Sova Capital Ltd (“Sova”) was an FCA authorised and regulated broker. Before it went into Special Administration, Sova provided investment brokerage services to institutional and corporate clients, mostly trading in the Russian market.

As of 17 April 2023 new creditors winding up petitions can be presented in accordance with the Insolvency (Amendment) Rules (NI) 2023. This means that the restrictions faced by creditors in filing winding up petitions will be lifted, and ultimately more companies will be open to pursual.

The war in Ukraine continues and the economic effect of sanctions against businesses that are connected to the Russian government are now being felt in earnest. Unsurprisingly, sanctions are becoming an increasingly hot topic for insolvency practitioners.

Recent months have seen the Courts hand down some important decisions, which provide helpful guidance on situations where the sanctions regime interfaces with insolvency processes. We have summarised three of the most significant in this article.

Summary

In the recent Court of Appeal decision Bacci v Green [2022] EWCA Civ 1393 the Court, upholding the decision of the High Court, held that a judgment debtor can be ordered to delegate authority to waive valuable tax protection and draw pension where doing so would enable creditors to extract what they were owed.

The Facts

In 2017, Matthew Green, son of established Mayfair art dealer Richard Green, committed fraud in obtaining loans from FundingSecure.

The Supreme Court handed down its judgment on the case of Rakusen v Jepsen on 1 March 2023, deciding that rent repayment orders cannot be made against superior landlords.

The case considered whether rent repayment orders (RROs) under the Housing and Planning Act 2016, could be made against immediate landlords only, or whether superior landlords are also liable. 

This is the third article in our series about sponsor licences. This article focuses on the effect of insolvency on a sponsor licence.

Businesses are facing challenging times in the current economic downturn and insolvency is a real possibility for many, with 5,595 company insolvencies in the third quarter of 2022[1] alone.

If a business is on the brink of insolvency this will potentially have an impact on any sponsorship licences held within the company group. But what are the implications of this and what does it mean for sponsored employees?

On 16th December 2022 the Bankruptcy Master released an update which advised that the restriction on filing new creditors' winding up petitions is likely to be lifted in the new term. The court has advised that further information will be issued to legal practitioners in advance of the new guidance.

On 28 October 2022, the High Court handed down judgment in the case of Alma Property Management Ltd v Crompton And Another [2022] EWHC 2671 (Ch).

In this case, the (freeholder) Claimant sought an order for specific performance of the (leaseholder) Defendants' repairing obligations under a lease of the common parts of a block of flats called North Tower in Manchester.

The Supreme Court has been given its first opportunity to “address the existence, scope and engagement of an alleged duty of company directors to consider, or to act in accordance with, the interests of the company’s creditors when the company becomes insolvent, or when it approaches, or is at real risk of, insolvency”. The corporate restructuring and insolvency community has been waiting for this “momentous” judgment with anticipation for the last 17 months.

The facts of the case:

The Supreme Court handed down its long-awaited judgment in BTI 2014 LLC v. Sequana S.A. [2022] UKSC 25 (Supreme Court - BTI v Sequana) concerning the fiduciary duty of directors to act in good faith in the interests of the company.