Industrial and manufacturing businesses face all kinds of challenges: pricing and competitive pressures; regulatory demands; cross-border trade regulations and obligations; and litigation risk stemming from environmental and tort claims. These challenges create risks around every corner, some even rising to the level of "bet-the-company" issues – the things that keep GCs up at night.
The Singapore High Court has again confirmed that a winding-up application concerning a disputed debt that is subject to an arbitration agreement will be dismissed if the arbitration agreement is prima facie valid and covers the dispute. This prima facie standard of review was first formulated three years ago by the Singapore Court of Appeal in AnAn Group (Singapore) Pte Ltd v VTB Bank (Public Joint Stock Company) [2020] SCGA 33.
Addressing an issue of first impression, the Second Circuit held recently that bankruptcy courts have inherent authority to impose non-nominal civil contempt sanctions, including per diem sanctions and attorneys’ fees, arising out of an attorney’s failure to comply with the bankruptcy court’s discovery orders.
Three recent Hong Kong first instance court decisions have left undecided the question of whether a winding-up petition will trump an agreement to arbitrate when it comes to a winding-up and particularly in the context of cross-claims. A Court of Final Appeal decision this spring had seemed to provide pointers that the parties' agreement would be upheld but the issue – particularly when it comes to unmeritorious and late arbitration applications – is dividing the courts.
When debt restructuring discussions are at an impasse and the reservoir of goodwill between the parties has run dry, stakeholders face difficult choices. For a lender, one of the most powerful tools available is the exercise of rights under a voting proxy given by a parent holding company in connection with a pledge of a borrower’s stock or membership interests. Through the exercise of proxy rights, lenders may replace a borrower’s board of directors with a new board made up of independent directors.
In the case of Re Guangdong Overseas Construction Corporation [2023] HKCFI 1340, the Honourable Madam Justice Linda Chan recognized and provided assistance to a mainland China appointed administrator over a mainland China company in liquidation despite the administrator's application being outside the scope of the insolvency cooperation mechanism between Hong Kong and mainland China courts. The Hong Kong court affirmed that its jurisdiction to recognize and assist office-holders appointed by a court of another jurisdiction derives from common law.
As we have written here on multiple occasions, the Private Attorneys General Act (PAGA) disadvantages employers in several ways. Despite permitting recovery similar to what might be obtained in a class action, class certification rules do not apply and it is an open question whether courts can even limit an unmanageable claim before trial.
A Hong Kong court has reminded debtors of the need to present a credible and realistic restructuring proposal when facing creditors threatening winding up actions. In Re Jiayuan International Group Limited (佳源國際控股有限公司) [2023] HKCFI 1254, the Honourable Madam Justice Linda Chan warned that it is not enough for a debtor company to merely point to commercial discussions with some of the creditors when seeking an adjournment.
The administrators of Avanti Communications Limited (the “Company”) sought directions from the High Court as to whether purported fixed charges in favour of the secured lenders to the satellite operating business should be recharacterised as floating charges (In the matter of Avanti Communications Limited (In administration) [2023] EWHC 940 (Ch)).
Summary of decision