Insolvency technical update – September 2016

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Round-up of recent developments in insolvency.

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ICAS Insolvency & Restructuring Conference - Embracing the Future

This year’s conference, chaired by Gillian Carty, Partner at Shepherd and Wedderburn LLP and Donald McNaught, Partner in Johnston Carmichael's Restructuring team, will be held on 22/23 November.

The conference will consider the potential impact on the profession going forward and look at how best to tackle the challenging environment and maximise opportunities. Top calibre, well respected speakers will present on a number of topics including the economic outlook, professional standards, technical and legal updates and more.

Further details

IVA Standard Protocol

An updated IVA Standard protocol and report has been published which becomes effective on 1 October 2016.

Bankruptcy (Scotland) Act 2016

Regulations to support the introduction of the Bankruptcy (Scotland) Act 2016 have been laid in the Scottish Parliament. The Act is due to commence on 30 November 2016. Further details are available here.

SAR codes updated

The National Crime Agency has updated guidance and the glossary codes used to summarise and identify the nature of offences being reported in Suspicious Activity Reports (SAR). Further details are available here.

Companies House proposed form changes

Companies House has released information on proposed changes to forms to be introduced at the same time as the Insolvency (England & Wales) Rules 2016.

Legal Updates

Paton (as Liquidator of Ricky Martin (Racing) Ltd) v Martin, Martin and Martin [2016] SC AIR 57. The Sheriff Court considered what constitutes 'trading' and the culpability of directors not actively involved in the company in the context of a challenge to wrongful trading under section 214 of the Insolvency Act 1986.

Stanley and Barber v Wilson and Others. This case considered when pension contributions are ‘excessive’ and therefore challengeable by Trustees in Bankruptcy (via Lexology)

BTI 2014 LLC v Sequana SA & others [2016] EWHC 1686. The High Court held that a dividend can be challenged as a transaction entered into at an undervalue within the meaning of section 423(1) of the Insolvency Act 1986 (via Lexology)

Re Codere. A scheme of arrangement has been sanctioned by the Court even where the Judge recognised that the case was “quite an extreme form of forum shopping”. (via Lexology)

Express Electrical Distributors Ltd v Beavis & Ors [2016] EWCA Civ 765. Validation orders under s127 Insolvency Act 1986 will only be made in special circumstances where a particular transaction is one that is in the interests of the creditors as a whole; and the circumstances warrant the overriding of the pari passu principle (via Lexology)

Glenn Maud v Aabar Block Sarl & others [2016] EWHC 2175 (Ch). In this case the court considered how it should deal with a bankruptcy petition where the petitioning creditor may have an ulterior purpose for seeking a bankruptcy order. (via Lexology)

Tiuta International Limited (in Liquidation) v De Villiers Surveyors Limited. The Court of Appeal considered whether a lender could recover all its loss on a refinance loan from a negligent valuer, or whether the lender was limited to the “top up” advanced after the existing loan is redeemed.

Consultation on insolvency bonding

The Insolvency Service has issued a consultation on bonding arrangements for insolvency practitioners. The consultation closes on 16 December 2016.

Consultation on Scottish diligence

The Accountant in Bankruptcy has issued a consultation on diligence including diligence introduced under the Bankruptcy and Diligence etc. (Scotland) Act 2007. The consultation closes on 30 November 2016.

Topics

  • Insolvency
  • Legislation

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