XXIV Old Buildings bulletins [Archived]

This subtopic is an archive of the Restructuring & Insolvency bulletins produced by XXIV Old Buildings which have featured in our news alerts.

XXIV

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Latest Restructuring & Insolvency News

Considering class composition—more that divides than unites? (Re Sino-Ocean Group Holding Ltd)

Restructuring & Insolvency analysis: At a convening hearing under Part 26A of the Companies Act 2006 (CA 2006) the High Court considered a proposed restructuring plan of a Hong Kong listed property company. Having satisfied itself that it had jurisdiction under Part 26A to consider the proposal, the court went on to reject a creditor’s objections to the plan proponent’s requirement for four different classes of creditors. In doing so, Mr Justice Thompsell provided helpful analysis of the authorities concerning class composition. The court also held that creditors were not prevented from raising points relating to class composition at any subsequent sanction hearing if they could offer an explanation as to why they had not done so sooner. While noting that it was not for the court to approve the proposed Explanatory Statement, Mr Justice Thompsell did require it to give greater prominence to the plan’s effect on shareholders given their absence from the four proposed creditor classes. Written by Ben Channer, barrister at 3 Hare Court.

Insolvency Service bans prolific director for repeatedly exploiting the insolvency regime

The Insolvency Service has disqualified Neville Taylor, a director of over 400 companies, for nine years due to his participation in a subterfuge formulated to sabotage the insolvency system. Taylor received £266,914 from Atherton Corporate (UK) Ltd to act as the sole director of 12 insolvent companies, where he neglected to perform his duties has director and failed to reconcile the companies' state of affairs, leading to £7.6m in unaccounted assets.

Insolvency Service secures confiscation order against BBL fraudster

The Insolvency Service announces the successful confiscation order issued against Ilhan Kekec, a restaurant owner previously jailed for fraudulently acquiring a £30,000 covid bounce back loan (BBL). Kekec has been ordered to repay £37,426 within three months or face an additional 18 months imprisonment. Kekec, who misappropriated the loan to settle personal debts, has also been banned as a company director for three years.

Debt respite scheme—jurisdiction (Seculink Ltd v Forbes)

Restructuring & Insolvency analysis: In the first appellate decision at High Court level on the surprisingly far-reaching Debt Respite Scheme (Breathing Space Moratorium and Mental Health Crisis Moratorium) (England and Wales) Regulations 2020 (the Debt Respite Regulations), SI 2020/1311, the High Court allowed the creditor’s appeal in a decision which is decidedly creditor-friendly. Sir Anthony Mann held that: (1) the courts retain the jurisdiction at all times to determine whether in point of law a particular debt is a ‘moratorium debt’, regardless of whether a creditor has exercised the review machinery under the Debt Respite Regulations; and, (2) where proceedings are live when a moratorium is entered into, a creditor does not need the court’s permission to proceed up to entry of judgment. Written by Tom Morris, barrister at Landmark Chambers.

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