Insolvency for dispute resolution lawyers

The content in this subtopic is intended to assist a dispute resolution lawyer navigate the issues and wider strategic considerations which might arise in the context of disputes involving financially distressed and/or insolvent parties.

Impact of insolvency on litigation

It is important to observe at the outset that there is no general prohibition on issuing or pursuing any claims (whether original claims, additional claims or counterclaims) against ‘insolvent’ parties. Insolvency is a question of fact and individuals and companies may shift from solvency to insolvency at various times without any legal consequences as regards parties who may wish to bring claims against them. However, when a company or an individual enters into a formal insolvency process or debt management regime, restrictions may be imposed on the ability of other parties to bring, or continue with, claims against that company or individual.

For general guidance concerning the impact of insolvency processes on litigation, see: Claims against insolvent companies and individuals—overview, as well as Practice Notes:

  1. What effect does an insolvency process have on ongoing litigation and arbitration proceedings?

  2. Comparison table of corporate insolvency processes for dispute resolution practitioners

  3. Comparison table of personal insolvency processes

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Withholding DSAR documents from inspection during data protection proceedings by relying on a Data Protection Act 2018 exemption (Cole v Marlborough College)

Information Law analysis: This claim relates to the scope of production and the application of the exemptions to production of personal data in responding fully to a subject access request. The Claimant, Thomas Cole (Cole), who was a student at the Defendant school, Marlborough College (the College), submitted a data subject access request (DSAR) under Article 15 of the United Kingdom General Data Protection Regulation, Assimilated Regulation (EU) 2016/679 (the UK GDPR) after he was removed from the school following his involvement in a physical altercation with another student. In this half-day case management hearing, Mr Justice Nicklin assessed whether the College was entitled to withhold, in whole or part, documents containing Cole’s personal data, rather than providing the material for inspection ahead of a two-day trial on the data protection claim expected to start in mid-2025. The court held that the College was entitled to withhold some documents (containing Cole’s personal data) on the grounds of the exemption in paragraph 16 of Schedule 2, Part 3 to the Data Protection Act 2018 (DPA 2018). In short, this exemption provides that a controller is not obliged to disclose information to a data subject where doing so involves disclosing information that relates to another individual who can be identified from that information, whether as the source of information or as the subject of such information. Written by Robyn Bond, associate at Ropes & Gray International LLP.

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