The much anticipated Mainzeal judgment is released
High Court orders the liquidation of CBL Insurance
Arena Capital Limited (Arena) was a Ponzi scheme. Arena's liquidators applied under s284(1)(a) of the Companies Act 1993 for directions regarding the distribution of assets under liquidation.
The Court held that dividing the assets into trust assets and general assets was inefficient in the circumstances and ordered a "common pool approach." The Court ordered distribution on a pro rata, pari passu basis. The investors had borne the same degree of risk and it was not cost-effective to trace the numerous small contributions.
Esta é a primeira edição do “Brasília em Pauta”, um boletim preparado pela equipe de Contencioso de Brasília, contendo os principais casos a serem julgados pelo Supremo Tribunal Federal (STF), Superior Tribunal de Justiça (STJ) e Tribunal de Contas da União (TCU), bem como importantes questões a serem votadas pela Câmara dos Deputados e Senado Federal.
New Rules for Imposing Personal Liability on Directors of Insolvent Companies
When a company enters into an insolvency process, a director may be made personally liable for an insolvent company’s debts on a few limited bases under the Insolvency Act 1986, the most common of which are:
1. wrongful trading: if the director knew or ought to have known that there was no reasonable prospect of avoiding insolvent liquidation and he did not take every step necessary with a view to minimising the loss to creditors;
The Federative Republic of Brazil is the largest country in South America and the world’s fifth largest country, both by land mass (almost 8.6 million square kilometers) and population (more than 200 million people). It is the only lusophone (Portuguese-speaking) country in otherwise Spanish-speaking Latin America and the largest lusophone country in the world. Brazil is a member of the G20, and one of the BRICS countries, along with Russia, India, China and South Africa. The country’s Constitution serves as the foundation of the Brazilian legal framework and sets forth fundamental rights.
Husky Int’l Electronics, Inc. v. Ritz, No. 15-145
Debtors seek the protections of the Bankruptcy Code to have their debts discharged, but there are exceptions. A creditor can prohibit discharge of a debt “obtained by … actual fraud.” 11 U.S.C. § 523(a)(2)(A). Today, in a 7-1 decision written by Justice Sotomayor, the Supreme Court ruled that a fraudulent conveyance qualifies as “actual fraud.”
Husky International Electronics, Inc. v. Ritz, No. 15-145
A facilitation payment to encourage creditors to vote through the restructuring proposals of creditors’ debts has been held by the High Court not to be an illegal bribe. The court had regard to the fact that the offer of payment was made openly to all relevant creditors, none of whom were prevented from voting on the proposal. As such, where a creditor consented and received the facilitation payment, this was not contrary to the pari passu principle.
The facts
When a Ponzi scheme collapses, as with musical chairs, there will be some investors with a place to sit, while others are bereft of such comfort.