Judgment date: 28 June 2013

Solicitor struck off for disgraceful conduct unconnected to professional duties

M, a solicitor, was struck off the Roll of Solicitors by the Solicitor’s Disciplinary Tribunal (the Tribunal) following a finding that he was guilty of disgraceful conduct.

The Landlords of units occupied by Game have been given permission by the Court to appeal to the Court of appeal against the principles laid down in Goldacre (Offices) Ltd v Nortel Networks UK Ltd (In Administration) [2009] EWHC 3389 (Ch) [2010] Ch 455 that rent falling due before the commencement of an administration does not fall to be paid as an expense of the administration.

A look at the recent restructuring of the Co-operative Bank and EU proposals for mandatory reform

The Co-operative Bank announced in mid-June that it would need to carry out a forced listing of £300m new shares on the London Stock Exchange to fill a capital hole of around £1.5bn. Co-op's difficulties are said to have been triggered by mounting losses at Britannia Building Society - which Co-Op acquired in 2009 - that were highlighted when the bank failed to follow through on its planned acquisition of 632 Lloyds branches in February this year.

The insolvency of the borrower is a standard event of default in facility agreements. As well as covering the borrower's cash flow insolvency, these clauses also often cover other, earlier signs of distress. Two recent cases have seen lenders try to exploit these outer reaches of their insolvency event of default clauses. Hayley Çapani and Adam Pierce explain why these cases are significant for parties negotiating new deals, and for lenders considering their enforcement options on existing deals.

Negotiations with creditors for rescheduling

Insurers and insureds do not bear the risk of a contractor becoming insolvent when undertaking insured repair work. The insurer’s only obligation is to pay its appointed contractor and not any subcontractors engaged by that party.

Background

Introduction

Although distressing for the owners and employees, an insolvent businesses can represent an opportunity for a buyer. One of the benefi ts of insolvency is that it can release the underlying business (which may be profi table in itself) from debts and give a buyer the opportunity to make a fresh start.

In doing so, however, buyers should beware of the employment law risks represented by any employees who remain in the business through the insolvency process.

The Acquisition

The Court of Session has held that a liquidator of a company being wound up in Scotland may abandon both heritable property and statutory licences. Affected creditors will have the right to submit a claim in the liquidation process. In the absence of that creditor holding security, the claim will rank as an unsecured claim.

Background

An administrators’ appointment automatically ends after one year, unless steps are taken to extend it. The Enterprise Act introduced a new streamlined process for moving quickly and easily from administration to creditors’ voluntary liquidation, just by filing a notice at Companies House under para 83(3) Sch B1 of the Insolvency Act (IA)1986. Problems have arisen where that notice has been filed very late in the day and not received before the administrators’ term of office automatically ends.

We note with interest the Government's Discussion Paper, 'Transparency & Trust: Enhancing The Transparency of UK Company Ownership And Increasing Trust in UK Business', published yesterday.

In the Paper, the Government proposes to (amongst other things):

This corporate update summarises certain decisions in the Court of Appeal and the Supreme Court relating to the balance sheet insolvency test, agreements to agree and the exercise of contractual discretion. The decisions clarify the law in a number of areas of day-to-day relevance.

UK BALANCE SHEET INSOLVENCY TEST: Implications for lenders and borrowers

Background