The Court of Appeal’s ruling in Neumans LLP v Andrew Andronikou & Ors [2013] EWCA Civ 916 has provided some useful guidance to insolvency practitioners on the courts’ approach to administration and liquidation expenses.

Pre-match warm up

InRe Bock inc.¹, a recent case decided under the Companies' Creditors Arrangement Act ("CCAA"), the Superior Court of Quebec made an order reviving a dealership agreement that was purported to be validly terminated by the manufacturer prior to the commencement of any insolvency proceedings.

On June 1, 2013, British Columbia's new Limitation Act (the "New Act")¹ came into force, changing the limitation periods for filing civil lawsuits in British Columbia.

Following the announcement that Crystal Palace Football Club had gone into administration in January 2010, the club's administrator wanted to sell the club as a going concern. Shortly after he  signed a sale and purchase agreement with the newly formed Crystal Palace Football Consortium (CPFC) he discovered that the club had severe financial problems and decided to 'mothball' the club during the out of season period, in the hope of selling it in the future. However CPFC then decided to withdraw its offer for the club and on 28 May 2010 the four claimants were made redundant.

The highly anticipated decision of the Supreme Court of Canada in Re: Indalex was released this morning.

Here are the key highlights:

On July 6, 2012, in Lightsquared LP (Re),¹ the Ontario Superior Court of Justice (the "Ontario Court"), released reasons that clarify the criteria for the identification of the centre of main interest ("COMI") of an applicant seeking recognition of foreign insolvency proceedings as "Foreign Main Proceedings" pursuant to Section 46 of the Companies' Creditors Arrangement Act ("CCAA").²

introduction

The British Columbia Supreme Court recently reviewed the considerations to be applied on an application by a secured creditor to lift a stay of proceedings granted in an initial order under the Companies' Creditors Arrangement Act (the "CCAA"). In Re Azure Dynamics Corp.,¹ Madam Justice Fitzpatrick confirmed that the classic "doomed to fail" argument will not be persuasive where the applicant creditor is not prejudiced, and where the objectives of the CCAA are best served, by allowing the stay of proceedings to continue.

background

Whether rent due should be treated as an insolvency expense (paid in preference to unsecured creditors and the insolvency practitioner's fees/expenses) remains controversially topical. With the economic recovery being more of a marathon than a sprint, and more insolvencies anticipated, both landlords and insolvency practitioners (IP) are calling for greater clarity over when rent is an insolvency expense and over what period.

On May 14, 2012, in 9-Ball Interests Inc. v. Traditional Life Sciences Inc.¹, the Ontario Superior Court of Justice (the "Court") rendered another decision that demonstrates the importance of full disclosure and transparency in applications made to the Court.