The High Court has held that disclosure of debts and undertakings given to the Circuit Court in seeking a protective certificate for a personal insolvency arrangement can be relied on in other proceedings.

Background

The McLaughlins were engaged in a long running saga of litigation with Bank of Scotland plc (“BOS”) and, after a loan sale, Ennis Property Finance Limited (“Ennis”).

In 2016 they issued High Court proceedings against Ennis and Tom Kavanagh (the “Plenary Proceedings”).

WHAT WE’VE BEEN UP TO

The team have been busy dealing with a wide range of instructions over the past few months.

Some of our recent highlights include:

Over the last 6 months, the Debt Recovery team has seen an increase in their monitoring of debtor companies and notification for proposals for striking off action. The team are actively reviewing and objecting to any such proposals with Companies House to allow their clients to continue to chase their debts.

The Small Company Administrative Rescue Process (SCARP) was commenced on Tuesday 7 December. Now that the process is available we set out some practical considerations for companies and creditors.

SCARP

Some of the UK Government’s COVID-19 supports for businesses came to an end, or started to taper off, on 30 September 2021. The UK Insolvency service published statistics yesterday showing that the number of corporate insolvencies has returned to pre-pandemic levels. There is no reason to believe that the Irish position will be substantially different when supports come to an end.

What happened when COVID-19 struck?

IN THE NEWS

Government lifts (in part) the temporary insolvency measures

On 9 September 2021, the government announced that the temporary restrictions introduced by the Corporate Insolvency and Governance Act 2020 (CIGA 2020) which were put in place to protect companies during the pandemic are being lifted, and will be replaced from 1 October 2021 with new temporary measures, which include the introduction of a temporary revised debt limit for presenting winding up petitions.

What have we been up to?

Aside from our collective (but not wholly unexpected) disappointment that the lifting of the remaining Covid restrictions has been pushed back to 19 July, the team continue to advise on a wide range of insolvency related matters, amongst the recent highlights being:

From 1 October 2021, those restrictions will be replaced by new measures brought about under the Corporate Insolvency and Governance Act 2020 (Coronavirus) (Amendment of Schedule 10 Regulations 2021) (the “Regulations”).

Under the Regulations, which are to be temporary and due to last until 31 March 2022, a creditor will be able to present a winding up petition against a corporate debtor where:-

(i) The debt is for a liquidated amount, which has fallen due and is not an ‘excluded debt’ (see below) (Condition A)

The Government has announced that it will be bringing an end (of sorts) to the temporary restrictions surrounding a creditor’s ability to present a statutory demand and winding up petition against a corporate debtor. Those restrictions, which were introduced under the Corporate Insolvency and Governance Act 2020 in a response to the Covid 19 pandemic, have been in place since June 2020 and were set to expire on 30 September 2021.

The recent restructuring of the Norwegian Group by the Irish High Court helpfully clarifies the application of the Cape Town Convention in Irish restructuring. It is also an interesting case study regarding the circumstances in which the Irish courts will restructure a group of companies, which is not headquartered in Ireland.