The recent case of 365 Business Finance Ltd v Bellagio Hospitality WB Ltd is a reminder of the need to act quickly when enforcing a Judgment.

Insolvency in the construction industry is not just isolated to contractors, sub-contractors and consultants. Industry and economic pressures can affect all parties, including at times employers, therefore it is equally important for contractors to carry out due diligence when bidding for projects and to consider contractual mechanisms that can be put in place to protect against non-payment by the employer and insolvency risks.

Construction litigation is no stranger to insolvency, including insolvent claimants. This is also the case for adjudication, a fast and commercially driven form of dispute resolution for the construction industry. However, there has been considerable uncertainty as to the enforceability of adjudicators’ awards where a claimant is insolvent and receives a favourable decision. Recent cases have shed some light on this issue and have started to untangle the statutory difficulties when insolvency meets adjudication.

Summary and Key Takeaways

Insolvency in the construction industry is unfortunately never too far away and it would be surprising if anyone, at least indirectly, who is reading this article has not been affected.

In June 2019 the Government announced a plan to introduce a new “breathing space” scheme to protect individuals and families struggling with problem debt and to give those individuals and families extra help and time to get their finances under control.

The Pension Schemes Bill 2019 is causing a marked degree of consternation in the restructuring community. The proposed legislation introduces new offences that can be prosecuted in the criminal courts and further moral hazard powers that are likely to significantly reduce the directors’ and insolvency practitioners’ ability to provide commercial and creative solutions to creditors of financially stressed companies.

At clause 107, the Bill introduces two new criminal offences and below we address the concerns these cause:

This article was first published in The Commercial Litigation Journal.

The Chancellor of the High Court has published guidance on how the courts will deal with the e-filing of a “notice of appointment of an administrator” when the court is closed.

The creditor, Tall Trade Limited, claimed the first two quarterly repayments due under a loan facility agreement made in 2019 concluded with the debtor, Capital WW Investment Limited. The loan was for €17 million over a two year term. Both companies were incorporated in the BVI.