Can an examiner be appointed to a company which had previously entered into a standstill agreement with one or more of its creditors? In Re KH Kitty Hall Holdings Limited [2017] IECA 247 the Court of Appeal answered "yes".
Does a petitioner have to show that it is unmotivated by self-interest? "No" was the court's answer.
Two significant decisions in relation to personal insolvency applications were made recently in the Dublin Circuit Court and the High Court. The decisions relate to “locus standi”, which means who has the right to bring an application before a court.
Circuit Court case
In Wingview Limited t/a Elphin Public House v Ennis Property Finance DAC the High Court granted an interlocutory injunction prohibiting the defendant from appointing a receiver over Elphin Public House, the Dublin pub which featured in the film "The Van" (1996).
Introduction
The Companies (Accounting) Act 2017 (the ‘Act’) provides welcome clarity on the position of crystallised floating charge holders in relation to their priority over preferential creditors.
The Court of Appeal has helpfully confirmed that a judgment creditor can seek an order appointing a receiver by way of equitable execution where:
- the debtor holds a legal or equitable interest in property; and
- execution against the property is not available at law by one of the usual methods, for instance via the sheriff or by a garnishee order.
There was previously doubt as to whether such a receiver could be appointed where the debtor held a legal, as opposed to an equitable interest, in property.
Introduction
On 29 June 2017 the High Court made an order for costs against the three former directors of Custom House Capital (the “Company”) having already disqualified them from acting as directors for periods in excess of ten years. The judgment was unusual because the order for costs was not just in relation to the legal costs but also for the very significant investigative costs of the Official Liquidator.
Background
Further evidence that Ireland is emerging from economic recession can be seen in the publication of the Courts Service Annual Report 2016 (the Report). An examination of the Report’s figures relating to debt collection activity shows a continuing decline in creditor litigation and enforcement. The number of default judgments marked in 2016 across the District, Circuit and High Courts shows a fall to 10,475 from 14,204 during the previous year. This represents almost an 80% drop on the equivalent number of such judgments marked in 2010.
Introduction
With the commencement of the Companies Accounting Act 2017 (“2017 Act”) on 9 June 2017, the priority of charges in liquidations has been dramatically altered.
Judicial Development
The High Court recently rejected an appeal by KBC Bank Ireland (“KBC”) to write down a portion of a debtor couple’s mortgage due to the uncertainty in the ability of the debtors to repay the warehousing portion of the loan. The Personal Insolvency Arrangement (“PIA”) which had been approved by the Circuit Court was upheld.
In this regular briefing, we summarise recent cases, developments and trends relevant to the ongoing efforts to resolve the mortgage arrears crisis.
CASELAW
Personal Insolvency
A series of recent cases have shed further light on factors that a Court will take into account when hearing a debtor’s appeal of a secured creditor’s decision to reject a proposed Personal Insolvency Arrangement (PIA) under the Personal Insolvency Act 2012 (the 2012 Act).