On 6 June 2013, the Court of Appeal reversed the High Court’s decision in The Trustees of the Olympic Airlines SA Pension & Life Insurance Scheme v Olympic Airlines SA from May 2012.
Summary
The Court of Appeal’s judgment in The Trustees of the Olympic Airlines SA Pension & Life Insurance Scheme v Olympic Airlines SA [2013] EWCA Civ 643 has clarified what is required to fall within the definition of an ‘establishment’ for the purposes of the EC Insolvency Regulation (the Insolvency Regulation).
The Court of Appeal decision in the Nortel case upheld the High Court ruling that FSD/CN liability is an expense of the administration and therefore ranks ahead of administrators' remuneration, floating charges and unsecured creditors. Much of the press coverage which has followed in the immediate aftermath seems to have assumed that the decision is a victory for "good" pensioners over the "bad" banks.
The effect of the CA decision
We reported on the High Court case of BNY Corporate Trustee Services Limited v Eurosail in August 2010 and last week's Court of Appeal decision provides further important guidance on the interpretation of the balance sheet insolvency.
The Court of Appeal uses common law principles to allow direct enforcement.
In a much anticipated judgment the Court of Appeal has clarified the position regarding the anti-deprivation rule.
Last week the Court of Appeal of England and Wales handed down its decision in four appeals which raise a number of questions of construction in relation to derivatives in the form of interest rate swaps and forward freight agreements documented under the International Swaps and Derivatives Association Inc. Master Agreement (the “ISDA Master Agreement”).1 In particular, the decision focuses on the interpretation of section 2(a)(iii) of the ISDA Master Agreement.
Key Points
On September 21, 2010, the United States District Court for the Southern District of New York granted BNY Corporate Trustee Services Limited leave to appeal a decision of the Bankruptcy Court in the Lehman Brothers bankruptcy case.1 The Bankruptcy Court held that a key provision of certain transaction documents constituted an unenforceable ipso facto clause. The District Court granted leave to appeal the Bankruptcy Court decision even though it was interlocutory.
To avoid an asset reverting to a bankrupt after the end of his period of bankruptcy, the asset must be realised. An assignment of a beneficial interest for a future price does not amount to a realisation.