In Oversea-Chinese Banking Corporation Limited v ING Bank NV [2019] EWHC 676 (Comm), Moulder J rejected a purchaser’s claim that their damages for breach of warranty should be calculated by reference to a hypothetical indemnity which they would have negotiated with the seller had the true position been disclosed prior to entering into the agreement.

The Government’s final report on how to deal with insolvent airlines has been criticised by major UK carriers for its headline-grabbing suggestion of a new Flight Protection Scheme which would see a levy of about 50p put on customer fares to cover the costs of any future repatriation exercise. But the implications of the report are potentially far more significant and wide-ranging for all stakeholders.

On closer analysis, the report could see changes in:

The lender's dilemma

Lenders who take security over shares in an English company have to decide whether to take either:

• a legal mortgage by becoming registered owner of the shares
• an equitable mortgage or charge with the chargor remaining the registered owner.

A legal mortgage gives the lender the right to vote subject to the terms of the mortgage document and prevents the chargor from disposing of legal title to the shares to a third party, as the lender is the registered owner of the shares.

In Re SCL Group Ltd (& others) [2019] EWHC 954 (Ch), the High Court considered a range of allegations concerning the administrators to the Cambridge Analytica group and whether they should be appointed as liquidators following a failed sale process.

Central to the case were allegations of misconduct and potential bias against a particular creditor. The claims were rejected. But, the case contains useful observations about the role of administrators and their duties:

The High Court has confirmed that a sale by a receiver to a buyer connected with the mortgagee does not engage the self-dealing rule and further considered the extent of the duties on an enforcement sale.

The Court of Appeal has clarified a technical question on the proper operation of Section 245 IA 1986 and the extent to which it might invalidate floating charges taken to secure the supply of goods or services.

Section 245 IA 1986 invalidates floating charges created during the 12 months before insolvency, except (among other matters) to the extent of:

In Re HMV Ecommerce Ltd [2019] EWHC 9(Ch), the directors purported to appoint administrators out-of-court by e-filing the appointment documents at court at 5.54pm on December 28th. The Court’s decision on the validity of the appointment is welcome – but it did not address the underlying problem.

The development of new powertrain technology; challenges within established markets, such as diesel emissions issues; and falls in automotive production – production in the United Kingdom has fallen during the last 12 consecutive months – have had a significant impact on the automotive and mobility industry.

In this week's update: a distribution was valid despite discrepancies in the accounts justifying the dividend and an examination of vexatious resolutions.

Court considers whether demerger by dividend was valid (part 2)

In today’s insecure commercial lettings market, it is becoming increasingly common for landlords to take a significant rent deposit when granting a new lease and to enforce their rights under the rent deposit deed. This is putting the drafting and enforcement of rent deposit deeds under scrutiny. How do the parties to a rent deposit deed protect their positions when the landlord assigns the reversion to the lease?