There has been significant focus recently of the effect of tenants unable to operate their business. Unfortunately, we are seeing an increase in tenant liquidation during this downturn in the economy.

As a landlord, this can have a significant impact on enforcing your legal rights.

In particular:

Ozner Water International Holding Limited (In Liquidation) [2022] HKCFI 363 (date of decision: 27 January 2022)

Hong Kong Fresh Water International Group Limited (In Liquidation) [2022] HKCFI 924 (date of decision: 6 April 2022)

Introduction

Practitioners will be pleased to know that the NSW Supreme Court has provided clarity on the order of priority for employee debts and secured creditor claims.

The matter, In the matter of Spitfire Corporation Limited (in liquidation) and Aspirio Pty Ltd (in liquidation), involved the liquidators of two insolvent companies (Spitfire Corporation Ltd and Aspirio Pty Ltd) seeking directions under s 90-15 of the Insolvency Practice Schedule (Corporations).

Justice Stephen G. Breyer is set to retire from the U.S. Supreme Court in a few months.

But he’s not easing into retirement.

Instead, he’s out there swinging—fighting for his beliefs: trying to instruct / persuade current and future jurists on how the law should be applied.

Justice Breyer’s latest punch is a lone-dissent, against an eight-Justice majority, dated March 31, 2022. In this dissent, Justice Breyer explains his doctrine of statutory interpretation.

The Breyer Doctrine

Justice Breyer’s doctrine goes like this:

A Bírósági Határozatok Gyűjteményében közzétett Gfv.VII.30.365/2020/5. számú határozatában a Kúria arra a következtetésre jutott, hogy az adós és a hitelező közötti szerződés felszámoló általi, Cstv. 47. § (1) bekezdés szerinti felmondása nem jogellenes, ebből következően az adóssal szemben a szerződés alapján a felmondás tényére tekintettel kártérítési igény nem érvényesíthető. A kártérítési felelősség megállapítására ugyanis jogellenes magatartás hiányában nem kerülhet sor.

The common law imposes on all company officers (directors and secretaries), fiduciary duties and a duty of skill, care and diligence. The Companies Act 1981 (the "Act") codifies certain of the common law duties (but is not exhaustive), such that officers' duties are governed by both common law and statute.

Where the key asset of a technology start up is a potential entitlement to an R&D tax refund, the Spitfire decision provides important clarity for financiers of such businesses, as well as for liquidators (and employees) of those businesses which fail.  

Insolvency practitioners will welcome the confirmation that they cannot be expected to be aware of same degree of information as if company was still trading

In the recent Court of Appeal case of Re Ipagoo LLP, the court provided welcome clarity on the status of e-money holders’ claims under the Electronic Money Regulations 2011 (EMR). In brief, the Court of Appeal held that the EMR do not impose a statutory trust in respect of funds received from e-money holders. The court confirmed, however, that e-money holders will still enjoy priority status in respect of their e-money creditor claims (crucially) whether or not their funds have been duly segregated from the general pool of assets, as required under the EMR.

The Regulation on the Procedure for Sales to be Made in the Electronic Environment pursuant to the Enforcement and Bankruptcy Law, and the Regulation Amending the Enforcement and Bankruptcy Law Regulation (“Regulations”) were published in Official Gazette dated 8 March 2022 and numbered 31772, entering into force on the same day.