On 1 March 2019 the Court of Appeal handed down judgment in First City Monument Bank Plc v Zumax Nigeria Ltd [2019] EWCA Civ 294, a decision which will provide welcome clarity to those engaged in international banking and the financing of international trade.

SUMMARY

The Court of Appeal of England and Wales (“CA”) made a significant ruling on two matters affecting the powers and duties of directors of English companies.

It is little wonder why Andrew Tinkler’s removal from the Stobart Group (and subsequent court case) attracted so much media attention:

A real, as opposed to remote, risk of insolvency is not necessarily enough for the duties of a board of directors to switch from being owed to its shareholders to being owed to its creditors.

What should your company do if faced with a statutory demand or a winding up petition? Time is of the essence where there is a threat of formal insolvency proceedings. If a winding up petition is being threatened it must not be ignored. The consequences that can flow once a winding up petition has been advertised can be devastating, both to the company's reputation and its financial position.

We identify some of the key considerations and steps that should be taken immediately so as to reduce any damage that a winding up petition can cause.

In April 2018, the United States Supreme Court approved rule changes to both the Federal Rules of Civil Procedure (the Civil Procedure Rules) and the Federal Rules of Bankruptcy Procedure (the Bankruptcy Rules). The rule changes became effective on December 1, 2018. While the modifications are not as monumental as those made in previous years, one set of changes, focusing on electronic service, will certainly impact the day-to-day practice for bankruptcy professionals.

It looks like 2019 won't be the new start many had hoped for. With large high street retailers already teetering on the edge after a disappointing Christmas and the government still up in arms about the B word, the country's commercial real estate market is looking more and more uncertain.

Introduction

In light of the decisions made in the case of BTI 2014 LLC v Sequana SA [2019] EWCA Civ 112 (the Sequana case), consideration may need to be given to the interests of creditors when declaring a dividend. The Court of Appeal in the Sequana case concluded that the payment of an otherwise lawful dividend constituted a transaction defrauding creditors under section 423 of the UK’s Insolvency Act 1986 (IA 1986).

Background to the Sequana Case

A copy of the judgment can be found here.

Introduction 

1. The bank successfully appealed an order refusing to give or reserve judgment after hearing full submissions in the bank’s petition and instead listing the petition for hearing at the same time as two later-in-time petitions to bankrupt the debtor.

The Background

Service area / Restructuring and Insolvency

Location / British Virgin Islands

Date / February 2019

This article considers how to challenge an act, omission or decision of an office-holder.

The right to bring a challenge derives from Section 273 of the BVI Insolvency Act 2003, which provides:

A person aggrieved by an act, omission or decision of an office holder may apply to the Court and the Court may confirm, reverse or modify the act, omission or decision of the office holder.