In Sian Participation v. Halimeda International [2024] UKPC 16, Lords Briggs and Hamblen, delivering judgment on behalf of the Board, endorsed the traditional approach to winding-up petitions. Their Lordships confirmed that a debtor’s duty to show that the debt is genuinely disputed on substantial grounds (“Triable Issue Standard”) remains undiluted even if the contract from which the debt arose contains an arbitration clause.
ACT WHICH ENHANCES PROTECTION FOR EMPLOYEES AFFECTED BY INSOLVENCY NOW LAW
An important decision on the “boundary issue” between arbitration and insolvency came out this week. One that has troubled me in the past.
Question: Can you wind up a company for a debt due under a contract containing an arbitration agreement or do you have to go through arbitration first? Up until now, you had to get an arbitral award first, regardless of whether the debt was disputed.
But now, unless the debt is disputed on genuine and substantial grounds, you can press ahead with applying for a winder. So said the Privy Council today.
Insolvency set-off is an important quasi-security device for parties engaging in trade or other dealings with a company. It enables mutual debts owed between a party and a company to be set off against each other if the company goes into judicial management or liquidation.
A guarantor’s rights of subrogation are provided for in Sections 140 and 141 of the Indian Contract Act, 1872 (“ICA”). These rights allow a guarantor to step into the shoes of the creditor, upon fulfilling the debtor’s payment obligations to the creditor. This means that the guarantor assumes all the rights including the security that the creditor enjoyed against the principal debtor.
Introduction
The Supreme Court’s landmark decision in Harrington v. Purdue Pharma L.P. – holding that the Bankruptcy Code does not authorize the release of third-party claims against non-debtors in a reorganization plan without the consent of the affected claimants – will have a lasting impact on mass tort bankruptcy cases and likely nullifies one of the primary benefits of the so-called “Texas Two-Step” strategy: obtaining third-party releases of the debtor entity’s non-debtor affiliates.
Teacher Retirement System of Texas plans to reduce its private equity target allocation to 12% from a current exposure of 16.7% starting in October. The planned reduction, which may be implemented over a number of years. For now, the change in target allocation likely means reduced new commitments, while some of the rebalancing could be accomplished by fund AUM growth.
In the matter of BRS Refineries vs. . Mr. Supriyo Kumar Chaudhari, the NCLAT New Delhi upheld the order passed by the Adjudicating Authority (National Company Law Tribunal), Allahabad Bench, rejecting an appeal filed by BRS Refineries. The earlier appeal had challenged the action of the liquidator for JVL Agro Industries Ltd., to forfeit the earnest money deposit (EMD) of Rs. 96 lakhs pursuant to the e-auction of the assets of JVL Agro Industries Ltd.
Justice Sonia Sotomayor delivered the Supreme Court’s unanimous opinion in Truck Insurance Exchange v. Kaiser Gypsum Company, Inc., et al. (Case No. 22-1079) (“Kaiser Gypsum”). Reversing the opinion of the United States Court of Appeals for the Fourth Circuit in In re Kaiser Gypsum Co., Inc., 60 F.4th 73 (4th Cir.