A recent English High Court decision has held that prospective Administrators do not need to look behind the directors’ motives in appointing them; they need to look ahead as to what might happen in the administration and consider whether the statutory purpose of the administration can be achieved.

The Pension Protection Fund (PPF) has issued a guidance note on Insolvency Practitioner remuneration which will apply where the insolvent company has a Defined Benefit Pension Scheme. The guidance note applies to pre and post appointment work.

The Guidance Note can be found here.

The Supreme Court has confirmed in Jetivia v Bilta that where a company brings a claim against its directors for losses caused by their wrongdoing, the directors cannot escape the claim by arguing that their actions are attributed to the company itself.

The Supreme Court also held that s.213 of the Insolvency Act, (which permits the Court to take action against those who  have conducted the business of a company in order to defraud creditors) was not jurisdictionally confined and applied to people and companies resident outside the UK.

The UK’s Pension Protection Fund (PPF) is about to publish new guidelines to reflect their increased focus on the approval of Insolvency Practitioner’s (IPs) fees. The guidelines require IPs to provide more regular detail of accruing and anticipated costs to the PPF when they are appointed over employers where Defined Benefit (Final Salary) pension schemes are significant creditors. More specifically IPs will now be required to provide a more detailed explanation of how their proposed remuneration reflects the value provided to creditors.

In general terms, section 110 of the Small Business, Enterprise and Employment Act 2015 (the 2015 Act) amends the provisions of the Company Director Disqualification Act 1986 (the CDDA 1986) in relation to directors’ disqualification.

One of the changes introduced is that the Secretary of State will be able to apply to the court for a compensation order against a director who has been disqualified where creditors have suffered identifiable losses from the director’s misconduct¹.

Key Point

An "establishment" requires business and business activity to be carried out involving dealings with third parties and not simply acts of internal administration.

Facts

The Insolvency Service has published its insolvency statistics for Q1 2015 which show that personal insolvencies were at the lowest level since Q4 2005.  In the 12 months ending Q1 2015, 1 in 478 adults (just over 0.2% of the adult population) became insolvent.  This was the lowest rate since the 12 months ending Q1 2006.

On 27 April 2015, the English High Court sanctioned a scheme of arrangement (the “Scheme”) for the US$200 million 9.5% senior notes due 2015 (the “2015 Notes”) issued by DTEK Finance B.V. (the “Issuer”), a Dutch finance subsidiary of the Ukraine’s largest privately owned energy group (“DTEK”). The Scheme was approved by 91.1% of noteholders.

The case of Philpott & Orton v Lycee Francais Charles De Gaulle Schoolserves as a welcome reminder that the English court will strictly enforce agreements to arbitrate by ordering a mandatory stay of court proceedings, even in contexts where court procedures may traditionally apply.

The Supreme Court has handed down its judgment in the case of The Trustees of Olympic Airlines SA Pension and Life Assurance Scheme –v- Olympic Airlines SA. Pitmans’ Trustee company, PTL, were the Appellants.

The question at issue was what connection must a foreign company, that has its Centre of Main Interests (COMI) in another EU country, have within the United Kingdom, to entitle an English Court to wind it up.