On 6 April 2017, together with the new Insolvency Rules (England and Wales) 2016, the Investment Bank (Amendment of Definition) and Special Administration (Amendment) Regulations 2017 (the “Regulations”) will come into force.

These regulations follow an independent review of the special administration regime, undertaken by Peter Bloxham during 2013, assessing the success of the special administration regime and making recommendations of possible changes that may improve the operation and robustness of the regime.

Changes to the Insolvency Act 1986 ("Act")

SBEEA 2015 makes a host of supplemental amendments to the Act, the general effect of which is remove references to creditors' meetings and replace them with the alternative decision processes.

As a consequence:

This article looks at the forthcoming pre-action protocol for debt claims in its current form, with an anticipated implementation date around October this year.

There might be further changes ahead, and a shift in the implementation timetable, so please watch this space for further updates.

In an important Court of Appeal (CoA) decision handed down on 1 March 2017, the CoA has clarified the position for banks, lenders and insolvency practitioners regarding realisation of assets after certificates of completion have been issued in individual voluntary arrangements (IVAs).

The High Court has held that a bank owed a duty of care to its customer when on notice that an agent acting for the customer was misusing his authority. In the case of Singularis Holdings Limited (in Official Liquidation) v Daiwa Capital Markets Europe Limited [2017] EWHC 257 (Ch), a bank was liable in negligence to its customer since it was on notice that its customer was at risk of being defrauded by its director but failed to stop payments made for the purpose of misappropriating funds of the company.

The Facts

It is standard market terms for a lender to have the express right to transfer its loan. In particular, English law governed syndicated loan documents will usually incorporate the Loan Market Association (LMA) wording (or similar) to this effect. Interestingly, the Court of Appeal has recently had to consider the scope for implying terms into such LMA-style language and whether to restrict a lender’s right to market the sale of the loan under those standard terms.

Overview

In IBRC v Camden[1], the Court of Appeal held that a lender's express contractual power to market a loan was not subject to an implied limitation that doing so should not interfere with the borrower's ability to obtain the best price for the assets securing the loan. In so doing, the Court of Appeal reaffirmed the "cardinal rule" that an implied term must not contradict any express term of the agreement.

Background

The question of who is entitled to payment of compensation for PPI where a debtor has been discharged from his/her Protected Trust Deed (PTD) had given rise to conflicting judicial decisions in Scotland. In our previous article, we highlighted the uncertainty created following the decision of Sheriff Reid in the case ofDonnelly v The Royal Bank of Scotland (Donnelly) and the decision of Lord Jones in Dooneen Limited, t/a Mcginnes Associates and Douglas Davidson v David Mond (Dooneen).

Summary

The insolvency legislation contains an unusual provision pursuant to section 375(1) of the Insolvency Act 1986 enabling the court to review its own decision. The issue in this case was whether the High Court could review its own decision where that decision was an appeal of a bankruptcy order made by a District Judge in the County Court.

The Facts

The Investment Bank Special Administration Regime (SAR) was introduced in 2011 in response to difficulties faced in the Lehman Brothers administration. Following a review of the regime by Peter Bloxham in 2014, and a Government consultation in 2016, the Treasury has introduced draft regulations to improve the regime - The Investment Bank (Amendment of Definition) and Special Administration (Amendment) Regulations 2017.