Christmas came early for landlords last year when the High Court handed down its decision in this case. The court had to consider the circumstances in which a tenant's administrators are obliged to pay rent as an expense of the administration, thereby giving the landlord priority over other unsecured creditors.

Where "prejudice" is suffered by a creditor or contributory, the court can order a compulsory liquidation despite a voluntary liquidation having already been entered into.

The insolvency of UK insurance companies is, fortunately, a fairly rare event. Even in the current difficult times - and despite speculation about the solvency of some insurers - we have yet to see a UK insurance company actually go into liquidation.

Some of the customers of Farepak, the failed Christmas hamper company that went into liquidation with BDO Stoy Hayward some three years ago, will apparently soon receive their first dividend cheques out of the insolvency. Perhaps even in time for Christmas 2009!

Re Stanford International Bank Limited and others [2009] EWHC 1441 (Ch) provides answers to key questions on the UNCITRAL Model Law on cross-border insolvency. What will courts recognise as a “foreign proceeding”? What types of insolvency practitioners will qualify as “foreign representatives”? Is a company’s “centre of main interests” (COMI) always in the country of its registered office? Linda Ralli considers the practical implications for banks which have lent to foreign companies where they are looking to enforce in England.

Facts

The High Court in England has made an interesting decision in the case of ED Games Limited. A director of that company procured that it did not pay VAT for a period prior to its liquidation and in that period, the net deficit on the company's balance sheet increased. The High Court has held that the director could be held personally liable for the increase in such net deficit.

The making of a bankruptcy order alone will not deprive a judgment creditor of a final charging order where it is obtained before the bankruptcy order is made.

In the current climate, both landlords and tenants could be forgiven for wondering what would happen if the other became a victim of the recession. For both parties, a rent deposit deed can provide some comfort. Such a deed would mean the landlord has immediate access to cold hard cash if the tenant fails to pay the rent, while a struggling tenant may get valuable breathing space before the landlord turns to other remedies.  

A question facing many landlords is whether, when a tenant company faces insolvency and shows no intention of continuing to trade from the premises, they should take back the property and seek to relet it?

There are several key issues here, including:

• rates liability
• mitigating losses
• ability to recover from third parties and former tenants.

A landlord's decision has often turned on the type of insolvency faced by the tenant.

If a liquidator disclaims the lease:

In the matter of Bernard L Madoff Investment Securities LLC [2009] EWHC 442 (Ch), Mr Justice Lewison granted an application for the transfer of personal data in the possession of the joint provisional liquidators of a UK subsidiary to the trustee in bankruptcy of its parent company in the US, Bernard L Madoff Investment Securities LLC. The application was granted on the basis that it was necessary for reasons of substantial public interest.