The Court of Appeal (Singh, Males, and Popplewell LJJ) has delivered an important judgment on the interpretation of s.423 of the Insolvency Act 1986 in Invest Bank PSC v El-Husseini[2023] EWCA Civ 555.

Hugh Miall and James Fennemore acted for the successful claimant beneficiaries in an important decision concerning insolvent trusts and powers exercised for an improper purpose.

Floating charges are common features of finance transactions both in Scotland and in England, and share some characteristics, but these securities have different origins (the Scottish floating charge is a creation of statute while the English floating charge derives from common law) and other key differences which we outline below.

In Denaxe Limited v Cooper & Rubin, the Court of Appeal has recently considered the important issue of immunity from suit against a party who has previously sought the Court’s approval for a particular course of action. This is commonly utilised by trustees (under CPR 64) and insolvency practitioners (for example under CPR 69 and Schedule B1 of the Insolvency Act 1986) when faced with difficult questions concerning entitlements and distributions to different classes of beneficiary or creditor.

It is worthwhile for creditors to take part in litigation even if the outcome could go against them. This way, they can help prevent the court from issuing rulings sought by colluding debtors and their allies.

Most landlords seek advice prior to entering a commercial lease.

But, as the cautionary tales in this article suggest, if the tenant goes into administration or liquidation, landlords would be wise to seek specialist advice. The lesson is simple: a landlord should not lightly assume that the appointment of an administrator or liquidator implies the end of the lease or a right to re-enter the premises.

“Were Congress to . . . intervene and expand § 524(g) beyond asbestos cases, bankruptcy would become a more suitable alternative for resolving mass tort cases. Until then, such cases will likely remain problematic under the Code in the face of creditor opposition.”

In a decision likely to have a knock-on effect for future fraudulent transfer defense and valuation litigation, the Delaware bankruptcy court recently ruled that the price agreed in the sale of an oil and gas company closed by market participants represents the reasonably equivalent value for the assets being sold and is more reliable evidence of value than expert testimony prepared for the purposes of litigation.

Key Points

A “pre-pack” is a sale of all or part of a distressed company’s business or assets, negotiated before the company enters a formal insolvency process and executed by the appointed insolvency practitioner immediately after the insolvency process begins.