An application to admit witness evidence outside the directions timetable should be treated like an application for relief from sanctions under CPR 3.9 according to the High Court in Wolf Rock (Cornwall) Ltd v Langhelle.
Facts
Can a company file a notice of intention to appoint an administrator (NOI) if administration is just one of a number of potential options being explored for rescuing the company?
In Smailes and another v McNally and another[i]the High Court refused the claimant's application for relief from sanctions, finding the claimant's failure in respect of its disclosure obligations under the relevant provisions of the Civil Procedure Rules (CPR 31) amounted to a significant and serious breach of an "unless order".
The UK’s Insolvency Act 1986 sets out in s.123 various tests to determine whether a company should be deemed unable to pay its debts. The relevance of these tests to distressed companies is obvious: deciding as they do when it is appropriate to seek an administration order or present a winding up petition. They also help determine directors’ duties, antecedent transactions and issues such as wrongful and fraudulent trading.
- Decision will be welcomed by insurers
The Scottish Appeal Court has allowed the appeal by Scottish Lion Insurance against the judgment of Lord Glennie on whether it would ever be fair for a court to sanction a solvent scheme in the face of creditor opposition, says City law firm Reynolds Porter Chamberlain LLP (RPC).
Applying for permission to advance fresh evidence on appeal is a tricky application, which has had varying degrees of success in the courts. Zheng Yougxiong v Gate Ventures Plc(1) is a useful example of the application of the criteria, albeit in the context of insolvency proceedings.
Background
Mr Zheng was a shareholder in, and creditor of, Gate Ventures plc. He sought and failed to obtain an administration order against Gate Ventures plc on the basis of a £2.5 million debt (the First Application).
Winding up petition struck out as an abuse of process where the court was not satisfied that the petitioner was a creditor.
On 22 April 2015 the Supreme Court handed down its judgment in the case of Jetivia SA and another v Bilta (UK) Ltd (in liquidation) and others [2015] UKSC 23, which was heard in October last year. In short it decided that: 1) defendant directors cannot raise illegality as a defence to a claim by a company where the directors themselves acted wrongfully; and 2) a claim in fraudulent trading under Section 213 of the Insolvency Act 1986 (Section 213)has extra-territorial effect.
Background
The UK Supreme Court judgment in the conjoined cases of Rubin and another v Eurofinance SA and others and New Cap Reinsurance Corporation (in Liquidation) and another v AE Grant and others [2012] UKSC 46, which provides vital clarification on the effect of foreign insolvency judgments on the UK courts.
Background & Court of Appeal
The case of Goldacre v Nortel, decided in December, has clarified the circumstances in which an administrator is liable to pay rent under a lease as an expense of an administration. If rent is an expense of the administration, the landlord will almost certainly be paid in full for as long as the administrator uses the property. If it is not such an expense, the landlord will be an unsecured creditor who will be lucky to receive a few pence in the pound.