Section 1104(a)(2) of the Bankruptcy Code provides for the appointment of a chapter 11 trustee “if such appointment is in the interests of the creditors, any equity security holders, and other interests of the estate . . . .” While it is not often that we see a court displace management pursuant to section 1104(a)(2), it does happen on occasion. One such recent case is In re China Fishery Group Limited. Case No. 16-11895 (Bankr. S.D.N.Y. Oct. 28. 2016), where Judge James L. Garrity, Jr.
The insolvency profession (and the Queensland market in particular) has been abuzz this year with the issue of CORA – a shorthand reference to theEnvironmental Protection (Chain of Responsibility) Amendment Act 2016 (Qld).
What does it mean for insolvency practitioners? Can banks really be hit with a bill to clean up their borrowers’ environmental damage? Will turnaround and restructuring professionals refuse to accept appointments out of fear of falling foul of the new regime?
This post explains what you need to know.
In early November, the Ninth Circuit held in In re New Investments, Inc. that a debtor was required to “cure” defaults to an agreement using a post-default interest rate, overturning its prior, decades-old decision In re Entz-White Lumber & Supply, Inc., which had held that a debtor could cure agreements at pre-default interest rates.
Background
On 22 November 2016, the European Commission announced a draft directive on insolvency, restructuring and second chance in the EU in the form of the EU Business Restructuring Directive (the “Proposed Directive“) which can be read here.
‘Shipping steel, shipping steel . . .
Nobody knows, the way it feels
Caught between Heaven and the Highway
Shipping steel, shipping steel . . .’ 1
On 7 April 2016, Administrators were appointed to South Australian-based steelmaker and iron ore miner Arrium, which reportedly owed approximately AUD4.3 billion to its lenders, suppliers and staff. The appointment covered 94 direct and indirect subsidiaries of Arrium Limited (the Arrium Companies), which at the time employed around 8,100 employees and contractors.
Unscrupulous advisors, unconscionably preying on desperate directors driven by the fear of losing everything, have created a boom in illegal phoenix activity. The below article, originally published on the McCullough Robertson white collar crime blog, Collared, sheds some light on the illegal phoenix, the gravity of the problem in Australia and considers what is being done to monitor and control the issue.
Hoku, a publicly-owned Delaware corporation, filed for bankruptcy with just $8 million in assets compared to a relatively staggering $1.3 billion in liabilities, much of which was funded debt. In light of this significant insolvency, Hoku’s chapter 7 trustee brought various breach of fiduciary claims against Hoku’s board of directors, including one akin to a claim for “deepening insolvency.” As the case of Hopkins v.
In August I presented on cross-border insolvency at the joint Federal Court of Australia and Law Council of Australia conference on corporations law. The audience consisted of over 30 Federal Court judges and a range of other experienced corporate and insolvency lawyers.
There have been recent reports that APR Energy PLC has threatened the Australian Government with a demand for $200 million in damages based on a claim under the Australia-United States Free Trade Agreement after it lost its security interest in multi-million dollar wind turbines it leased to an Australian company due to the operation of a provision in the Personal Property Securities Act 2009 (Cth) (PPSA).
On Friday 7 October 2016, McCullough Robertson successfully obtained orders on behalf of a US Chapter 7 bankruptcy trustee, requiring payment to her of money held by the Public Trustee of Queensland (Public Trustee) on behalf of a US bankrupt and her former husband. As far as we know, this is the first time that the Model Law on Cross-Border Insolvency (Model Law) has been used in Australia to obtain an order allowing the repatriation of funds to a foreign representative that are not the foreign debtor’s assets.