We recently blogged (here) about the Privy Council decision of Sian Participation Corporation (In Liquidation) v Halimeda InternationalLtd [2024] UKPC 16 (
1.All eyes on redemption right
Redemption rights have increasingly been under the spotlight in the past year, as more and more investors contemplate an exit from under-performing investments.
As the redemption of shares involves a return of capital, it is prohibited under Cayman Islands law except to the extent permitted by statute. Section 37 of the Cayman Islands’ Companies Act (the Act) provides:
Key takeaways
If the agreement between a creditor and debtor refers disputes to arbitration, what limits should be placed on the creditor to pursue winding-up proceedings based on an unpaid debt under that agreement? Should a court simply stay the winding-up proceedings to allow the debt to be disputed in arbitration?
What you need to know
The decision confirms that an arbitration agreement will be upheld in the face of insolvency proceedings only if it can be shown that the petition debt is genuinely disputed on substantial grounds.
Bygge- og anlægsbranchen har i de seneste år oplevet en kraftig stigning i antallet af konkurser og toppede foreløbigt i 2023 med hele 1.282 erklærede konkurser. Da konkurserne ofte er forbundet med store tab, hvis de indtræder under et igangværende byggeri, har tendensen i stigende grad aktualiseret en belysning af de muligheder, der er for at sikre sig imod sådanne tab.
The Bankruptcy Code invalidates "ipso facto" clauses in executory contracts or unexpired leases that purport to modify or terminate the contract or lease (or the debtor's rights or obligations under the contract or lease) based solely on the debtor's financial condition or the commencement of a bankruptcy case for the debtor. It also invalidates state law, rather than a contract, that purports to alter the property interests of the debtor. A more difficult situation arises when those interests are on the outer bounds of "property of the estate."
We are happy to present the tenth issue of our e-magazine – Trilegal Quarterly Roundup.
This issue features:
• Intellectual Property Diligences from an Insolvency Lens
• A Roadmap for 100% Biomass-based Energy Solutions
In brief
On 29 February 2024, the court of appeal will hear an appeal against an order for the insolvent liquidation of a company that unsuccessfully argued, at first instance, that the petitioning debt was subject to a dispute covered by contractual agreements to arbitrate. While the interplay between insolvency and arbitration is not a new issue, the upcoming hearing will be the first time after the court of final appeal's decision in Re Guy Kwok-Hung Lam [2023] HKCFA 9 ("Guy Lam") for the court of appeal to clarify the principles.