Following last weeks’ report from the Banking Standards Commission in which three former senior executives of HBOS were heavily criticised thoughts have turned to whether or not there is enough evidence for the executives to have disqualification proceedings brought against them. The report named the three executives responsible, and said that the bank, having run up £47bn losses in bad loans, would have gone bust even if the 2008 financial crisis had not happened.

How can a director be disqualified?

You are busy people.  There is too much information. To try to help you identify the issues that are most important to you, we present a round-up of ten of the most significant cases and events in 2011, including Supreme Court decisions on contractual interpretation, the removal of expert witness immunity and the status of arbitrators, together with the coming into force of the Bribery Act 2010 and the new ICC Rules.

Mr Justice Zacaroli has handed down his judgment in Carroway Guildford (Nominee A) Limited and 18 others and (1) Regis UK Limited, (2) Edward Williams (as Joint Supervisor of Regis UK Ltd) and (3) Christine Mary Laverty (as Joint Supervisor of Regis UK Ltd) [2021] EWHC 1294 (Ch) following his decision in the New Look challenge last week.

Summary

InTelnic Ltd v Knipp Medien und Kommunikation GmbH [2020] EWHC 2075 (Ch), Sir Geoffrey Vos sitting in the English High Court ruled that where a debt is governed by an arbitration agreement, it is appropriate for the Court to stay or dismiss a winding up petition without investigating whether the debt is disputed in good faith and on substantial grounds.

This case provides guidance on the high threshold a creditor will have to cross in order to be able to present a winding up petition for sums due under an agreement with an arbitration clause.

In accordance with the resolution adopted by the seven-judge panel of the Supreme Court dated 20 November 2019, case file no. III CZP 3/19, it is not admissible to stipulate liquidated damages in the case of rescinding an agreement due to the failure to perform an obligation of a pecuniary nature.

Following an expedited trial, the High Court has rejected an application brought by a group of landlords known as the Combined Property Control Group (“CPC”) to challenge the company voluntary arrangement (“CVA”) proposed by Debenhams Retail Limited (“Debenhams”).

CPC challenged the CVA on five grounds. The judge in the case, Mr Justice Norris, held that four of the five grounds failed and directed certain “Forfeiture Restraint Provisions” be removed from the CVA as a result of the fifth.

A recent TCC decision has concluded that the contractor insolvency provisions of the JCT form continue to apply after a termination by the contractor for repudiation. This conclusion may give rise to surprising results and potentially allow an employer to claim from the contractor additional amounts incurred in completing the works with a third party even after termination for the employer’s own default and/or repudiation.

Administrators can be validly appointed to a company by the holder of a floating charge which was given by the company in breach of a negative pledge in favour of an existing secured creditor and even if, both at the time of the purported creation of that floating charge and on the day of the purported appointment of administrators, the company had no assets which were the subject of the floating charge.

Introduction:

The Court of Justice of the European Union has ruled that a provision of German law falls within the scope of Article 4 of the EC Regulation on Insolvency Proceedings, thereby paving the way for a German court to require a director of an English incorporated company to make payments under German law where the company has been placed into insolvency proceedings in Germany. 

On 9 April the Polish Parliament adopted a bill implementing the so-called “second chance” policy for businesses, pursued at the EU level.

The Act introduces a clear separation between restructuring proceedings and bankruptcy proceedings. As the latter are commonly perceived as stigmatising, the initiation of bankruptcy can hinder successful restructuring. The new Act introduces four new types of restructuring proceedings, i.e.: