In Joint and Several Liquidators of Yes! E-Sports Asia Holdings Limited (in Liquidation) v Holman Fenwick Willan (A Firm) [2024] HKCFI 1197, the Court confirmed that solicitors should produce documents of former insolvent clients to liquidators when a request is made under section 286B(1)(d) of the Companies (Winding Up and Miscellaneous Provisions) Ordinance, Cap 32 (CWUMPO).

In Bolwell & Anor v NWC Finance Pty Ltd & Ors [2024] VSC 30, the Supreme Court of Victoria clarified that a lawyer will not be a "controller" of property within the meaning of section 9 of the Corporations Act 2001 (Cth) (the Act) simply because it was retained to act for a mortgagee exercising their power of sale.

This judgment provides comfort to lawyers as it confirms that they will not assume the obligations of a "controller" under the Act solely by reason of them acting in connection with the sale of real property in an insolvency context.

The England and Wales Court of Appeal recently handed down its first judgment relating to a restructuring plan under Part 26A of the UK Companies Act 2006: Re AGPS Bondco Plc [2024] EWCA Civ 24. Restructuring plans were a 2020 innovation in UK insolvency law, as described in our earlier alert.

Hip Hing Construction Company Ltd v Hong Kong Airlines Limited [2024] HKCFI 370, concerned clause 32.5 of the General Conditions of the Standard Form of Building Contract (2005 Private Edition) (GCC 32.5) which relates to retention money. It provides that the retention shall be held upon trust by the Employer for the Contractor and any Nominated Sub-Contractor or Nominated Supplier, subject to the rights of the Employer to have recourse to it for payment of any amount which he is entitled to under the Contract or at law or to deduct from it any sum owed to him by the Contractor.

On 19 July 2023, the parliament of the Grand Duchy of Luxembourg (Luxembourg) passed bill no. 6539A into law (the New Insolvency Law), marking a significant milestone in the movement to modernise and enhance the competitiveness of Luxembourg’s insolvency framework. The bill has been under discussion for a number of years and aims to curtail the use of bankruptcy as an insolvency solution in favour of the preemptive preservation or reorganisation of financially distressed companies.

The Law Commission published its Report on digital assets on 28 June 2023. It covers discussions on crypto-token collateral arrangements and apportionment of shortfall losses on the insolvency of a custodial holding intermediary.

To summarise, the Law Commission has made various recommendations in the Report, including that:

After a 10-month inquiry process, on 12 July 2023 the Parliamentary Joint Committee on Corporations and Financial Services (PJC) delivered its final report on the effectiveness of Australia’s corporate insolvency laws.

In this alert, we distil some of the key findings from the almost 400-page report and consider what future law reforms might look like.

A COMPLEX AND INEFFICIENT SYSTEM

The High Court of Australia in Metal Manufactures Pty Limited v Morton [2023] HCA 1 has confirmed the view of the Full Court of the Federal Court of Australia that the "set off" defence under section 553C of the Corporations Act 2001 (Cth) (Act) is no longer available to claims by liquidators for an unfair preference claim made under section 588FA of the Act.

This decision brings finality to claims brought by Creditor Defendants to such claims and no doubt brings much joy to liquidators across Australia.

The Hong Kong Court has power pursuant to section 327 of the Companies (Winding Up and Miscellaneous Provisions) Ordinance (Cap. 32) to wind up a foreign-incorporated company in Hong Kong. Before the Court can exercise its statutory jurisdiction, the following three well known “core requirements”, cited by the Court of Final Appeal in Kam Leung Siu Kwan v Kam Kwan Lai (2015) 18 HKCFAR 501, must be satisfied:

Since the signing of a record of meeting concerning mutual recognition of and assistance to insolvency proceedings between the courts of Mainland China and Hong Kong in May 2021, there have been a number applications for letters of request to be issued by the Hong Kong Court to the Bankruptcy Court of the Shenzhen Intermediate People’s Court.