The demise of high street retail and the insolvency of household names, including Woolworths, BHS, and more recently Debenhams and Monsoon has been a real headache for property owners. The moratorium created by administration ties the hands of landlords, preventing them from forfeiting leases without first having obtained the consent of the administrator or the … Continue Reading
With the gradual opening of energy supply markets allowing new energy providers to challenge the established providers and bring increased competition to the market, the last two decades have seen an increase in smaller energy providers entering the market and sharing a growing customer base. But what happens to the customers when an energy provider … Continue Reading
It was a painful outcome for the administrator of ARY Digital UK Limited (“ARY”) when he was found in breach of duty and liable to pay £743,750. The case of Brewer and another (as joint liquidators of ARY Digital UK Ltd) v Iqbal [2019] EWHC 182 (Ch) reminds office holders of the importance of understanding … Continue Reading
We are yet to see the true impact of Christmas trading in the retail industry although HMV is already a victim of the tough conditions for retailers. Additionally, Boots has announced a fall in sales and the launch of a “transformational costs management program” to save more than $1 billion and Next has confirmed that … Continue Reading
Following the Enterprise Act 2002, the preferential status which HMRC had enjoyed in an insolvency was abolished, rendering HMRC the same as any other unsecured creditor. The effect of this was to swell the pot of assets available to be applied to all unsecured creditor claims. Philip Hammond announced in Monday’s budget that HMRC’s preferential … Continue Reading
Paul Muscutt, London restructuring partner at law firm Squire Patton Boggs, talks to Andrew Tate, former R3 President, Chair of R3’s Policy Group and Partner at accountancy firm Kreston Reeves LLP, about conflicts of interest in the restructuring and insolvency profession*.… Continue Reading
On 26 August, the Government announced that it will be making changes to UK insolvency legislation. The changes are intended to support distressed companies and address issues highlighted by major company failures and include: the ability for all companies to apply for a moratorium a new insolvency process – the “restructuring plan”, enabling companies to cram … Continue Reading
The Insolvency Service intends to publish a new guidance notice to address the issues faced by employers in dealing with collective consultation when a company is facing insolvency, following consultation with the industry last year. The guidance note is expected to require insolvency practitioners to notify the government in advance of collective redundancy proposals and … Continue Reading
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 … Continue Reading
Directors of a company in financial distress will often turn to their professional advisors to assist in making decisions about the company’s future; whether that be their lawyers, accountants, bank, tax advisors or insolvency professionals. It is often a period of high pressure, where the right or wrong decision may have far-reaching consequences for an … Continue Reading
HM Revenue & Customs (“HMRC”) has issued a consultation entitled “Tax Abuse and Insolvency: A Discussion Document” on how it proposes to confront those who misuse insolvency law as a means of avoiding or evading their tax liabilities. HMRC often describes itself as an “involuntary creditor” because it does not choose to trade with debtors. … Continue Reading
Administrators are statutorily entitled to require a receiver to vacate office (paragraph 41 Schedule B1 Insolvency Act 1986 (“Schedule B1”)). In Promontoria (Chestnut) Ltd v Craig and another [2017] EWHC 2405 (Ch) they did just that, taking steps to remove existing receivers not long after their appointment, claiming the action to be in the interests … Continue Reading
An effective and well-equipped insolvency and restructuring regime gives confidence to investors and financiers, enabling credit to flow through to businesses and boost economic activity, growth and innovation. In 1999, following the Asian financial crisis, the World Bank carried out a review of the international regimes to establish a set of key principles for effective … Continue Reading
VE Vegas Investors IV LLC and others vs Shinners and others [2018] EWHC 186 Ch Background The applicants were creditors of VE Interactive Limited (In administration) (“VE”). VE encountered financial difficulties and its directors sought insolvency advice from insolvency practitioners at Smith and Williamson (“S&W”) and appointed them to advise on and effect a pre-pack … Continue Reading
There was a magical place that’s now in administration. It’s called ‘Toys R Us’, Toys R Us’, Toys R Us’. This week has seen another two major retail casualties with the aforementioned much-loved toy shop and well-known electrical retailer Maplin going into administration within minutes of each other. As predicted in one of our recent … Continue Reading
Jamie Oliver’s two flagship restaurants have hit the headlines this week, with the upmarket steak restaurant Barbecoa in London’s Piccadilly closing. This comes shortly after last month’s announcement that Jamie’s Italian was closing 12 of its 37 restaurants, following the 6 sites that closed in January 2017. The Guardian reported that the number of UK … Continue Reading
A recent ruling of the German Federal Civil Court (Bundesgerichtshof (“BGH”)) is a reminder of the risks which shareholders of a German company can face in an insolvency of their German subsidiary. Under the German Insolvency Code (“InsO”), claims for repayment of a loan granted by a shareholder who holds more than 10% of the … Continue Reading
A recent decision of the High Court (Goel and another v Grant and another [2017] EWHC 2688 (Ch)) has provided a useful reminder that care must be taken when administrators enter into pre-contract negotiations and the risk of inadvertently entering into a binding contract before terms are finalised. It also deals with the risks of disposing … Continue Reading
“There’s a magical place, we’re on our way there, with toys in their millions, all under one roof – it’s called… Toys R Us!” The lyrics resonate with millions worldwide. The advert is as iconic as Coca Cola’s “Holidays Are Coming” commercial or the Sainsbury’s “Christmas is for sharing” World War 1 cinematic ad. Sadly, … Continue Reading
Introduction With Christmas fast approaching and black Friday/Cyber Monday having passed, retailers will be hoping for a big spike in sales this December to add some sparkle to another challenging year. The uncertain political environment both domestic and abroad has had a visible impact on consumer confidence and, coupled with rising prices and a weak pound, is adding to … Continue Reading
Following on from our previous blog A Fight Over the Runway – Monarch Administrators Lose High Court Battle, the latest development in the saga is the recent Court of Appeal decision in Monarch Airlines Ltd v Airport Coordination Ltd [2017] EWCA Civ 1892. Overturning the decision of the High Court, the Court of Appeal held that Monarch … Continue Reading
An out-of-hours office appointment of an administrator, although not unusual, is not a regular occurrence in the world of insolvency. It is however, exactly what happened at 4am on Monday 2 October, as Britain’s longest surviving airline brand ‘Monarch’ entered administration. The collapse of the airline comes as a result of mounting cost pressures in … Continue Reading
Although figures revealed last year indicated that the number of pub closures had fallen, more recent data suggests that the restaurant sector is now at greater risk of insolvency due to Brexit. This is due to rising costs which has resulted in the stagnation of disposable income (accountants Moore Stephens, for example, warned of this … Continue Reading
Paul Muscutt and Cathryn Williams, of the Squire Patton Boggs Restructuring & Insolvency team in London, analyse the current restructuring market with Blair Nimmo, UK Head of Restructuring, KPMG.… Continue Reading
