October Bankruptcy Developments

Australia has posted a record fall in its GDP in 2020. At the same time, following a series of temporary measures introduced due to COVID-19, Australian insolvency filings have hit record lows.

In a victory for minority noteholders opposing an out-of-court restructuring of their distressed issuer, New York's highest court ruled last week that a holder's right to receive or sue for payment on its notes survived an exercise of statutory remedies by the trustee, conducted at the direction of a noteholder majority, that would have cancelled the holder's notes without its consent and replaced them with equity securities.

1. Background and Overview

As described in our Client Alert "The new German business stabilization and restructuring regime ("German Scheme")" dated 12 October 2020, the German Federal Ministry of Justice and Consumer Protection had presented a draft bill (the "Original Bill") to introduce a new business stabilization and restructuring framework - the new "German Scheme" - into German law.

This week’s TGIF looks at a recent case where the Federal Court ordered the reinstatement of two companies to allow proceedings to be commenced against the liquidator of those companies for alleged breaches of duty (Lee v Parker [2020] FCA 1453).

Key takeaways

The German Federal Ministry of Justice and Consumer Protection has recently presented the longawaited draft bill to introduce a new pre-insolvency business stabilization and restructuring regime into German law.1 The availability of this ground-breaking new "German Scheme" will significantly change the German restructuring landscape and elevate it to an internationally competitive level.

This week’s TGIF looks at the decision of the Supreme Court of Victoria in Re Barokes Pty Ltd (in liq)

On Monday 14th September 2020, Mrs Justice Falk issued her reasoned judgment, in respect of the application by Codere Finance 2 (UK) Limited (the "Company") to convene a single class of its creditors to consider and vote on a proposed scheme of arrangement under Part 26 of the Companies Act 2006 ( the "Scheme").

In a hearing spanning three days, the High Court of England and Wales addressed multiple grounds of challenge from a dissenting noteholder but nonetheless granted the Company's request to convene a single meeting of its scheme creditors.

Background

This week’s TGIF looks at the NSW Supreme Court’s recent guidance on factors relevant to whether a winding up ought be terminated.

Key takeaways

This week’s TGIF discusses the key elements of the Federal Government’s recently announced reforms to insolvency laws for businesses with liabilities below $1 million.

Key takeaways