The Facts

A former director of the Torex group of companies pursued proceedings against the group’s administrators, bankers and the purchaser claiming that the sale had been at an undervalue, that the bank and purchaser conspired by unlawful means in respect of the sale and that the administrators had been negligent in distributing the prescribed part. The administrators, bank and purchaser all applied to strike out the claims by way of summary judgment.

Claims Against Administrators

The Facts

RBK Engineering Ltd served a winding up petition on Breyer Group Plc, a construction company and contractual counterparty, alleging that it owed £258,729.16 and had admitted its insolvency. Breyer Group Plc applied to strike out the winding up petition on the basis that it was an abuse of process. It argued that it was solvent and had substantial counterclaims of its own.

The Decision

What role does The Pensions Regulator have when pension schemes need protecting? In episode seven of Pensions in 30 Podcasts, we look further into contribution notices and financial support directions and when they can be brought into play.

Click here to listen to the podcast.

Key Points

The Court of Appeal has confirmed that a company must have a settled intention to appoint an administrator before it can file a notice of intention to appoint and benefit from the interim moratorium that applies as a result. We cover this, and other issues affecting the insolvency and fraud industry, in this month's update:

The court has stressed the importance of validly serving a Statutory Demand before presenting a Bankruptcy Petition. The creditor must do all that is reasonably required to bring the service of the Statutory Demand to the attention of the debtor. Without effectively serving a Statutory Demand on the debtor, presenting a valid Bankruptcy Petition is impossible.

Background

After a lengthy consultation period, the Pre-Action Protocol for Debt Claims (PAPDC) has now been finalised and will come into force on 1 October 2017. This protocol will apply to lenders who are seeking payment of a debt from an individual/ sole trader, as a debtor or guarantor. Now is the time to update your systems and procedures to accommodate the new protocol requirements.

What is required?

This article was first published in Insolvency Intelligence 2017, 30(5), 85-87.

In an earlier edition of this publication I identified what appeared to be a growing trend for the making of a draconian form of order suspending the discharge of bankruptcies. This form of order is typically associated with the case of Mawer v Bland where Mrs Justice Rose upheld on appeal the following order made by Chief Registrar Baister:

Procedural framework

Paragraphs 49 to 55 of Schedule B1 to the Insolvency Act 1986 provide the statutory framework within which administrators seek approval of their proposals.

An administrator must make a statement setting out proposals for achieving the purpose of the administration within eight weeks of the company’s entry into administration and the administrator must seek a decision from the company’s creditors as to whether the creditors approve those proposals or not.

A case of two companies, one incorporated in Dubai and the other in England, involved in a network of businesses producing contrived fancy colour diamond valuations were eventually wound up by English courts in the interest of the public.

In 2016 the High Court considered the validity of an assignment of a lease by a tenant to its guarantor. The antiavoidance provisions in section 25 of the Landlord and Tenant (Covenants) Act 1995 ("1995 Act") strictly limit the freedom of contract of parties to leases governed by that Act, broadly, those granted after 1995. Agreements which frustrate those provisions are void even if they are commercially justifiable.

BRIEF FACTS AND DECISION

EMI Group Limited v O&H Q1 Limited [2016] EWHC 529 (Ch)