The UK Supreme Court has handed down an important judgment in the conjoined cases of Rubin and another v Eurofinance SA and others and New Cap Reinsurance Corporation (in Liquidation) and another v AE Grant and others [2012] UKSC 46, which provides vital clarification on the effect of foreign insolvency judgments on the UK courts. The judgment was handed down yesterday.
Background & Court of Appeal
On 9 October 2012, a bill proposal was introduced to the Luxembourg Parliament providing for a right to claim back "intangible" and non-fungible movable assets from a bankrupt company.
According to the explanatory memorandum, the bill proposal is intended to allow the recovery of data from a bankrupt provider of distance IT services or cloud computing solutions. Once passed, the law will provide greater certainty as to the consequences of the bankruptcy of a cloud computing provider on the data in its possession.
"Separable" Assets
On 13 June 2012 the Financial Institutions (Special Measures) Act (Wet bijzondere maatregelen financiële ondernemingen; "Intervention Act") entered into force with retro-active effect as of 20 January 2012). The Intervention Act includes new powers for the Netherlands Central Bank ("DNB") to procure that a bank or insurer which is experiencing serious financial problems is transferred, in whole or in part, to a third party.
Those thinking that the trials and tribulations of the recession may have passed them by and that, if all else failed, at least the pension was safe, may have to think again following two recent court decisions in which pensions came under attack from creditors and trustees in bankruptcy.
The vexed question of whether a future right to receive a pension can be attached to satisfy a judgment, or can be claimed by a trustee in bankruptcy, has long since troubled the courts.
An administrator who was sued in relation to contractual liabilities which he entered as administrator of a company was found to have no personal liability for those contracts or for the costs of the litigation.
In the recent case of Wright Hassall LLP v Morris1 the claimant advanced various arguments in an attempt to make the administrator personally liable for a costs order in litigation where the defendant companies were unable to pay. These arguments were rejected.
The High Court has held that where litigation is commenced against the administrator of a company, arising out of contractual obligations entered into in that capacity, he or she will not be personally liable, despite the insolvent company being unable to meet the resulting liability.(1)
The courts and FOS are now headed down very different paths in their approach to credit crunch losses suffered by clients of regulated firms. While FOS has all but abandoned the general law of causation in its approach to cases of consumer detriment, we have observed how the courts have held again and again that the general law of causation applies to mis-selling claims.