Jurisdiction(s):
United Kingdom

Lehman administrations: guidance on Insolvency Act 1986 Schedule B1 paras 76 and 98—extending administrations, court discretion, creditor interests, alternatives, and administrators’ discharge timing (England and Wales)

Published on: 09 January 2023

Published by a LexisNexis Restructuring & Insolvency expert

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Article summary

Re Lehman Brothers International (Europe) (in administration) and other companies [2022] EWHC 2995 (Ch)

What are the practical implications of this case?

This ruling offers a concise digest of the statutory framework for seeking extensions under paragraph 76 of Schedule B1 to the Insolvency Act 1986 (IA 1986), and, drawing on recent leading authorities from the Lehman and Nortel Networks administrations, explains the approach the court ought to take when exercising its discretion on such requests. In short, the court’s discretion is unfettered, yet it must be deployed for the benefit of the company’s creditors as a whole. With eight separate companies before the court—each facing distinct concerns, issues and factual backgrounds—the judgment provides rich insight into the factors that carried weight in granting the extensions. The judge’s assessment of the evidence presented serves as a practical roadmap for lawyers and insolvency practitioners who advise on, and prepare, extension applications, especially those that are large-scale and/or intricate. It also offers assistance to insolvency practitioners drafting progress reports in complex administrations where they must notify creditors of an intended application...

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