The Supreme Court’s long-awaited decision in the Sequana case (handed down on 5 October 2022)[1] is the first time that the UK’s highest court has been asked to consider the proposition that directors are, in certain circumstances, under a duty in respect of creditors’ interests as distinct from shareholders’ interests.
The key takeaway points from this ‘momentous decision for company law’ (the words of Lady Arden who gave one of the leading judgments) are:
The Judgment of the Supreme Court in BTI 2014 LLC v Sequana SA was handed down on 5 October 2022.
The Supreme Court considered the circumstances in which company directors must exercise their duties under s.172 Companies Act 2006 (CA06) with regard to the interests of the creditors and affirmed the position reached by the Court of Appeal.
Comment
In the years since its independence, Ukraine's public and private sectors have faced one crisis after another. Notwithstanding different factors causing distress and incomparable peculiarities of each, restructuring has always remained one of the key mechanisms to make it through these difficult periods and get back on track. This includes the current crisis due to Russia’s invasion of Ukraine. Even in the present unprecedent environment, inaction is not a solution.
On 17 July 2022, Law 216/2022 came into force amending and supplementing Law No. 85/2014 on insolvency prevention and insolvency proceedings and other normative acts.
Law 216/2022 also amended Romanian Companies Law No. 31/1990 (Romanian Companies Law) on the duties of directors if a company is likely to become insolvent. Also, the law brings derogations from the provisions of the Romanian Companies Law on calling deadlines for shareholders’ meetings in those specific cases when a restructuring agreement or approval of the restructuring plan has been confirmed.
Summary
Restructuring Plans (“Plan(s)”) were introduced by the Corporate Insolvency and Governance Act 2020 (“CIGA”) as a rescue tool for companies in financial difficulty to compromise debt and other liabilities owed to secured and unsecured creditors and its members, with the court’s sanction.
The new Companies House Register of Overseas Entities (the “OE Register”) became operational and key parts of the Economic Crime (Transparency and Enforcement) Act (“ECTEA”) came into force on 1 August 2022.
The land registration elements of ECTEA have been deferred and will come into force on 5 September 2022 – this second stage of implementation will with effect from such date have an immediate impact on the registration of property acquisitions and new leases and security being taken over those acquisitions/leases.
Some 13 years ago, Lehman Brothers' sudden and unexpected insolvency sent ripples across the banking and financial services market, some of which are still felt today.
The Court of Appeal's decision in the consolidated cases of Lehman Brothers Holdings Scottish LP 3 v Lehman Brothers Holdings plc (in administration) and others1 [2021] EWCA Civ 1523 was the latest in a long line of cases seeking to unwind the issues arising from Lehman Brothers' unexpected collapse.
The background
Summary
The Insolvency Service has released its report on CVAs (the “Report”), which was commissioned in response to the significant concerns raised by the commercial property sector in recent years and the legal challenges launched by landlords against a number of CVAs.
In Stephen John Hunt (Liquidator of Marylebone Warwick Balfour Management Ltd) v Richard Balfour-Lynn and others [2022] EWHC 784 (Ch), the High Court decided that the directors of a company which went into liquidation after participating in an ineffective tax avoidance scheme did not breach their fiduciary duties and payments made pursuant to the scheme were not transactions defrauding creditors.
Background
Cryptoassets are in the spotlight for many reasons. The use of cryptocurrencies as an alternative to fiat currencies is being explored and tested further by global events. Their correlation with traditional stores of value is being tested in volatile markets. Their status as both a potential means of avoiding sanctions and as a possible means of funding charitable and humanitarian causes is being demonstrated and discussed.