The year 2020 in bankruptcy law started with an eye on increasing the ability of small businesses to utilize the Chapter 11 process in a more efficient and less expensive way, which lead to a record number of commercial filings, a reduction in consumer filings, and a test of the bankruptcy system.
SBRA aka Subchapter V
The Australian government has taken swift action to enact new legislation that significantly changes the insolvency laws relevant to all business as a result of the ongoing developments related to COVID-19
2020 ha sido un año atípico. La alerta sanitaria mundial provocada por la expansión del COVID-19 y la consecuente declaración del estado de alarma en España en marzo de 2020 llevaron a una vorágine legislativa sin precedentes. En este contexto, las empresas se encuentran inmersas en un escenario incierto en el que la toma de decisiones juega un papel clave para la viabilidad futura del negocio.
In sophisticated real estate financing transactions, most prudent lenders attempt to deter borrowers from filing for bankruptcy before loans are paid in full by providing in loan documents that such a filing constitutes an event of default. Many lenders will insist that their borrowers remain “bankruptcy remote” in the form of a so-called “single asset real estate” entity during the term of the loan.
The High Court has recently struck out proceedings against a defaulting debtor where the bank made a unilateral commercial decision to delay to allow her co-debtor to recover financially so increasing its prospect of recovery.
Background
In Bank of Ireland v Wilson,1 the bank commenced summary proceedings against the defaulting debtors in 2012. The debtors, who were jointly and severally liable on the debt, had been in a relationship but were now estranged.
In a small victory for landlords of bankrupt tenants, the Bankruptcy Court for the Southern District of Texas has ruled that the Chuck E. Cheese parent company may not use its bankruptcy filing to avoid paying its rent.
The United States Congress revived the age-old tradition of passing a lame-duck Christmas Tree appropriations bill to fund the government and provide a second wave of much-needed COVID-19 relief legislation.[1] The nearly 5,600-page bill includes temporary alterations to the Bankruptcy Code to help thos
The Supreme Court has held that transfer of winding up proceedings from High Court to NCLT on application of financial creditor not party to proceedings before Court is permissible.
Observing that the proceedings for winding up of a company are actually proceedings in rem to which the entire body of creditors is a party, the Court held that the words ‘party or parties’ appearing in 5th proviso to Section 434(1)(c) of the Companies Act, 2013 would take within its fold any creditor of the company in liquidation.
One of the big decisions to come out of 2020 was the Supreme Court’s judgment in Bresco Electrical Services Ltd v. Michael J Lonsdale (Electrical) Ltd [2020] UKSC 25 in which it was held an insolvent party can adjudicate a dispute.
However, the Supreme Court went on to say that an adjudicator’s decision obtained by an insolvent party may not be enforced because of the insolvency: that was something the Technology and Construction Court has to decide on a case by case basis in enforcement proceedings.
So what happened next?
