A number of changes have been made to insolvency procedure to remove various discrepancies and controversial practices:

On 16 March 2022, the Slovak Parliament approved the anticipated new act on solving threatened bankruptcy (the Act) and also amended related legislative documents. It implements the Directive (EU) 2019/1023 on preventive restructuring, whose implementation was postponed by one year to 17 July 2022 due to the COVID-19 pandemic. The Act aims to reform insolvency in Slovakia and make preventive mechanisms effective enough to reduce the number of bankruptcies.

To whom does the Act apply?

Despite the scale of the pandemic and resulting build-up of Covid related rent arrears, currently estimated at around £4.5bn, business restructuring has been relatively muted. This is partly explained by the moratorium on forfeiture and other restrictions on landlords’ remedies, combined with unprecedented government financial support for struggling businesses.

But rent arrears cannot be pushed down the track indefinitely. As restrictions are eased and focus turns to tackling this debt, business restructuring activity will no doubt intensify.

Last week, in Re a Company (Application to Restrain Advertisement) [2020] EWHC 1551 (Ch) the High Court restrained the advertisement of a winding up petition on grounds of the impending changes to insolvency legislation, which are intended to have a retrospective effect.

Last September we reported on the Court’s decision on the landlords’ challenge to the Debenhams CVA on grounds of unfair prejudice and material irregularity, in respect of which the landlords have now successfully obtained permission to appeal on various grounds (see below).

The Chancellor announced in his budget that the Crown is to be re-instated as a preferential creditor in insolvency, reversing the changes brought in by The Enterprise Act 2002.

Earlier today, the Court of Appeal handed down a significant judgment dealing with the adequacy of standard form after-the-event (“ATE”) insurance to defeat an application for security for costs.

In an unanimous ruling, the Court of Appeal overturned the High Court’s judgment on the defendants’ security for costs applications in Premier Motorauctions Limited (in liquidation), Premier Motorauctions Leeds Limited (in liquidation) v PricewaterhouseCoopers LLP and Lloyds Bank plc [2016] EWHC 2610 (Ch).

Summary

The High Court recently handed down the judgment in Ralls Builders Ltd (In Liquidation), Re [2016] EWHC 1812 (Ch). It was held that liquidators and administrators are not able to recover their own costs and expenses of investigating a wrongful trading claim from the directors of a company, even following a finding of wrongful trading under section 214 Insolvency Act 1986.

Background

Introduction:

Wide ranging changes to insolvency law will come into force on 1 October 2015 that will have repercussions for insolvency practitioners, directors and D&O insurers alike. One of the more significant - and controversial - changes allows office holders in insolvency proceedings to assign claims deriving from those proceedings to third parties. The implications of this are potentially far reaching and are discussed below.

New powers of assignment

Introduction