The ruling confirmed that Section 423 of the Insolvency Act 1986 has extensive international reach, and does not require a transaction at an undervalue to leave the debtor with insufficient assets.
By Simon J. Baskerville, Oliver E. Browne, Jessica Walker, Daniel Smith, and Chris Attrill
The English High Court has held that a creditor pursuing a claim under Section 423 of the Insolvency Act 1986 (s. 423) does not need to prove that the debtor has
The court offers guidance on reversing lawful dividend payments and when directors need to take into account creditors’ interests.
By Simon J. Baskerville, Daniel Smith, Anna Hyde, Lisa Stevens, and Vanessa Morrison
On 6 February 2019, the UK Court of Appeal published a judgment in BTI v. Sequana that will impact both creditors and directors of English companies.
The court decided that the payment of a dividend — despite its lawfulness under the Companies Act 2006
Much like the English Scheme of Arrangement which has become a popular debt restructuring solution for international debtors, the English High Court is an attractive forum for insolvency litigation thanks to the potent combination of wide-ranging powers available to Insolvency Practitioners (IPs) under the Insolvency Act 1986, and the increasing availability of litigation funding arrangements in the London market.
Transactions which prefer related party creditors or which are at an undervalue or otherwise result in serious prejudice to creditors may be clawed back in the right circumstances. Many of these remedies are capable of having extra-territorial effect. In other words they can be used to support the efforts of an overseas IP who is recognised by the English courts, and may be sought against a defendant who is outside the jurisdiction.