Introduction The terms ‘international insolvency’ and ‘cross-border insolvency’ have no designate meaning but are commonly taken to be interchangeable and to refer to insolvencies which derives from cross-border trading or which include the application, or possible application, of the insolvency laws of two or more jurisdictions. An international insolvency is generally characterized by one or more of the following features: the debtor’s business is conducted in different countries; the creditors
The re-use of an insolvent company is protected by UK insolvency law. It helps to protect the interests of investors and creditors are not damaged by a lack of transparency relating to the director's involvement with an insolvent company, and continued involvement with its phoenix. In UK, Investors and creditors were protected under rule 4.228 and rule 4.229 of the Insolvency Rules 1986. Rule 4.228 requires notice has to be given to all the creditors of the insolvent company stating the directors’
Personal Liability Case Study Assessment of the likelihood of Sid and Kenny avoiding personal liability for the debts of the company. This question deals with directors avoiding personal liability for debts of a company, especially within the category of fraud, which is applicable to this scenario. This question also deals with lifting the corporate veil as if the directors are found to be liable the veil will need to be lifted, so as to expose the members whom are found to be liable
Prevent Insolvent Trading Insolvency can be defined as the situation whereby a debtor lacks the ability to settle the debts that they have. This definition can also include situations in which companies have numerous liabilities, most of which are greater than the assets that they have (Adams 2002, 70). The type of insolvency that regards cash flow complications often incorporates the inability of firms to settle their debts whenever they are due. The other type of insolvency that regards the balance
concepts need to be utilized. This timing can be broadly divided into the category of before insolvency and after insolvency proceedings have been initiated. Having set-off available before a party becomes insolvent is not an issue as the law does not have to deal with the insolvent owing money to third parties. Therefore, the main difference that arises in law in different jurisdictions is based on insolvency
by a collective insolvency regime which attempts to ensure the rateable and equitable distribution of the assets of the insolvent company among its creditors. This distribution is known as pari passu distribution. The Essay will focus on the meaning of the Pari Passu principle, the origin and reason of said principle, examining the criticism it faces both positive and negative concluding with if it can truly be said of the pari passu that it is fundamental in corporate insolvency law. Pari passu
Introduction The main aim of this article is to undertake a analysis of the effect that the advantage to creditors requirement has on sequestration applications. In terms of the Insolvency Act 24 of 1936 there are two processes that a debtor may sequestrate his estate. Either by voluntary surrender of his estate or by compulsory sequestration. In both these instances there is a requirement that the granting of the sequestration must be to the “advantage of the creditors”. A discharge of debtors
Section 6 (1) of the Insolvency Act requires the insolvent debtor to satisfy the court that sequestration will be to the advantage of the creditors. This onus is difficult to discharge, as many insolvent debtors do not have sufficient assets to provide for the benefit of creditors. There are many fundamental rights in the Constitution that the Insolvency Act poses a threat to, including section 9, the right to equality. One must keep in mind that even if a right is being inflicted upon, it does
given consideration include the difference between risk and uncertainty, the imperfection of market information, the risk appetite of entrepreneurs, the impact of corporate culture on self-awareness and finally criteria for assessing proximity to insolvency from both a case law and a common-sense perspective. An essential difference between risk and uncertainty is the ability to quantify and therefore manage risk, since risk is associated with measurable repeatable events and accessible to a probabilistic
payment and date of registration. Advance notices do not completely eradicate the risk period but registering an advance notice can provide the purchaser with protection against the registration of a competing conveyance from a third party as well as insolvency of the seller for up to thirty five days from when the advance notice is lodged on the register. In spite of this, the ‘race to register’ still exists although the Scottish Law Commission have said that it would ‘remain the case that the first person
Insolvency is the point at which an individual, corporation, or other organization cannot meet its financial obligations for paying debts as they are expected. Insolvency can occur when certain things happen, some of which may include: poor cash management, increase in costs, or decrease in cash flow. A finding of insolvency is imperative, as specific rights are empowered for the creditor to exercise against the insolvent individual or organization. For example, exceptional debts may be paid off
The judgment in Romalpa now simply serves as a romantic notion of what a retention of title clause could be. In reality, such clauses are now a far more scrutinised and difficult prospect for the unpaid seller looking for redress. Critically discuss The concept of a retention of title clause (hereinafter, referred to as ROT) can be traced back to late 19th Century in the case of McEntire v Crossley1. But it’s more well-known origins rest in the case of AIV v Romalpa2, so much so that ROT clauses
However, Canadian’s bankruptcy laws are unique and comprehensive. The Major legislation in Canada covering bankruptcies and insolvencies related matter is known are “Bankruptcy and Insolvency Act” (BIA). It does not only cover bankruptcy liquidation, it also takes care of debtor reorganization. There is another law known as the Companies’ Creditors Arrangement Act (the CCAA). This law helps to restructure
debtors seeking debt relief: 6 Inadequate valuation reports: 7 Disclosure of the debtor’s employment status: 7 The cost of sequestration versus the advantage to creditors: 8 The National Credit Act: 9 Conclusion: 11 Bibliography: 12 Introduction: Insolvency occurs when a debtor’s estate consists of more liabilities then assets and as a result, the debtor cannot pay his debts. There are two methods in which sequestration of a debtor’s estate can take place these are through voluntary sequestration and
This received a 27/28 in my OAC law class so, have a blast..... WHEN FILING FOR BANKRUPTCY IN CANADA The law sometimes seems to pervade all aspects of our lives and an involvement with bankruptcy and insolvency law has proved to be almost unavoidable for business people in Canada during the 1990's. In simplest term, corporate and individual bankruptcy law provides a set of rules to prevent chaos among the creditors of an insolvent corporation or individual. The legislation is a complex in part
other hand, the Disadvantages of partnership are that it doesn 't have a legitimate identity of its own. The survival issues, as the partnership will be broken up in light of the death of the partner or regardless of the fact that the partner went insolvency. Endless obligations, where the debts in partnership might be taken generally as it could be taken from their own assets to settle the
1.1. Objects of Voluntary Administration The objectives of the VA is first to provide for the business, property and affairs of the company to be administered in such a way that gives the company and/or its business the opportunity to continue in existence. Secondly, if it is impossible to save the business or company, the VA will help in getting, at least, a better return for the company’s creditors or shareholders. This statement of objectives in express form will help both the court to interpret
to all OSB employees. The objective of the digitization procedure for estate files is to ensure compliance with the Bankruptcy and Insolvency Act (BIA), the Bankruptcy and Insolvency
It is vital for a potential business investor, to analyse the different business structures available in the UK, so that they can choose the structure that is most appropriate for their business needs or goals, while also considering the legal and financial ramifications of each. There are three basic business organisations in the UK, with each having their individual features, merits and demerits. The structure an investor will choose depends on factors such as the size of the business, available
that purpose fails the money is held on trust for the payer. It mostly arises in insolvency cases where the proprietary rights have to be established. However, this type of trust has been thought to be inconsistent with the traditional trust principle. Many have suggested the Quistclose trust must be treated as any other fully fledged security device taking into account the protection it offers the payer on insolvency and should therefore be registrable. This essay critically analyses the concept