Standard Profil’s scheme of arrangement was sanctioned by the English High Court on 9 September 2025, notwithstanding a recent Frankfurt court decision casting doubt on whether English restructuring plans and schemes of arrangement proposed by German companies would be capable of sanction by the English courts going forward as a result of recognition issues (see ‘More on this topic’).

When a company is in financial distress, directors face difficult choices. Should they trade on to try to “trade out” of the company’s financial difficulties or should they file for insolvency? If they act too soon, will creditors complain that they should have done more to save the business? A recent English High Court case raises the prospect of directors potentially being held to account for decisions that “merely postpone the inevitable.”

When a company is in financial distress, its directors will face difficult choices. Should they trade on to trade out of the company's financial difficulties or should they file for insolvency? If they delay filing and the company goes into administration or liquidation, will the directors be at risk from a wrongful trading claim by the subsequently appointed liquidator? Once in liquidation, will they be held to have separately breached their duties as directors and face a misfeasance claim? If they file precipitously, will creditors complain they did not do enough to save the business?

In Sian Participation Corporation (In Liquidation) v Halimeda International Ltd [2024] UKPC 16, the Privy Council considered an appeal from the Court of Appeal of the Eastern Caribbean Supreme Court (BVI) as to whether a company should be wound up where the debt on which the winding up application is based is subject to an arbitration agreement and is said to be disputed and/or subject to a cross-claim.

The U.S. Court of Appeals for the Seventh Circuit recently upheld a trial court’s rejection of a borrower’s allegations that a mortgagee and its servicer violated the federal Fair Credit Reporting Act and the federal Fair Debt Collection Practices Act by allegedly inaccurately reporting her loan as delinquent following the borrower’s successful completion of her bankruptcy plan, allegedly rejecting her subsequent monthly payments, and filing a foreclosure action based on the supposed post-bankruptcy defaults.

The collapse of UK retailer British Home Stores ("BHS") in 2016 remains one of the most high-profile corporate insolvencies of recent times. It went from being a household name across the UK, with over 11,000 employees, to having reported debts of £1.3 billion, including a pension deficit of nearly £600 million. The group's demise saw the closure of some 164 stores nationwide and significant job losses.

Seven years after the British Home Stores Group Limited, a well known high street retailer, and its operating subsidiaries entered liquidation, the High Court has found two former directors liable for wrongful trading and misfeasance.

Background

The U.S. Court of Appeals for the Eleventh Circuit recently held that the anti-modification provision in the federal Bankruptcy Code applies to loans secured by mixed-use real properties, such as the large parcel at issue here which functioned both for commercial use and as the debtor’s principal residence.

A copy of the opinion in Lee v. U.S. Bank National Association is available at: Link to Opinion.

The High Court has found that a borrower's debenture granted to a lender in respect of certain internet protocol (IP) addresses was a floating charge.

In a case brought by the liquidators, the High Court found two former directors liable for wrongful trading; that is, continuing to trade when they knew or should have known that there was no reasonable prospect of avoiding insolvency (section 214 of the Insolvency Act 1986).