Zone of Insolvency

Zone of Insolvency

Category Archives: Bankruptcy Courts

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The Insolvency, Restructuring and Dissolution Act 2018 – Reforming the law on contractual remedies

Posted in Bankruptcy Courts, Involuntary Bankruptcy, Singapore

On 30 July 2020 Singapore’s new “omnibus” Insolvency, Restructuring and Dissolution Act 2018 (the Insolvency Act) came into effect. This marks the third phase in recent years to strengthen Singapore’s restructuring and insolvency laws.

The Insolvency Act consolidates the laws on insolvency, bankruptcy, restructuring and dissolution into a single enactment and introduces a number of changes to the restructuring and insolvency framework in Singapore including: (i) the introduction of a new licencing and regulatory regime for insolvency practitioners (liquidators, judicial managers and receivers); and (ii) enhancing the judicial management provisions to allow for a company to place itself into … Continue Reading

Global financial response to the COVID-19 crisis

Posted in Bankruptcy Courts, Involuntary Bankruptcy, US

We have launched our interactive cross-border guide to the financial support on offer to businesses during the COVID-19 crisis and considerations for banks, corporates and directors trading through the turmoil.

We also look at some of the issues being considered in the lending market as well as changes in insolvency law, reviewable transactions and tips for good governance of distressed companies.

Hopefully this guide will be of assistance to global operators looking to compare and contrast the impact of the crisis on their financial arrangements across a number of relevant jurisdictions.

A link to the product is here: https://www.nortonrosefulbright.com/covid-19-InternationalGovernmentResponse

Howard Continue Reading

Appeals Court Strengthens Protections for Bankruptcy Committee Members

Posted in Bankruptcy Courts, US

Serving on a court-appointed bankruptcy committee can come with many benefits, and the list just got a little longer. In Blixseth v. Brown, the Ninth Circuit held that committee members enjoy some of the same protections as trustees when it comes to potential attacks for actions taken during a bankruptcy case. Applying the Barton doctrine, the court held that a committee member could not be sued outside the bankruptcy court for actions taken in its committee member capacity without bankruptcy court approval.

Background

In the late 1990s, Timothy Blixseth (“Blixseth”) and Edra Blixseth (“Edra”), then husband and wife, developed … Continue Reading

Supreme Court Appears Ready to Limit Bankruptcy Court Power in Fraudulent Transfer Actions

Posted in Bankruptcy Courts

SupremeCourt_178740915_100dpiAfter January 14’s oral argument in Executive Benefits Insurance Agency v. Arkison, the big question appears to be not whether the Supreme Court will scale back bankruptcy court power over fraudulent transfer actions, but how drastic the new limitations will be.  Our previous discussions of Arkison appear here and here.

Background

The facts of Arkison are relatively straightforward: Peter Arkison, the chapter 7 trustee for Bellingham Insurance Agency, sued Executive Benefits Insurance Agency (“EBIA”) in the United States Bankruptcy Court for the Western District of Washington for the recovery of a fraudulent transfer.  The bankruptcy court granted summary … Continue Reading

Ninth Circuit Authorizes Recharacterization of Debt as Equity

Posted in Bankruptcy Courts

imsis148-063Earlier this year, the Ninth Circuit in Official Committee of Unsecured Creditors v. Hancock Park Capital II, L.P. (In re Fitness Holdings International Inc.), 714 F.3d 1141 (9th Cir. 2013) joined five other circuits in recognizing that bankruptcy courts have the power to recharacterize debt as equity, notwithstanding the fact that such recharacterization is not explicitly authorized by the Bankruptcy Code.  Whether a debt can be recharacterized as equity has serious implications because recharacterization typically results in significantly reduced recovery for the putative claimant and may also expose the claimholder to fraudulent transfer liability for amounts paid on account … Continue Reading