As noted in our prior Alerts, the Coronavirus Aid, Relief and Economic Security Act (“CARES Act”), which became law March 27, 2020, included various COVID-19 pandemic-related bankruptcy relief provisions which sunsetted on Saturday, March 27, 2021, but were extended by the “COVID-19 Bankruptcy Relief Extension Act of 2021” (“2021 Extension Act”) through March 27, 2022. By the President’s June 21, 2022, signature of the Bankruptcy Threshold Adjustment and Technical Corrections Act (the “BTATC Act”), Pub. L. No. 117-151, ___ Stat.

In a decision rendered on June 6, 2022, Justice Sotomayor authored the Supreme Court’s unanimous decision in the case Siegel v. Fitzgerald, holding that a statutory increase in United States Trustee’s fees violated the “uniformity” requirement of the Bankruptcy Clause set forth in Article I, § 7, cl. 4 of the United States Constitution, which empowers Congress to establish “uniform Laws on the subject of Bankruptcies throughout the United States.”1  

In a recent decision, the Ontario Court of Appeal held that the sale proceeds of a property held in trust can be applied to a beneficiary’s bankruptcy obligations.

Overview

King & Ors v Kings Solutions Group Ltd & Ors [2022] EWHC 1099 (Ch)

Background

This appeal arose in the context of long-running and complex dispute between the shareholders of Kings Solutions Group Limited (‘the Company’).

A foreign (non-U.S.) company can be dragged unwillingly into a U.S. bankruptcy case if the bankruptcy court has “personal jurisdiction” over the company.

A foreign (non-U.S.) company can be dragged unwillingly into a U.S. bankruptcy case if the bankruptcy court has “personal jurisdiction” over the company.

We consider the implications for office-holder claimants of the recent case ofKelmanson v Gallagher & De Weyer [2022] EWHC 395 (Ch).

The case raises interesting points of practice for insolvency practitioners: a director consciously trying to evade or 'game' the statute won't work to prevent office holder recovery, but a sincerely held but mistaken belief on the director's part as to what was being done doing could.

KEY POINTS:

The Insolvency and Bankruptcy Code, 2016 (Code) was enacted to consolidate and amend the laws relating to reorganization and insolvency resolution of corporate persons.

The Bankruptcy Protector