An application to admit witness evidence outside the directions timetable should be treated like an application for relief from sanctions under CPR 3.9 according to the High Court in Wolf Rock (Cornwall) Ltd v Langhelle.
Facts
As part of a complex series of related transactions, the debtor entered into a note purchase agreement with an investment bank. The agreement specifically disclaimed that the bank was acting as the debtor’s agent or owed the debtor any fiduciary duty. The note proceeds were to be used to pay the debtor’s shareholders to purchase their shares. The investment bank paid the proceeds directly to the shareholders. The trustee sought to avoid the payment as a fraudulent transfer.
On 11 September 2020, the Insolvency Act 1986 (HMRC Debts: Priority on Insolvency) Regulations 2020 were made. The Regulations will come into force on 1 December 2020.
The Regulations set out the debts due to HMRC that will have ‘secondary’ preferential status in insolvencies from 1 December 2020. They are debts in respect of PAYE income tax, employee NICs, construction industry scheme deductions and student loan repayments. VAT debts are to be treated in the same way, though are not covered by these Regulations.
In March 2020, Business Secretary Alok Sharma announced that provisions on wrongful trading would be suspended. The move came as part of a wider package of measures that sought to provide assistance to businesses – and their beleaguered boards – experiencing financial distress due to Covid-19.
Now set out in the Corporate Insolvency and Governance Act 2020 (CIGA), which was passed on 26 June 2020, the provisions adapt the wrongful trading regime making directors’ liability for the “relevant period” unlikely.
Why does it matter?
On 26 June 2020 the Corporate Insolvency and Governance Act (CIGA) came into force. The CIGA has made both permanent and short-term changes to the insolvency regime in response to the coronavirus pandemic and its consequences.
Why does it matter?
One of the permanent reforms provides that a contractual term of a contract to supply services or goods will be ineffective if:
The receivership debtors ran a Ponzi scheme. Acting under the state Uniform Fraudulent Transfer Act, the receiver sued the debtors’ bank to avoid bank deposits as transfers made with actual intent to hinder, delay, or defraud creditors. The UFTA defines “transfer” as any mode, direct or in
On 4 June 2020, a draft of The Insolvency Act 1986 (HMRC Debts: Priority on Insolvency) Regulations 2020 was provided to the Public Bill Committee. The Regulations are due to come into force on 1 December 2020.
The draft Regulations set out the debts due to HMRC that will have ‘secondary’ preferential status in insolvencies from 1 December 2020. They are debts in respect of PAYE income tax, employee NICs, construction industry scheme deductions and student loan repayments. VAT debts are to be treated in the same way, though are not covered by these draft Regulations.
The Corporate Insolvency and Governance Act ("the Act") came into expedited effect on 26 June 2020 and is intended to maximise the chance of corporate survival and reduce the threat of personal liability on directors during this unprecedented economic crisis.
D&O insurers should be clear about one thing: this Act will not help them and in fact it could well make things worse.
The Act