Snapshot

The Court of Appeal’s judgment in Jervis v Pillar Denton Limited (Game Station) [2014] EWCA Civ 180 on 24 February 2014 has brought welcome clarity to when rent qualifies as an administration expense.

The Court of Appeal has ruled that:

The Pensions Regulator (TPR) has announced that it has withdrawn moral hazard proceedings against Chemtura Manufacturing UK Limited and its US parent, Chemtura Corporation. This follows an agreement being reached by Chemtura with the trustees of the Great Lakes UK Limited Pension Plan (the Plan) over its funding package.

The Court of Appeal uses common law principles to allow direct enforcement.

Summary

This briefing summarizes the recent U.S. Bankruptcy Court order establishing bar dates for creditors filing claims in relation to debts owed to them by Lehman Brothers entities in Chapter 11 bankruptcy proceedings. Specifically, this briefing discusses who must file a proof of claim, how to file the proof of claim, and the special requirements for claims in respect of derivative contracts, guarantees and Lehman program securities.

In Bridge Trustees Limited v Noel Penny, Judge Purle QC, sitting as an additional Judge of the High Court, held that the Court could use its inherent jurisdiction to permit an independent trustee to distribute surplus in a scheme that was winding-up. Under the Pensions Act 1995, an independent trustee is appointed to exercise powers otherwise conferred on the employer where an insolvency practitioner begins to act in relation to a company.

The High Court has sanctioned the Part 26A restructuring plan of E D & F Man Holdings Limited (the Plan) on which Freshfields has advised the E D & F Man Group (the Group). The Plan represents the first full-scale financial restructuring to utilise cross-class cram-down in respect of a financial creditor class and to amend articles of association. This scenario represents the paradigm use case practitioners and commentators envisaged when Part 26A was introduced in 2020.

As part of the overall scaling down of the COVID-19 support provided to UK businesses, the UK government has announced changes to the regime for winding-up petitions, with effect from 1 October – withdrawing, at least in part, some of the protections currently afforded to businesses.

Current position

On 30 April 2021, reforms to the UK’s regime governing sales in administration by way of a ‘pre-pack’ to a connected party purchaser came into force.

The centrepiece of the reforms is a new requirement for a connected party purchaser to obtain an opinion from an independent ‘evaluator’ on whether the terms of the sale are reasonable.

While the reforms add additional process points that must be navigated in relevant cases, they will bring improved transparency to an important rescue tool which has, at times, attracted warranted criticism.

In any economic downturn, there is usually an increase in the number of demands made throughout supply chains and in particular by owners / employers on project securities (e.g. for performance issues, upon termination or following insolvency) and the recent global economic slowdown caused by the coronavirus pandemic is no different.

Last month, the German Federal Ministry of Justice published draft legislation that could fundamentally change the restructuring landscape in Germany.

An essential part of the law is the introduction of a corporate stabilisation and restructuring regime, which establishes a comprehensive legal framework for non-consensual out-of-court restructurings in Germany on the basis of the EU's 2019 restructuring directive.