Usually, a Fixed Charge Receiver will not be liable to pay business rates. However, there are some exceptions and in some important areas the law is unclear.

Occupied Property: Limited Exposure

To be liable for business rates a party must be in occupation of the Property. This is a matter of fact and degree. Generally, the position is clear although there can be issues for example where more than one party is entitled to occupation.

Recent legislative reform in the water sector has expanded the special administration regime and there are further changes on the horizon

Next month marks the hotly anticipated sanction hearing for the Thames Water restructuring plan. We take this opportunity to look back at the key legislative changes made last year, as well as those earmarked for the future.

2024 legislative changes

New legislation was introduced last year to amend the special administration regime for the water sector.

The key changes to the existing regime were as follows:

We examine the findings of the High Court’s decisions and discuss the lessons which directors of distressed businesses should take from them

The collapse of BHS in April 2016 remains one of the most extraordinary corporate failures in recent memory. Eight years on from the commencement of insolvency proceedings, and following a lengthy trial, the High Court has issued an expansive judgment on claims brought by the joint liquidators of four companies in the group against two former directors.

Factual background

When individuals and certain entities (such as partnerships, trusts and other unincorporated bodies) have debts that they are unable to repay to their creditors, they may consider or be faced with bankruptcy, which is known as sequestration in Scotland. However, sequestration is just one avenue. Alternative statutory debt solutions are available, which can provide breathing space and allow debts to be repaid over time, without creditor pressure.

Although the law, rules and procedures governing corporate insolvency in Scotland and England and Wales are similar in many respects, Scotland has a separate legal system and there are some important differences in the provisions and rules applicable north and south of the border. The differences include:

For RSLs who are routinely contracting with housebuilders for golden brick delivery of affordable housing across multiple phases, we discuss the four key actions that can help if the housebuilder becomes insolvent.

1. Pre-Insolvency – Financial Distress Provisions and Due Diligence

Whilst most people would hope it could never happen to them, in our experience it often can. As such it pays to be prepared.

The first quarter of the year can often be a pinch point for tenants as they assess Christmas trading and scrutinise financial results. Where profits have failed to meet expectations then a tenant may require to consider formal insolvency proceedings but how does this affect the landlord? Here we consider some of the key questions for a landlord in Scotland facing tenant insolvency.

What is the status of the tenant?

Landlords might be starting to feel a little uneasy given the news that Superdry is considering a Company Voluntary Arrangement (CVA). Superdry is reportedly working with accountants to hash out a plan that will likely involve shutting down certain stores and cutting rent liabilities. The accountants instructed will be exploring whether either a CVA or a Restructuring Plan - both of which are processes which allow businesses to seek to reduce their liabilities to creditors – would be appropriate.

What exactly is a CVA?

When individuals are made bankrupt in Scotland, the formal term is 'sequestration', a trustee will be appointed to deal with the sequestration. That trustee will be responsible, amongst other things, for contacting creditors, assessing their claims, ingathering the assets of the debtor and converting them into cash in order to settle the costs of the sequestration and pay dividends to creditors.