A recent TCC decision has ruled that adjudication proceedings cannot be brought by companies in liquidation in relation to financial claims under a construction contract. The decision will have considerable ramifications for the practical management of liquidations for companies with exposure to construction contracts. The decision would appear to run contrary to current liquidator practice, both as to the use of adjudication proceedings in liquidations and as to the assignment of claims to third parties, but essentially only confirms the mandatory nature of insolvency set-off.
Speed read
The British government has commenced an airline insolvency review, in the wake of recent high profile airline failures such as Monarch and Air Berlin, and on the premise that changes in the industry have outpaced protection regimes.
The review will focus on two main areas: repatriation of stranded passengers and redress for consumers. There is a desire to minimise repatriation costs falling on the public purse and ensure that consumers have clear avenues of redress.
We closed the first quarter of 2018 following a period of intense scrutiny on the restructuring and insolvency profession. The stress in the retail and dining sectors, the increase in CVAs and the various attendances of stakeholders in the profession before Select Committees has been the forerunner to two consultation papers.
The Inner House of the Court of Session has found that, where a business had no realistic prospect of continuing in existence, it was not appropriate to assess whether a property was sold at an undervalue by reference to a forced sale valuation.
The Court’s judgment serves as a valuable reminder of some fundamental principles of insolvency law.
The facts
A recent TCC decision has concluded that the contractor insolvency provisions of the JCT form continue to apply after a termination by the contractor for repudiation. This conclusion may give rise to surprising results and potentially allow an employer to claim from the contractor additional amounts incurred in completing the works with a third party even after termination for the employer’s own default and/or repudiation.
Het voorontwerp Wet homologatie onderhands akkoord ter voorkoming van faillissement moet het een in financieel zwaar weer verkerende onderneming mogelijk maken om buiten faillissement of surseance haar schulden te saneren door een akkoord op te leggen aan alle schuldeisers. Een faillissement kan hiermee worden voorkomen. De rechten van schuldeisers en aandeelhouders kunnen hierbij worden gewijzigd.
In Hellas Telecommunications (Luxembourg) [2017] EWHC 3465 (Ch), the High Court ordered respondent liquidators to disclose the identity of third-party litigation funders and the terms on which funding was provided in order to facilitate an application for security of costs.
Facts
November 2017 saw the first successful pre-packaged bankruptcy of a wind farm operator following the introduction of this procedure to Polish bankruptcy law in January 2016. Thanks to a decision made by the bankruptcy court in Warsaw, the assets of the 6 MW wind farm in Korzęcin can now be taken over by a publicly listed company operating in the renewable energy sector.
Introduction
On 17 November 2017, the Supreme Court confirmed the existing case law that if employees are entitled to payment in cash for unused leave due to the bankruptcy of their employer, such claims are considered to be estate debts, regardless of when the entitlement to such leave accrued (ECLI:NL:HR:2017:2907). This ruling was given as a response to a request for a preliminary ruling by the Leiden Subdistrict Court.
On 12 December 2017, creditors in the long running special administration of failed stockbroking firm, MF Global UK Limited (“MF Global”), approved a company voluntary arrangement (“CVA”). This case demonstrates the flexibility of the CVA procedure and the role it can play in complex financial services cases.
What is a CVA?