FSA announced on 31 October that MF Global UK Limited had entered into special administration. It noted this is the first time the special administration regime has been initiated since it took effect in February 2011, and summarised the benefits of the regime. In particular, it highlighted that the regime should facilitate swift return of client assets and timely engagement with market infrastructure. (Source:FSA Announces MF Global Administration)

The Court of Appeal decision in the Nortel case upheld the High Court ruling that FSD/CN liability is an expense of the administration and therefore ranks ahead of administrators' remuneration, floating charges and unsecured creditors. Much of the press coverage which has followed in the immediate aftermath seems to have assumed that the decision is a victory for "good" pensioners over the "bad" banks.

The FOS opened last week for the business of being open. It is now subject to the Freedom of Information Act. However, theFOS web page on the point suggests the Service is trying to limit what will no doubt be a flood of requests.

The FOS’ web page sets out a long list of facts and figures it is most frequently asked about, organised into seven categories adopting the Information Commissioner’s model publication scheme for non-departmental public bodies covered by the FoIA.

The Supreme Court’s decision in a dispute over a parent company guarantee will change the way insolvency practitioners deal with the distribution of assets when a corporate group collapses.

The Supreme Court recently considered the scope of the anti-deprivation principle, in Belmont Park Investments PTY Limited (respondent) v. BNY Corporate Trustee Services Limited and Lehman Brothers Special Financing Inc (appellant) [2011] UKSC 38 (Belmont). Understanding the scope of this principle is important for anyone entering a contract where the parties’ rights and obligations change if one of them enters an insolvency procedure. Robert Spedding explains how the courts applied the principle in Belmont and makes some practical suggestions for avoiding problems.

Application for an administration order in respect of FM Front Door Ltd. The application followed FM’s failure to make payments under a loan from the Dunfermline Building Society obtained to assist with the purchase of flats at the Skyline development on Finniestoun Street in Glasgow.  The loan was secured by a floating charge and standard securities over each of the flats. FM’s parent company FM Developments also granted a guarantee for the loan.

Clause 13 of the loan agreement provided that the grounds for default included:

What happens if one party to a contract fails to perform? Can the innocent party get all of its losses back? What happens if the losses are difficult to prove?

Here, we look at what you can claim and how to protect your position.

The general rule

Damages for breach of contract are usually intended to compensate the injured party for its losses arising naturally from the breach or which were within the parties' contemplation when the contract was made.

The Masri litigation has yet again troubled the English Court on the principle of comity and provided the Court of Appeal with the opportunity to say just how important it is in international debt enforcement.

The background on Masri

In Rainy Sky S.A and six others v Kookmin Bank [2011] UKSC 50, the Supreme Court provided useful guidance on the role of business common sense in construing a clause in a commercial contract, particularly in circumstances where there are competing plausible constructions, neither of which is clearly preferable on the language used alone.

The facts

FSA has published three consultation papers on the Retail Distribution Review (RDR). The papers cover: