On January 5, 2015, HM Treasury published the Bank Recovery and Resolution Order 2014 (“BRRO”) and the Banks and Building Societies (Depositor Preference and Priorities) Order 2014 (“BBSO”). The Banking Act 2009 (Restriction of Special Bail-in Provision, etc.) Order 2014 and the Banking Act 2009 (Mandatory Compensation Arrangements following Bail-in) Regulations 2014 were published in December 2014.
On December 19, 2014, the UK Insolvency Service reported that two former directors of Connaught Asset Management, Nigel Walter and Michael Anthony Davies, have both been disqualified from controlling or managing a company for a period of 9 and 7 years respectively. The former directors allowed the misuse of up to £106m of investor money by failing to review the progress on loans made with monies borrowed from funds and not ensuring the money was repaid to the fund following loan completion.
The press release is available at:
While it is common practice in Canada to seek certain emergency orders on an ex parte basis (i.e. where only one party (and not the adversary) appears before a judge), applicants for such orders are held to a high standard of candour with the court.
Many secured creditors see their position in absolute terms. They rely on their general security and aggressively assert their priority over unsecured creditors, such as trade creditors. However, a recent decision of the Ontario Court of Appeal(306440 Ontario Ltd. v. 782127 Ontario Ltd. (Alrange Container Services), 2014 ONCA 548) demonstrates that creative arguments by trade creditors may allow them to take priority over even secured creditors in certain circumstances, by using trust principles to remove assets from the estate.
Dealing a major blow to the trustee’s efforts to recover fraudulent transfers on behalf of the bankruptcy estate of the company run by Bernard Madoff, Judge Jed S. Rakoff of the United States District Court for the Southern District of New York held in SIPC v. Bernard L. Madoff Investment Securities LLC1 that the Bankruptcy Code cannot be used to recover fraudulent transfers of funds that occur entirely outside the United States.
Facing the imminent bankruptcy of the federal Highway Trust Fund (the “HTF”) and the specter of delays and reductions in payments from the HTF to the States, the US Congress last week passed the Highway and Transportation Funding Act of 2014, which extended federal surface transportation programs and funding through May 2015. We summarize below the key elements of the Act.
SHAREHOLDERS ARBITRATION
In a historic USD 50 billion award rendered on July 18,
2014, an Arbitral Tribunal constituted pursuant to the
Energy Charter Treaty held unanimously that the Russian
Federation breached its international obligations under the
Energy Charter Treaty by destroying Yukos Oil Company
and appropriating its assets.
The Tribunal, applying the UNCITRAL Arbitration Rules and sitting in The
ague under the auspices of the Permanent Court of Arbitration ordered the
The Take-Away
Missing the limitations period for bringing a court action to recover a debt does not extinguish other legal rights and remedies in respect of that debt, such as bringing an application for bankruptcy or proving a claim in a bankruptcy estate.
The Case
In the recent decision of Frank v. Farlie, Turner & Co., LLC, 2011 ONSC 5519, Mr. Justice Perell of the Ontario Superior Court of Justice found, among other things, that punitive damages are not available under Part XXIII.1 of the Ontario Securities Act as such damages are inconsistent with the scheme and purpose of Ontario’s statutory secondary market disclosure liability regime. In so doing, the court confirmed the fundamental importance of liability limits in continuous disclosure claims against directors and officers.
- Leases Over One Year Must be Registered in all Provinces Except Québec
In recent years the Ontario Personal Property Security Act (“PPSA”) changed the scope of its application to include all leases for a term of more than one year, regardless of whether it is a “true” or “financing” lease. This is a different rule than exists in the United States and one often missed on cross border transactions.