The US Court of Appeals for the Eighth Circuit affirmed a district court’s ruling that there was no actionable infringement where an uncompleted building sold under the authority of a bankruptcy court was later completed. Cornice & Rose International, LLC v. Four Keys, LLC et al., Case No. 22-1976 (8th Cir. Aug. 11, 2023) (Loken, Shepard, Kelly, JJ.) (per curiam). The Court explained that the architectural copyright claims were precluded by the bankruptcy court’s order approving the sale.

The Supreme Court has today released its decision in Yan v Mainzeal Property and Construction Limited (in liquidation) [1] (Mainzeal), upholding the Court of Appeal’s finding that Mainzeal’s directors were liable for insolvent trading and ordering Mainzeal’s directors to pay $39.8 million plus interest, with the liability of three of the four directors capped at $6.6 million plus interest.

MinterEllisonRuddWatts acted for the liquidators in the Mainzeal litigation.

Significance of decision

The long awaited Supreme Court decision on the Mainzeal appeal is out, addressing issues of “fundamental importance to the business community”. The judgment essentially upheld the factual findings of the lower Courts that the Mainzeal directors had breached directors’ duties under the Companies Act 1993, and it provides important clarity of the legal principles - and practical steps - that are relevant to directors of companies facing financial difficulties.

Important learnings

Key Takeaways

In welcome news for insolvency practitioners, the Supreme Court has limited the circumstances in which a dissatisfied bankrupt will have standing to challenge a trustee in bankruptcy's decisions or actions under section 303(1) of the Insolvency Act 1986 (Act), to those where there is likely to be a surplus in the bankruptcy estate (subject to only very limited exceptions). The Supreme Court acknowledged that, while this decision is about bankruptcy, the reasoning will also apply to challenges to liquidators' decisions under section 168(5) of the Act.

In welcome news for insolvency practitioners, the Supreme Court has limited the circumstances in which a dissatisfied bankrupt will have standing to challenge a trustee in bankruptcy's decisions or actions under section 303(1) of the Insolvency Act 1986 (Act), to those where there is likely to be a surplus in the bankruptcy estate (subject to only very limited exceptions). The Supreme Court acknowledged that, while this decision is about bankruptcy, the reasoning will also apply to challenges to liquidators' decisions under section 168(5) of the Act.

The stakes in the appeal from a recent case in Alberta,  Qualex-Landmark Towers  Inc  v  12-10  Capital Corp (“Qualex”) are rising with the recent decision of the Court of Appeal of Alberta granting leave to intervene to the Canadian Bankers Association [Qualex-Landmark Towers Inc v 12-10 Capital Corp, 2023 ABCA 177].  The Canadian Bankers Association sought leave to intervene on the basis that the decision in Qualex creates significant uncertainty for secured lending, particularly where the borrower may have environmental remediat

Substitution first, standing later- a decision of Chief ICC Judge Briggs regarding supporting creditors and substituting as petitioner

“(b) Duties.—The [Subchapter V] trustee shall— . . . (7)facilitatethe development of a consensual plan of reorganization.”

• From 11 U.S.C § 1183(b)(7)(emphasis added).

Facilitation is, by statute, a duty of every Subchapter V trustee—something a Subchapter V trustee must do. But the nature and boundaries of the facilitation role have always been fuzzy and, therefore, misunderstood.

My purpose in this multi-part series is to provide observations on the facilitation role.

“Learn something new every day,” is a well-worn adage.

And it’s mostly true (I only question giving a literal meaning to the “every day” part).

Nevertheless, I’m embarrassed to acknowledge learning only recently of the existence of a noteworthy, bankruptcy-related statute: 28 U.S.C. § 959(a). Such statute reads in part (emphasis added):

When do amounts owed to a company constitute ‘circulating assets’ and how should they be distributed? This crucial question has not always been answered predictably in recent cases. The Court of Appeal’s decision in Resilient Investment Group Pty Ltd v Barnet and Hodgkinson as liquidators of Spitfire Corporation Limited (in liq) [2023] NSWCA 118 has provided a framework for navigating the relevant principles in the context of a priority dispute over R&D tax refunds.

Key takeaways