Following the High Court’s landmark case in 2023 where cryptocurrency was recognised by the Court as property and could form a subject matter of a trust, the High Court recently further clarified the trust relationship between exchanges and their customers. Non-Consenting Customers (NCCs) who did not accept the 2018 Terms and Conditions (T&C) were found to have a proprietary interest in their assets, giving them priority in the liquidation process. Conversely, customers who had agreed to the T&Cs were treated as unsecured creditors.

In this first of a series of articles looking at current issues and recent case law in the world of distressed PFI/PPP projects, we consider the recent outcome of the Tameside Hospital dispute, and what pointers can be taken from it which may help avoid or resolve disputes in future so that distressed projects can get back on track. This is a tale of disagreement, adjudication, threats of insolvency, Court proceedings and – ultimately – a settlement which may offer a useful benchmark to which other troubled projects can have regard.

The opening of safeguard or reorganisation proceedings does not automatically terminate a current agreement notwithstanding any contractual clause providing for termination.

Termination by a lessor

The liquidator of UKCloud Ltd (the Company) applied to the court for directions as to whether a debenture granted by the Company created a fixed or floating charge over certain internet protocol (IP) addresses. The lender argued that it had a fixed charge.

Fixed or floating?

Background

The administrators of Toogood International Transport and Agricultural Services Ltd (in administration) issued an application seeking an extension of the administration. Their application also asked the court whether consent to a previous administration extension should have been obtained from a secured creditor which had been paid in full before the extension process.

Once a creditor, always a creditor?

The German Federal Court of Justice (Bundesgerichtshof) has clarified the conditions under which incongruent collateral, granted when an insolvency is imminent, can be contested. The burden of proof is placed on the defendant creditor to demonstrate that the action was part of a serious restructuring attempt.

Background

In a recent judgment, the Polish Supreme Court resolved an important question concerning the rights of a creditor to bring legal proceedings after the initiation of bankruptcy proceedings by a debtor.

Legal issue

The Supreme Court considered whether the declaration of a debtor's bankruptcy results in the loss of a creditor's standing to bring a lawsuit to declare a debtor’s attempt to dissipate its assets ineffective (actio pauliana).

What is actio pauliana?

The Austrian Supreme Court recently considered whether the knowledge of a debtor may be attributed to a third party in an avoidance action.

Background

In a recent decision, the German Federal Court of Justice (BGH) further outlined the requirements for the avoidance of a transaction under insolvency law on the grounds of wilful disadvantage to creditors pursuant to section 133 of the German Insolvency Code (InsO).

Background

Background

Crabb was the sole director of Courtside Recycling Ltd (Courtside). From 2014 to 2018, Crabb instructed Courtside's accountants to file VAT returns but only provided bank statements for one of the Company's three bank accounts. As a result, the VAT assessments significantly understated Courtside's true VAT liabilities for this period.

Following its own investigation and using transaction information gathered from Courtside's other bank accounts, HMRC issued amended VAT assessments. Courtside was unable to pay its VAT liabilities.