Transactions defrauding creditors meaning

This flowchart sets out the process under the FIDIC Red, Yellow and Silver Books, 1999 editions, for defects under: clause 7.5, where Plant, Materials, design or workmanship are discovered to be faulty or otherwise non-compliant with the Contract, and the Employer rejects the relevant Plant, Materials, design or workmanship clause 7.6, when the Employer directs the Contractor to strip out and substitute any non-compliant Plant or Materials, to take out and reperform any other work that does not meet the Contract, or to carry out any work urgently needed to protect the safety of the Works clause 11.1, under which the Contractor must perform all tasks necessary to make good defects or damage, as notified by the Employer on or before the end of the Defects Notification Period clause 12.3, if a Test after Completion is not passed, and clause 11.1(b) concerning the rectification of defects applies (Yellow and Silver Books only) For further details, see Practice Note: FIDIC Contracts (pre–2017...

Crescent Petroleum Company International Ltd and another company v Retirement, Saving and Welfare Fund of Oil Industry Workers [2024] EWHC 835 (Comm) What are the practical implications of this case? The decision illustrates how a judgment creditor can pursue enforcement measures against a judgment debtor via IA 1986, s 423. Where the debtor has divested an asset to a third party, the usual relief is an order compelling the transferee to reconvey the property to the transferor, after which allocation amongst the transferor’s creditors is dealt with by the ordinary rules. Nonetheless, IA 1986, s 425 provides the court with latitude to frame relief under IA 1986, s 423 directly against the transferee, requiring the asset to be conveyed to the judgment creditor without a prior re-transfer to the transferor. This route applies where assets have been moved away from the debtor in practice...

Purkiss (as liquidator of Ethos Solutions Ltd) v Kennedy and others [2024] EWHC 1081 (Ch) What are the practical implications of this case? This judgment clarifies the scope of IA 1986, s 423 and confirms that tax avoidance, standing alone, is not an unlawful purpose. The respondents received monies they should not have obtained by joining a failed tax avoidance arrangement; yet, without additional evidence, IA 1986, s 423 was not the appropriate avenue to recover those sums What was the background? The Company was an umbrella enterprise established in 2008 that promoted and operated a tax avoidance scheme (the Scheme) intended to enable self‑employed participants to avoid paying income tax and national insurance contributions (NICs) on their earnings. Under the Scheme, individuals who had supplied services to an end user as consultants or independent contractors became employees of the Company and then delivered their services to the end user through the Company. Most of their remuneration was routed by the Company to an offshore employee...

In this issue: Court of Protection UK taxes for Private Client HMRC Manuals updates Budgets and Finance Bills Insolvency—Private Client Contentious trusts and estates Scotland, Wales and Northern Ireland International Question of the week Additional Private Client updates this week Daily and weekly news alerts LexTalk®Private Client: a Lexis®PSL community New and updated content Dates for your diary Trackers Latest Q&As Useful information Court of Protection Court of Protection approves indefinite extension of injunction against P’s son in order to protect and support best interest decisions made for P (MK (‘P’), In the Matter of) This matter relates to MK, an 81-year-old woman with vascular dementia. To safeguard court-ordered best interests decisions concerning MK’s living arrangements and care, the court continued, on an open-ended basis, an injunction limiting her son’s contact and preventing him from independently arranging medical assessments. The court determined it holds jurisdiction, under...

In both corporate and personal insolvency, office-holders chiefly gather the company’s or individual’s assets, realise them and distribute the proceeds to creditors in accordance with the statutory waterfall. For more detail, consult the following Practice Notes: Waterfall of payments—a comparative guide Waterfall of payments in administration Waterfall of payments in liquidation Waterfall of payments in bankruptcy Waterfall of payments in administrative receivership Pari passu distribution Pari passu, a Latin term, translates as ‘with an equal step’ or ‘on equal footing’. In insolvency, it captures the principle of proportionality and is used to describe how creditors are treated relative to one another. Where claims rank ‘pari passu’, all creditors within the same class are paid alike, with no one preferred. If funds are insufficient to satisfy debts in full, distributions are made pro rata on a pari passu basis, so each receives a proportionate return. For instance, unsecured creditors (ie creditors in the same category) might receive 10p...

This glossary sets out numerous expressions frequently encountered in the restructuring arena. Words appearing in the definitions in bold are explained in other entries in this glossary. For further banking terminology, see the principal Banking & Finance Glossary. Restructuring glossary—A Acceleration: Acceleration means the agent, acting on directions from the majority lenders after an event of default, takes formal action, for example calling for early repayment of the facility. Ad-hoc committee: A temporary creditors’ group (often contrasted with a formal committee) that lacks any entitlement to official recognition. Administration: A process under the IA 1986 in which a financially distressed company is operated by an administrator as a going concern before longer-term outcomes, such as break-up and sale, are pursued. Administrator: An Insolvency Practitioner named by the court, a Qualifying floating charge holder, the directors or the company, to take control and fulfil one of the purposes in IA 1986, Sch B1. Administrative receivership: Arises when a company breaches the terms of...

A limited company can repurchase its own shares provided it satisfies specific conditions in the Companies Act 2006 (CA 2006). This activity is described as a share buyback, or a purchase of own shares. Alongside CA 2006, additional rules and guidance apply to any listed or AIM company intending to acquire its shares. The CA 2006 constraints on buybacks do not extend to unlimited companies. For more detail on that company type, see Practice Note: Unlimited companies. For an outline of the steps to implement a buyback, see Practice Note: How to carry out a share buyback. For an overview of the legal framework and typical motivations for a buyback, see Practice Note: Share buybacks—the legal framework. Off-market or on-market? Only one form of buyback is available to a private limited company: it may conduct an off-market purchase of shares. Consequently, this Practice Note does not address on-market (market) purchases of shares...

Brief details of claim This action is brought under section 423 of the Insolvency Act 1986. The Claimant is the [ insert office held ] at [ insert name of the company ] (the Company). ...