Under the equity of exoneration, where jointly owned property is charged to secure the indebtedness of one joint owner, the other joint owner is presumed, in the absence of evidence to the contrary, to be acting as a surety only, and is entitled to be exonerated by the principal debtor. This long established principle remains relevant in the modern day, as was recently demonstrated in Day v Shaw.

In a landmark decision Pillar Denton Ltd and Others v Jervis and Others [2014] EWCA Civ 180, a group of the UK's largest landlords have successfully overturned previous High Court cases that had allowed insolvent tenants to continue trading from their premises without paying rent. The landlords in this case, which involved the retailer GAME, have been allowed to recover £3,000,000 in outstanding rents from the period of the tenant's administration.

Prayers are answered in the Gamestation verdict, reports Richard Palmer, as the liability of administrators of insolvent companies to pay rent has been clarified.

But is it GAME over?

Pillar Denton Ltd and Others v Jervis and Others [2014] EWCA Civ 180

Summary – What happened?

A group of the UK's largest landlords have successfully overturned previous High Court decisions that had allowed insolvent tenants to continue trading from their premises without paying rent. The landlords in this case, which involved the retailer GAME, have been allowed to recover £3,000,000 in outstanding rents from the period of the tenant's administration.

CLLS responds on bail-in: CLLS' financial and insolvency law committees have responded to Treasury's consultation on the implementation of bail-in powers. CLLS feels it would have been better for the Financial Services (Banking Reform) Act 2013 and relevant secondary legislation to have been promulgated only once the EU Bank Recovery and Resolution Directive (BRRD) was final. However, it appears the UK Government does not want to wait until January 2016 to apply bail-in requirements and so is proceeding ahead of the EU timetable.

In the High Court decision of Jackson v Baker Tilly (unreported, 10 April 2014), the liquidators of an insolvent company successfully applied for the company's accountants to produce documents detailing their dealings with the company.

The claim here related to the ACA Standard Form of Contract for Term Partnering, which as Mr Justice Edwards-Stuart said was specifically devised for situations where one party requires the other to carry out a series of relatively minor but repetitive or cyclical tasks over a substantial period or “Term”: here building, repair and related services for a local authority. The employer or client would place orders for particular “Tasks” during the Term and the contractor (or Connaught), referred to as the “Service Provider”, would carry them out and submit monthly valuations for payment.

Key point

An English winding up does not cease to have effect when an overseas company is dissolved under the law of its state of incorporation.

The facts

Agrenco Madeira – Comercio Internacional LDA (the "Company") was incorporated under the laws of Portugal in March 2004. The Company presented a winding up petition in England in August 2009. Its centre of main interests was in Brazil and therefore the EC Regulation on Insolvency Proceedings did not apply. The Company was wound up in England as an unregistered company in October 2009.

Key point

Under English law there is a clear public interest in ensuring the timely and efficient administration of insolvent estates and parties should comply with all time limits in the Insolvency Rules 1986 unless there are good reasons for requiring more time. 

The facts

Key point

The equitable rules designed to protect guarantors from amendments to the original financing agreements made without his consent do not apply to indemnities under English law.

The facts

A company entered into factoring arrangements. The directors entered into indemnities in favour of the factor.