Dispute Resolution analysis: An application by a Russian trustee in bankruptcy has succeeded in striking out some parts of a defence to a claim that a share transfer was a sham or a transaction defrauding creditors. Other parts of the defence were not, however struck out.
Kireeva (as trustee and bankruptcy manager of Bedzhamov) v Zolotova and Basel Properties Limited [2024] EWHC 552 (Ch)
What are the practical implications of this case?
Dispute Resolution analysis: An application by the former administrators of a company for an increase in their remuneration has been dismissed, despite the Court concluding that they had standing to bring the application itself.
Frost and another v The Good Box Co Labs Limited and others [2024] EWHC 422 (Ch)
What are the practical implications of this case?
Dispute Resolution analysis: In November 2023, Mr Justice Miles sanctioned restructuring plans under section 901F of the Companies Act 2006 in respect of two companies within the Atento group. The plans had significant creditor support, did not involve any cross-claim cram down and achieved a demonstrably better outcome for creditors than the alternative, a group-wide liquidation.
Re Atento UK Ltd [2023] EWHC 3076 (Ch))
What are the practical implications of this case?
Conventional wisdom suggests there is no requirement that a debtor be “insolvent” to file a case under Chapter 11 or any other chapter of the Bankruptcy Code. No Code provision explicitly imposes such a requirement. Yet in 2023, several courts addressed the issue, and two courts directed the dismissal of massive Chapter 11 cases imposing what may fairly be characterized as an insolvency requirement.
Picture this: You are wrapping up writing a brief, memorandum of law, motion or the like regarding a complex bankruptcy issue. It is a close call, and you are grasping for additional arguments to make to the judge. Now ask yourself: Have I discussed the relevant burden of proof? If not, now ask yourself: Whose burden is it anyway?
The Eighth Circuit recently ruled that avoidance causes of action are property of the bankruptcy estate under § 541 of the Bankruptcy Code and thus may be sold by the trustee or debtor in possession. Pitman Farms v. ARKK Food Company, LLC, et al., No. 22-2011 (8th Cir. August 21, 2023). The ruling reinforces the notion that estate causes of action are assets that can be sold under § 363 of the Code, a practice which has been increasingly used in § 363 sales.
Theintroduction of Subchapter V in 2020 created a new avenue for small business debtors to more efficiently and effectively obtain relief under Chapter 11 of the Bankruptcy Code.
Dispute Resolution analysis: In a second appeal, the Court of Appeal has upheld the decisions of two lower Courts in concluding that due to the conduct of a bankrupt and his insolvency, his bankruptcy should not (on an exercise of discretion) be annulled, despite concluding that the bankruptcy order should not have been made.
Khan v Singh-Sall and another [2023] EWHC 1119 (Ch)
What are the practical implications of this case?
Under the Insolvency Act 1986 (IA 1986), office-holders are given wide powers but they are subject to the control of the court. In order to allow insolvency practitioners to carry out their duties efficiently and without having constantly to look over their shoulders, this control has always been exercised with a light touch. In recent years there have been several important cases examining these issues.[1]
After the tumult of the past few years, with emergency legislation being introduced to mitigate the impact of the Covid-19 pandemic, the last few months have felt relatively quiet in terms of new legislation. That said, there have been a number of important government publications in relation to the insolvency industry, and it appears that change is on the horizon.