On the morning that Mothercare announced its CVA, its share price went up by 35% (from 20p to 27p) and now sits at 35p (up 75%) from the price the day before the CVA was launched.

It is no great surprise that following the collapse of Carillion and with other retail businesses teetering on the edge, insolvency and corporate recovery is back in the news.

Some of the biggest casualties of entities like Carillion are the employees. Luckily, in the Carillion failure many jobs have been saved, but there is still a residual cost to employees who have to submit claims to the National Insurance Fund and the liquidator to recover payments for unpaid wages, holiday and sick pay.

A review of Diana Loson v (1) Brett Stack (2) Newlyn PLC [2018] EWCA Civ 803

Facts

In this case a judgment debtor appealed against a decision in which her application to pay a judgment debt by instalments was refused.

In this recent judgment, the court considered the extent of an administrator's duties and when an administrator could be considered an agent to a secured lender.

The issues considered by the Court

The court explored the nature of the administrator's duties in relation to the conduct of the administration, the decision of which selling agents to appoint and the sale of the secured asset.

​We consider the implications of the Work and Pensions and BEIS Committees’ report into Carillion, which highlights a lack of “meaningful competition” in the statutory audit market and recommends a reference to the Competition and Markets Authority.

Summary

Claims remain frequent in the construction industry, and so do insolvencies. In the wake of main contractor Carillion’s entry into liquidation, and rumours of forthcoming interest rate rises, it is worth looking at what effect different types of insolvency have on the ability to prosecute claims.

The Advocate General Kokott (AG) has given her opinion in Grenville Hampshire -v- The Board of the Pension Protection Fund [2018] (Case C-17/17). This challenges the level of compensation offered by the Pension Protection Fund (PPF) and could result in increased payments for members.

Background

Mr Hampshire initially brought the case to the Court of Appeal in July 2016, claiming that his pension was cut by 67 per cent when his company scheme was transferred into the PPF.

The government has published a consultation paper looking at ways to improve the framework surrounding companies in or approaching insolvency. The policy objective is to reduce the risk of major company failures and their impact on a wider range of stakeholders, including employees and company pension scheme beneficiaries.

The Court of Appeal considers 'reasonable adjustment' in the context of possession proceedings

The first case in which the Equalities legislation has been raised as a defence to a mortgagee's claim for possession has recently been before the Court of Appeal.

In the last week we have seen MPs criticise accountancy firms, KPMG, Deloitte, EY and PWC in their first report on the collapse of Carillion, describing the big four as “a cosy club” and calling for the firms to be forcibly broken up. Whilst not suggesting that the firms were to blame for the collapse, it is the level of fees reportedly paid to the firms which caught the MPs attention– £72 million in 10 years.