The remaining credit after the cancelation of its guarantee through an assignment in lieu of payment (dación en pago) in favor of a creditor with a lower-ranking guarantee is an ordinary credit and cannot be subject to a new classification

The insolvency administration is authorized to sell the production unit of the insolvent company Antibióticos, S.A.U. to Black Toro Capital S.A.R.L.

Judgment of the Supreme Court of Justice of 1 July 2014 

This judgment concludes that the Insolvency Plan is an alternative corporate recovery  measure which aims to satisfy the interests of the creditors, which applies  indiscriminately to natural and to legal persons. When the insolvent is a natural person,  the fact that the liquidation of its assets within the insolvency proceedings took place  without the full payment of the claims, is still not enough to declare the release of the  debtor.

On 27 July 2014, the Regulation (UE) n.º 655/2014, of the European Parliament and of  the Council (the “Regulation”), establishing a European Account Preservation Order procedure to facilitate cross-border debt recovery in civil and commercial matters was  published.

In June 2013 the Complaints Gateway was established to provide a single entry point for regulatory complaints against insolvency practitioners.  The Insolvency Service has published an analysis of the complaints received by the Complaints Gateway in its first 12 months; the headline being an increase in complaints being made against insolvency practitioners from 748 to 941 complaints.

INTRODUCTION

Court of Appeal denies input tax on accountancy services relating to arefinancing and restructuring process: Airtours Holiday Transport Limited vHMRC5

Financial institutions are not de facto directors of the insolvent company because they do not significantly affect the performance of the insolvent company’s activity, but only ensure that  certain costs do not affect the repayment of their loan.

The extension of the term for the delivery of works not authorized by the guarantor that had secured  the penalty for delay does not  harm it and, therefore, the guarantee is not  extinguished;  any increase in the  penalty agreed does not extinguish the guarantee,  but  cannot be enforceable on the guarantor that will be liable in the terms agreed in the initial  agreement. This decision discussed the effects  on the guarantee of  the novation of the  secured  obligation agreed without the guarantor’s knowledge.

The rescission was declared of a mortgage the insolvent company  granted over a  warehouse it owned in guarantee of the  loan a credit institution  had  granted to a company of its group. The Supreme Court declared (i) that the contextual guarantee was  for consideration and (ii) the need for proof of the profit (even indirect) of the guarantor  company without merely belonging to the  group sufficing, and  confirmed that the  rescission only affected the guarantee and not the loan.