, 2014 U.S. App. LEXIS 6768 (1st Cir. Apr. 11, 2014) recently ruled on a number of issues critical to valuing a secured claim in bankruptcy. Specifically, the court 1) endorsed the use of a “flexible approach” to value collateral under the circumstances of this case, 2) recognized that the date collateral should be valued is the lender’s burden to prove, and 3) confirmed that the pre-petition agreement’s default interest rate should generally be used to determine the post-petition interest rate.

Since the Welfare Reform and Pensions Act 1999 (“1999 Act”), it has been understood that the rights of a bankrupt under a tax approved pension plan are excluded from the bankruptcy estate and do not vest in his Trustee in Bankruptcy.

That said, where a Bankrupt was already drawing an income from his pension, his Trustee could seek an Income Payments Order over that income.

The Insolvency Rules 1986 (“IR 1986”) are to be replaced in their entirety by the Insolvency Rules 2015 (“IR 2015”).

The Insolvency Service has been running a long-standing ‘modernisation’ project to consolidate the 23 amending instruments to IR 1986 and provide a number of substantive amendments to existing insolvency law and practice. 

Debtors must provide known creditors with actual notice of a claims bar date if they want the bar date to apply to those creditors. Such was the holding in In re Majorca Isles Master Association, Inc., Case No. 12-19056-AJC, Dkt. No. 222 (Bankr. S.D. Fla. March 27, 2014), where the bankruptcy court stated that when both a debtor and a creditor are “guilty in the handling of a claim and the [d]ebtor is aware of the creditor’s claim, then a tie goes to the creditor[,]” and the creditor’s claim will be allowed.

Last Tuesday, Puerto Rico sold its much-ballyhooed $3.5 billion in non-investment grade general obligation bonds. Two days later, two legislators in Puerto Rico’s Senate filed a bill which, if enacted, would permit insolvency filings by Puerto Rico’s public corporations in Puerto Rico’s territorial trial court. The juxtaposition of the two events has some bond investors crying foul.

The Court of Appeal has handed down an important judgment for landlords and insolvency practitioners, in the case of Jervis v Pillar Denton; re Games Station (“Game”).

In a recent decision by the United States Bankruptcy Court for the Southern District of New York, Weisfelner, v. Fund 1, et al. (In re Lyondell Chem. Co.), 2014 Bankr. LEXIS 159 (Bankr. S.D.N.Y.

A Delaware bankruptcy court recently limited a secured creditor’s right to credit bid an acquired claim to the purchase price of that claim. In In re Fisker Auto. Holdings, Inc., 2014 Bankr. LEXIS 230 (Bankr. D. Del. January 17, 2014), the United States Bankruptcy Court for the District of Delaware addressed a motion by Fisker Automotive, Inc. (“Fisker”) to sell substantially all of its assets (the “Sale Motion”) to Hybrid Tech Holdings, LLC (“Hybrid”).

In a recent decision by the influential Third Circuit Court of Appeals, In re KB Toys Inc., 2013 U.S. App. LEXIS 23083 at *17 (3d Cir. Nov. 15, 2013), the Court decided that “the cloud on the claim” stemming from a preferential payment made to the original claimant continues with the claim, which then could be disallowed.