The liquidator of UKCloud Ltd (the Company) applied to the court for directions as to whether a debenture granted by the Company created a fixed or floating charge over certain internet protocol (IP) addresses. The lender argued that it had a fixed charge.

Fixed or floating?

Background

The administrators of Toogood International Transport and Agricultural Services Ltd (in administration) issued an application seeking an extension of the administration. Their application also asked the court whether consent to a previous administration extension should have been obtained from a secured creditor which had been paid in full before the extension process.

Once a creditor, always a creditor?

Restructuring Plans: should an opposing creditor be granted security for costs? Might that open the floodgates where companies are by definition “distressed,” or was this particular Plan more akin to ordinary adversarial litigation? Read our summary below.

On 11 June 2024, the judgment of Re BHS Group Limited (In Liquidation) (BHS) was handed down by Leech J in the English High Court, bringing in key developments and clarifications on directors duties in the zone of insolvency.

This is especially relevant in offshore jurisdictions such as Guernsey where English insolvency legislation is often replicated in local legislation. English common law remains highly persuasive in relation to directors duties and claims by liquidators against former directors are relatively common.

Summary of claims

In Mitchell and others v Al Jaber; Al Jaber and others v JJW Ltd [2024] EWCA Civ 423 the Court of Appeal has confirmed that a director remained subject to a continuing fiduciary duty post liquidation when purporting to transfer assets owned by that company, on the basis he was an “intermeddler”. While the case concerned a BVI company, the court’s decision was based on English-law authorities and therefore has wider significance.

Facts

In the recent decision Sian Participation v Halimeda (Sian), the Judicial Committee of the Privy Council (the Privy Council) held on a BVI appeal that a winding-up petition should not be stayed or dismissed merely because the underlying debt is subject to a generally-worded arbitration agreement.

Background

Crabb was the sole director of Courtside Recycling Ltd (Courtside). From 2014 to 2018, Crabb instructed Courtside's accountants to file VAT returns but only provided bank statements for one of the Company's three bank accounts. As a result, the VAT assessments significantly understated Courtside's true VAT liabilities for this period.

Following its own investigation and using transaction information gathered from Courtside's other bank accounts, HMRC issued amended VAT assessments. Courtside was unable to pay its VAT liabilities.

The High Court considered whether a limitation period could prevent the presentation of a winding up petition based on a Lebanese judgment debt which was not registered as an English judgment.

Background

The creditor presented a winding up petition based on a judgment debt of $776,907.51 obtained in a Lebanese court in 2010. The debtor applied to restrain presentation of the petition on grounds that the judgment had not been registered nor recognised by the English Courts and the claim was time-barred.

Recognition

The Business Support and Insolvency Team at Boyes Turner acted for the joint liquidators who made a successful application for their retrospective appointment as liquidators of a company.

The case

The recent case of Re UKCloud Ltd (in liquidation) [2024] EWHC 1259 (Ch) (24 May 2024) looked at whether a charge over Internet Protocol (IP) Addresses was a fixed or floating charge. Notwithstanding that the charging document purported to create a fixed charge over such asset, the High Court concluded that it was a floating charge primarily because the control provisions in the charging document were not complied with or enforced in practice.