A Practical Guide to Bankruptcy:

Part 1: A Broad Overview of Bankruptcy

‘As privileged professionals, who live by the words of the English language, lawyers have a special duty to be clear in what they say and write’[1]

When discussing any area of law, precision is essential.

Seit dem 1. Januar 2019 haben Schuldner bei Vorliegen bestimmter Voraussetzungen die Möglichkeit, mittels eines Gesuchs zu verlangen, dass eine ungerechtfertigte Betreibung auf dem Betreibungsregisterauszug nicht ersichtlich ist. In der Zwischenzeit hat das Bundesgericht erste Entscheide gefällt, welche die die Tragweite der seit 2019 in Kraft stehenden Bestimmung präzisiert.

The coronavirus pandemic posed a significant challenge to the financial health of businesses across the UK. A sector additionally at the mercy of the markets following the easing of lockdown restrictions is the energy industry, with the wholesale price of natural gas (measured on a pence per therm basis) having risen dramatically from around 50p/therm in January 2021 to over 200p/therm during the first few weeks of October 2021.

The new 2021 year brought in various changes to insolvency laws, which included the introduction of the Small Business Restructuring (SBR) process to assist small businesses in restructuring their debts. This new regime provides an opportunity for eligible small businesses which are financially distressed, but otherwise viable, to continue trading into 2021 and beyond. However, a question that we have recently been faced with is whether a company that is a corporate trustee of a trust, also known as a trustee company, is able to avail itself of the SBR process.

The Bankruptcy Protector

In the ever-churning waters of the Countryman test for determining whether a contract is executory, the United States District Court for the Middle District of Louisiana recently dipped its toe. The question before the court was whether surety bonds issued to an oil and gas company were executory. The district court, upholding the bankruptcy court below, held that they were not. An analysis of this opinion sheds light on why the surety bonds are not executory and provides lessons for both creditors and debtors, alike.

In Pharmagona Limited v Taheri,(1) the High Court refused to seal and issue a contempt application as the breach, if it had occurred, was only technical, and it was therefore inappropriate for the application to succeed.

Facts

This week’s TGIF considers a recent decision of the Federal Court where a company was found to be ‘insolvent’ for the purposes of assessing breach and termination of a contract, despite its subsequent survival and ongoing trading.

Key Takeaways

These case summaries first appeared in LexisNexis’ Insolvency Case Alerter. They represent some of the more interesting insolvency decisions to have been published recently.

This summary covers:

U.S. Bankruptcy Court for the Western District of North Carolina, October 14, 2021

Exploring the bounds of concreteness and traceability following the Supreme Court’s landmark decision in TransUnion LLC v. Ramirez, the Sixth Circuit in Krueger v. Experian, et al. recently reversed a grant of summary judgment in favor of a lender in a Fair Credit Reporting Act (FCRA) case, finding that the plaintiff had a sufficiently concrete injury to support Article III standing.